SO riddle me this Mr insurance man.

yeah yeah i can see we can talk tell were blue in the face.

 

Well now that we got that settled,I ll even bring the lube and lube myself.

 

The Driver Shortage - It's Here!
Apr-25th-2012
By Jason Stevenson in Industry News



Welcome back and thanks for reading The Bottom Line! I'm going to talk a little about the driver shortage - we predicted it in 2010...and it's here.

When I last addressed the driver shortage issue in December, 2010, it was commonly believed that a driver shortage might happen. Today, April 2012, it is commonly accepted that a driver shortage is happening.

Most of my clients would tell you they are having trouble recruiting drivers to fill trucks that have loads waiting on them...that if they just had 10 more drivers, they'd have 10 more trucks and the freight to fill them...what a problem to have!

Maybe a good problem - but a problem nonetheless. There are any number of ways to reduce the effect of the shortage on your company's growth plans...many companies have hired staffing companies or recruiters to help fill seats, some have decided to pay higher wages and improve benefits to keep current drivers around, and others have simply lowered their standards and are hiring under-qualified drivers.

There are two generally-accepted standards for insurability of drivers - 2 years experience and a clean driving record...there are good reasons for these standards too. The insurance companies are pretty good gauges of driver capability, after all they insure drivers all over and have for many, many years. The insurance company's interest is always safety...safer drivers mean fewer insurable incidents, and a smaller number of losses. Additionally, fleet managers/owners would agree that it's a risk putting someone with too little experience in such expensive equipment too.

That being said, there are some drivers that fit the exception, not the rule. Sometimes drivers have military CDL experience, or they've been driving for 18 months, instead of 2 years, or they're a little young, but grew up on a farm driving large equipment and 'really know how to handle themselves and their equipment'.

Whatever the exception's case, I believe YOU KNOW BEST who can and cannot drive your trucks. You've made the investment in the equipment, you meet with the prospective drivers, you're in and around trucks every day, and you know how to measure a truck driver.

So, what can you do with those drivers you want to hire, but don't meet the insurance company's standards?

The answer depends almost entirely on your insurance agency/agent and on your insurance company. Some agencies will go to bat for you on specific cases...if you can make the case that a guy should be able to drive, the agent will stand up for you with the company and get them through. Some agents hold the company line and have a 'standards and standards' mentality. Some insurance companies can be flexible too...they're as aware of the shortage and you and me.

For some trucking companies there's another option too. (This BLOG isn't intended as an advertising forum, so, though our agency has proprietary access to the program in reference, I didn't use the program's name) Certain trucking companies qualify to buy insurance through a proprietary program our agency has helped develop. The program includes a test that, if prospective drivers, regardless of their level of experience, pass, they can be added to the driver schedule as if they had the normally-required level of experience. The test, free to member-clients, can be used on any prospective driver (not just those with less than 2 years experience) and is proprietary to the specific insurance program in reference. It is unique to the transportation industry, and is a huge asset to a company looking to grow. Effectively, the test measures whether or not a driver is capable of being a quality driver, even before the driver has the road time to prove it.

We can help you decide if you're qualified if you're interested - my contact information is included if you'd like to find out more.

In any case, the shortage is real. Do what you can to combat it by investing in recruiting, making sure your current drivers are happy, and call me if you need any additional help!

I've pasted the article we published in December, 2010 below for your reading pleasure! Or you can CLICK HERE to see it as published.

Published 12/15/2010

One unfortunate fact is that over the last few years many young drivers with little experience just didn't have success and dropped out of the driver pool. Many Owner Operators and young drivers, with so little freight to carry, left the industry. Coupled with extremely tight credit markets making it hard on a driver to buy a truck and insurance companies strengthening their driver standards, young or inexperienced drivers just got pushed out of the industry.

Additionally, the impending CSA 2010 driver profiles becoming available shortly will have a lasting effect on net driver pool. While the effect of driver profiles is likely to be somewhat delayed, the loss of employable and insurable drivers will start to effect the driver pool in the next 6-24 months as insurance companies gain access to DSMS and carriers get wise to the liability they take on if they hire someone with a poor historical rating.

Lastly and probably the largest contributing factor to the impending shortage is the extinction of the large carrier driver training programs. Over the last few years it's been pretty cost prohibitive for large carriers to keep their driver training programs alive and well. For years large carriers took CDL drivers with little or no experience, paid them a slightly lower wage, and made them part of a team to get them trained. As the economy soured and freight all but dried up, companies looking to cut costs did the obvious thing...they reduced, or in many cases, cut driver training programs all together. The fact of the matter is that large carriers, the ones largely responsible for the training programs that get young drivers to the training finish line, have largely exited the training game. Moreover, the cost to enter a private training course is too high for many would-be drivers. The net result is a hole in the driver pool that's 3-4 years deep with no visible replenishment in sight.

The cumulative effect of the above mentioned factors leads me to believe that a driver shortage is a very real possibility. In fact, many growing carrier clients of mine are having so much trouble hiring quality drivers that they've hired hiring specialists to recruit quality drivers! I bet you wouldn't have expected that just a few short months ago!

The Bottom Line: All-in-all the fact that there may be a driver shortage ultimately means that trucking companies are busy enough that they need to hire more drivers than they have now...that's a great problem to have. In any case, protect the drivers you have now by showing appreciation, paying fair wages, and start recruiting NOW for potential open positions down the road. The shortage will be real and the best recruiters will probably be on top when it's all said and done.



The Bottom Line: The driver shortage is real and it's here. I suggest protecting your current drivers by showing appreciation, paying fair wages, and actively recruiting BEFORE you lose someone. I also suggest reviewing your insurance company and agent if they aren't working with you to help you grow your business. I firmly believe it's your insurance agent's obligation to design an insurance program around you business, not the other way around.



Hopefully you'll check back soon to see our weekly updates. And always, if you have any questions for the Truck Insurance Pro...please just let us know and we'll get back to you ASAP!



Keep on Rollin'!

Jason Stevenson
Truck Insurance Pro
a division of
The Hoffman Group
800.826.4006
jstevenson@thehoffmangrp.com