Truck Shortages and Distribution Backlogs

Posted on August 12, 2021

With the effects of COVID-19 still looming the logistics industry, there has been an increase in demand for truck drivers leading to increased transit times due to distribution backlogs. The consumer demand for their shipments has led to the discovery of bottlenecks existing within ports and distribution centers. This was increasingly noticeable once the holiday seasons approach during the end of 2020. The limited availability of trucks has led to an increase in prices for shippers as they are competing for capacity. There has been an 8.1% increase in the past year for per-mile costs. Specifically, when looking at the spot market for trucks, there has been a 41.9% increase in per-mile costs, raising it to an average of $2.61 per mile (Smith, 2021).

In efforts to expand capacity, trucking companies have increased pay and purchased new equipment to help resolve the problem; this is another reason for the increase in pricing for trucks. The trucking companies are struggling to appeal to drivers as there are concerns of getting sick and the availability of obtaining stimulus checks and unemployment benefits. This will result in trucking companies facing challenges to hire on new drivers and retain them for the long haul.

The projected outlook for truck shortages to be resolved is early 2022. There are many moving parts within this issue of capacity and distribution backlogs. It is important to work towards decreasing the backlogs and find solutions to the bottlenecks existing in ports and distribution centers. One way to assist in recruiting more drivers is to cover costs for schooling required to drive the equipment. This combined with an increased wage may help to increase the want to be a truck driver. In the past, it has been said that truck driving let you see the country. With the lack of travel due to the pandemic, this is a great appeal of the truck driving job.

Contributor: Taylor Navan

References: Smith, J. (2021, April 14) Trucking Companies Boost Pay in Hunt for Drivers as Demand Surges. The Wall Street Journal. https://www.wsj.com/articles/trucking-companies-boost-pay-in-hunt-for-drivers-as-demand-surges-11618401600


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