Speaking at a transportation conference this week, an economist and associate commissioner at the Bureau of Labor Statistics doubled down on the U.S. Department of Labor’s position on the so-called ‘driver shortage’: It doesn’t exist.
Dr. Kristen Monaco is an economist, former economics professor, and current associate commissioner at the DOL’s Bureau of Labor Statistics (BLS). She is also a researcher and one of the authors of a report put out by the BLS which said that the DOL “does not find evidence” that a driver shortage exists.
While the American Trucking Association (ATA) issued a response saying that Dr. Monaco and her co-author demonstrated “some basic misunderstandings,” she and the BLS are not backing down from their claim.
According to reporting by FreightWaves, Dr. Monaco explained to attendees at the annual FTR conference that “if you want to attract drivers into the market, they will react to wage increases.”
There are enough drivers to serve freight capacity. If there weren’t, shipping costs would skyrocket to match demand, and companies could use the additional income to increase compensation in order to hire more drivers.
So, while the industry doesn’t have a driver shortage problem, what it may have – according to Dr. Monaco – is a driver turnover problem. Carriers like to poach truck drivers from each other using sign-on bonuses. But at the end of a year, when those drivers don’t see significant wage increases, they make more money changing companies to get another sign-on bonus.
“Companies are using turnover as a way of filing trucks,” Dr. Monaco said. “Once one carrier starts recruiting, you’re going to get this turnover because others do it as well.”
If companies offered higher wages instead of sign-on bonuses, Dr. Monaco says that not only would driver turnover go down, but it would be better for the industry as a whole.