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Driver Shortages: How The Looming Capacity Crunch Will Transform The Moving Industry

July 19, 2018

The trucking industry has a problem – truck drivers are aging and there are fewer young people replacing them as they retire.

Yet, as the economy grows, so do the number of people who move for new jobs, work assignments, school and other opportunities. This increase in demand combines with the decline in available drivers into a perfect storm for the moving industry, exacerbated by soaring transportation costs and new electronic logging devices that more strictly limit driving time. This has forced moving companies to start thinking outside the box to come up with new ways to meet increasing customer demand.

In this white paper, we examine the scope of this growing industry capacity problem, discuss its causes and show how Arpin Van Lines is rising to meet this challenge with an innovative new approach that will transform the moving industry.

The scope of the capacity crunch

The national truck driver shortfall was first documented in 2005. The Great Recession of 2008 saw a reduction in moving volume, as companies tightened their belts, effectively erasing the driver shortage. However, when the economic recovery started gaining full steam around 2011, talk of the driver shortage increased and gained more attention.

The 2017 Truck Driver Shortage Analysis, by the American Trucking Association, provides startling figures. By 2016, the trucking industry was short about 36,000 drivers. Today, it is estimated to be closer to 50,000. At this rate, the shortage may swell to 174,000 by 2026. Over the next ten years, the trucking industry will need to hire 898,000 new drivers, an average of 90,000 per year, to keep up with demand. According to an industry freight analysis by DAT Solutions, there is only one truck driver available for every 12 loads in 2018.

In a recent survey of transportation hiring professionals, 69 percent of respondents cited finding qualified job candidates as their number one challenge. More than half were concerned with keeping their existing drivers onboard, according to the survey, released in the 2018 Transportation Spotlight Report by HireRightSM.

This decline has hit the moving industry particularly hard. In 2012, the American Moving and Storage Association announced a driver recruiting and training initiative. The association also launched a website dedicated to providing companies with tools to recruit new drivers and training programs to help create a pipeline of new applicants.

However, the shortage persists despite these efforts, and moving companies are in fierce competition with freight companies for a shrinking pool of eligible drivers.

Why is there a shortage of drivers?

A combination of factors is causing the driver shortage.

Increase in job alternatives – As the economy has improved, there are more career options from which to choose. For example, the construction industry is experiencing a boom, and some drivers are giving up long hours on the road for a more local job with a regular work schedule.

Lifestyle – Driving is a tough job and often requires long periods of time away from home – this does not fit with everyone’s lifestyle. Newer drivers are often given longer routes, while experienced drivers may have more choice of regional or local driving positions.

Public image – As one driver put it in a story on National Public Radio, “Being a truck driver was something that carried a certain level of honor with it. They were kind of the ‘knights of the road,’ and we lost that somewhere along the way.” As young people are examining career paths, office-based professions are winning out over trades and skilled labor jobs.

Barriers to entry – Federal laws prohibit people between 18 and 20 years old from driving a tractor-trailer across state lines. These are the critical years when most young people choose their careers. By the time they reach 21, many have already picked another profession.

The moving industry has additional challenges, as well.

Competition with freight companies – Driving for a moving company requires a higher level of skill than the typical freight driving job. Van-line drivers must have excellent organizational and problem-solving skills, as they handle packing, itemizing and loading and unloading their trucks. They have to be adept at preparing documentation and keeping records. Finally, and most importantly, they must provide outstanding customer service and be good with people. By contrast, freight drivers, who drive from one loading dock to another, are not responsible for packing their trucks and never have to interact with customers.

Logistics – Van-line drivers never drive the same route. They must navigate residential areas, coordinate packing and loading, and drive household goods to a storage facility or directly to a new home for unloading and unpacking. The recent introduction of federally-mandated electronic logging devices adds further complexity and costs to a move.

Remedies

As the driver shortage continues, companies are addressing it with a variety of strategies. These include increasing signing bonuses, benefits and wellness programs. Some are replacing aging equipment with new technology to make the job easier. Many are increasing training and onboarding programs. Companies are also looking for ways to retain more of their drivers, such as adding recognition programs and offering more flexible work arrangements.

These remedies may all help reduce the severity of the driver shortage, but there is still another more lasting solution – the moving industry must evolve.

How Arpin Van Lines is redefining the household goods move

While Arpin is engaged in many of the remedies listed above to maintain its team of drivers, the company is going a step further and entirely rethinking the traditional household goods move.

To find a solution, Arpin looked to its own international moving service. In an overseas move, there is no option for a moving truck to transport a shipment to its destination. Instead household goods are packed into a shipping container and moved by sea or air.

Arpin borrowed this concept and applied it to the domestic moving market. Since small moves – 5,000 lbs. or less – do not need a full-sized moving van, they became Arpin’s test market for a service called Arpin Planned Arrival Containerization, or ArpinPAC for short.

Instead of a moving van, ArpinPAC sends a lift van and a large wooden shipping crate to the customer’s home. Locally-based Arpin movers pack up the home and load the boxes into the shipping crate. From this point, the shipment is handled like a FedEx package. Once the crate is lifted into the truck, it is taken to a freight distribution hub. From there, it is grouped into a larger shipment and routed to another regional hub, where it is sorted for distribution to its destination city. Another locally-based team of Arpin movers will receive the crate and bring it on the final leg of the journey to the customer’s new home. There, the team unpacks the container and moves the goods into the residence.

This process has many benefits for the customer. It offers:

  • Professional packing into a professional shipping container.
  • Faster transit and delivery times.
  • Simplified pricing for improved budgeting.
  • Specific pick-up and delivery dates.
  • Decreased potential for loss or damage to a customer’s household goods.

Regional moving agents and independent owner-operators make up the majority of Arpin’s moving workforce, and ArpinPAC provides benefits to these people as well. Drivers may live and work in their home cities, providing both packing and unpacking service to local customers, without the need to make cross-country trips. They may hire regional moving crews and provide them with steady work. Drivers can also see their families more, because they return home at the end of each work day.

The future of ArpinPAC and the moving industry

At this time, ArpinPAC represents 10 percent of Arpin’s moves, but it is poised to take off in the coming years.

While the service is slightly more expensive than a traditional move, it provides convenience benefits such as predictable delivery times. It gives customers more control over their moves, and it cuts down on the time they must stay in temporary housing waiting for their belongings to arrive. This also lowers the per diem rate that companies pay their employees as result of delayed shipments.

Because it is a radically different model than the traditional point-to-point move, Arpin is training its agents on using the service and on educating their customers about its benefits.

ArpinPAC is ideally suited for small to mid-sized moves; however, the company continues to refine the process to handle larger shipments more efficiently and economically.

As the driver shortage continues, companies will face tough decisions. Many will give up serving customers that offer lower profit margins and instead work only with bigger market segments, such as the corporate market. At the same time, increased competition will put downward pressure on rates, cutting some companies out of the market entirely.

As the demand for reliable, predictable and cost-effective moving services increases, so will the need for services like ArpinPAC. The service will evolve, especially as technology integration and data tracking improve, giving customers greater control over their moves.

In time, this solution will help address the moving industry’s capacity challenge by allowing drivers to specialize, stay in their home cities to serve local moves and spend more time with their families. Containerization is the future and it will transform the moving industry forever.