Current Labor Trends in the Transportation Industry

In the transportation and logistics industry, the key to balancing people and profits requires alignment between the business model and the organization's culture. Working together to manage employee relationships and risk - and actively designing systems to take these objectives into account - enables leaders in the transportation industry to get a restful night's sleep. The importance of peaceful and stable relations between management and labor cannot be overstated because businesses, employees, and consumers depend on drivers and logistics workers to deliver food, raw materials, and finished goods on time. 

They are the backbone of the nation's economic prosperity. There are a number of current labor trends in the transportation industry, including employee safety and retention, diversity, a labor shortage, supply chain backlogs, labor unions, and government actions that have converged to create enormous challenges in all areas of people management. There is plenty to keep the transportation industry up at night. The following sections explore some of the most common and challenging current labor trends in the transportation industry that are impacting positive employee relations in transportation, warehousing, and logistics. 

Driver Safety and Retention 

Safety is a top priority for transportation and logistics companies, with business leaders focusing on safe practices inside warehouses and on the road, relying on effective employee training and the use of monitoring technologies as key strategies. Truck drivers, warehouse workers, and other material movers face safety risks each day – loading trucks and trailers, driving on deteriorating road infrastructure, maneuvering among unsafe vehicle drivers, equipment failures, and planning for bad weather. The work-related pressures which affect physical and mental health are unrelenting. These are just some of the current labor trends in transportation and trucking/logistics.

With all the risks these employees assume, it is not surprising to learn there is a severe shortage of workers in the transportation, warehousing, and utilities job categories. Retention of transportation workers continues to be a problem also. The Bureau of Labor Statistics reported 489,000 job openings and 282,000 separations (quits, layoffs, discharges, retirements, other) for February 2022. The quit rate (people who left voluntarily) for the same period was 2.4 percent or 167,000 people compared to 2.0 or 129,000 people year-over-year, so the number of people voluntarily leaving their jobs is increasing. This is at a time when e-commerce has significantly increased the demand for transportation and warehouse workers. 

Another of the current labor trends in the transportation industry is wages. The Bureau of Labor Statistics reports the transportation and warehousing sector's average hourly earnings for all employees as of March 2022 is $27.79, which is nearly $4 below the national average. The average annual wages for heavy and tractor-trailer truck drivers are $51,790. The median weekly earnings for full-time workers who are members of unions is $1,147 compared to nonunion members at $883. 

There is also a diversity issue. The transportation and warehousing sector is disproportionately Black and Latino male workers at 23.6 percent for truck transportation and 36 percent for warehousing and storage. 

Add all of this up, and there is no mystery as to why the hiring and retention of team members in transportation and logistics take more effort than it does in many other industries. 

Historically, the transportation and warehousing sector has had low union membership rates. As of 2021, the percentage of employees who were members of unions was 14.7 percent. This could change quickly. Most current union members belong to the International Brotherhood of Teamsters (IBT) and the International Longshore and Warehouse Union (ILWU). Just recently, three Teamsters spoke with Biden administration officials about the advantages of union membership and the challenges they face organizing drivers. 

The current national labor climate promotes unionization. To understand the impact of the current labor trends in the transportation industry, listen to hazmat tanker truck driver Cyrus Tharpe who did an opinion piece for Newsweek. 

"I worked 12-14 hour shifts throughout the pandemic. I caught COVID-19 from a coworker since we share the same truck…Our jobs are essential because they are rooted in manufacturing and delivering goods, the underpinning of every major economy on the planet….Meanwhile, the largest corporations in America, my employer included, are federal contractors. Through executive order, "Union Guy" Joe could prioritize federal contracts to contractors who have collective bargaining agreements with their workforce. This would bring unions to the nation's largest trucking & logistics companies, as well as to Amazon, Google, and Microsoft, big tech and low tech jobs alike."

Another trucker has a different opinion, writing in The Federalist, "The simple fact of the matter is: truck drivers are "unions" in and of themselves. I don't have to "collectively bargain" for a higher wage. If a company is unable or unwilling to pay me what the market demands, there are dozens of companies out there clamoring for my services that can and will pay me what I'm worth. The problem with driver shortages doesn't lie with the trucking outfits because, in a shortage, companies have to pony up and pay drivers properly or they'll leave for greener pastures. That's why I'm a union unto myself... If an artificial wage hike ensues because of a union agreement, transportation companies have only three choices: take the loss, pass the loss on to their customers (which means higher prices for consumers), or close up shop. If we're trying to solve a supply chain crisis and inflation to boot, unionization of transportation and logistics companies is precisely the wrong move to make… When it comes to an issue like work safety, I'd leave trucking before joining a union, and all the truckers I've known would as well. You'd go blind on the Federal Motor Carrier Safety Administration (FMCSA) website before you could read through all of the safety regulations governing the trucking industry."

The two opposing opinions are presented because they both convey the complexity of the transportation and logistics industry and a path for employers to engage employees and prevent union organizing. The industry has historically had a low unionization rate. As of 2021, 14.7 percent of trucking and warehouse employees were union members. However, this is an industry ripe for a renewed push by labor unions because of the conditions employees encountered during the pandemic and because of the national focus on increasing wages across occupations.

current labor trends in the transportation industry

Labor Relations Legislation in Trucking and Transportation

The Protecting the Right to Organize Act (PRO Act) passed the house and did not make it through the Senate, but it has had an impact just with its presentation. Truckers generally opposed the PRO Act because it changed the classification of many independent contractors to employees through the ABC test. The "B" says the worker must perform work outside the usual course of the employer's business. This would make it impossible for truck drivers to remain independent contractors. Though the federal PRO Act has not passed, California passed its independent contractor law (AB5) in 2019, which has the same requirements for independent status. The California Trucking Association has appealed the law, which was blocked by an injunction, and awaits a hearing at the state's Supreme Court. That injunction could end any day – or drag on into 2023.

Though AB5 affects only one state, the pro-union federal administration continues to revive it in other ways. The White House Task Force on Union Organizing and Empowerment Report addresses "worker misclassifications," saying, ": Instruct the Department of Labor to continue to prioritize action to prevent and remedy the misclassification of workers as independent contractors, through (1) rigorous enforcement, (2) partnerships with other relevant federal and state agencies, such as the Internal Revenue Service and the Page 30 of 44 Department of Transportation, (3) guidance, rules and/or education for employers and workers, as needed, and (4) robust outreach to workers, employers, unions, and worker advocates." This is government activism to support labor unions. The Union Organizing and Empowerment Report has 70 recommendations that are intended to make unions more powerful and makes it easier to unionize. 

In the memo, The Right to Refrain from Captive Audience and other Mandatory Meetings (GC 22-04), NLRB General Counsel Jennifer Abruzzo has also asked the board to find captive audience meetings violate the National Labor Relations Act (NLRA). This would effectively end the ability of employers to ensure that all employees hear their position on unions. 

Employees have more workplace protections than independent contractors, including unemployment benefits and collective bargaining rights. Employee truckers can join unions now but historically have chosen not to in the transportation industry. But the pandemic has changed their working environment. The supply chain backlog amid a labor shortage, safety issues, and pay rates are currently issues that make employers vulnerable to unions. These issues and the federal government's push for unionization present employers with the challenge of finding ways to engage employees, many of whom are out of the workplace much of the time. 

Changing the Industry's Approach to Engaging Employees

Developing positive employee relations in transportation to retain employees goes far beyond just legal compliance. Keeping team members engaged and happy while working is challenging under any circumstance but especially when employees are on the road for a long period of time or working strenuous warehouse jobs. Carriers need to identify their reputation, organizational culture, values, and community involvement, all of which are part of the employee value proposition. 

Company branding is important, especially if a company is interested in diversifying the workforce. One of the ways to address the labor shortage is to attract people with different demographics, including women, people of color, people with different cultural backgrounds and life experiences, and others. Technology is transforming the trucking & logistics industry, and corporate branding that creates a reputation for being modern is attractive to millennials and Gen Z alike. The average age of commercial truck drivers is 48 years old. Business leaders must define the importance of diversity to company success and update their culture to attract new generations of diverse employees. 

There is an image of truck drivers as being burly men when women are fully capable of being truck drivers. In supporting the bipartisan Promoting Women in Trucking Workforce Act in Virginia, which will establish an advisory board to identify barriers to entry for women, the American Trucking Associations wrote, "With a median salary of $54,585, health and retirement benefits, and potentially thousands of dollars in signing bonuses, trucking provides a stable, good-paying career to Americans. Empowering women to thrive in an industry that provides significant compensation and benefits packages achieves the twin aims of improving gender parity and tackling the growing truck driver shortage." Gender equity is an important issue in recruitment and retention. The American Trucking Associations' American Trucking Trends 2021 report says women made up 7.8 percent of the nation's truck drivers, clearly indicating employer opportunities to improve recruitment and retention strategies.

Managers must be trained to intentionally seek out opportunities to connect and build strong relationships with team members. This means learning about the employee's goals and aspirations, their family, and what really matters to them. Managers must also take an active role in listening as they convey expectations, explain communication channels, and demonstrate how conflict is resolved. 

Don't forget to download the full Labor Activity in Transportation & Logistics Annual report, from IRI Consultants. Click the image below to download your free copy!

2022 labor relations in Transportation Report

Planning to Maintain A Direct Connection Amid the Pressures

As we face the current labor trends in the transportation industry, it is important to take a focused, structured approach to developing positive employee relations and avoiding union organizing by addressing the factors of most concern to employees in the trucking & logistics industry. 

Make HR a strategic partner in developing employee engagement – Human Resources (HR) should be more than a support unit. HR can step up and become an advocate for employee well-being and value, developing things like a recognition and rewards program, ensuring compensation and benefits remain competitive in the industry and developing employee support resources. Some transportation and logistics employees can work from home, depending on their position. HR in the logistics industry is marked by trends that include a shortage of skilled workers, an aging workforce, and a need for workers with tech skills. Improving the employee experience in even small ways sends a message the employer cares about the whole person, making carriers of all sizes attractive to all employee age groups.

Pay attention to health and safety issues – The strain and stress that employees in the trucking & logistics industry experience impact both physical health and mental well-being. In 2020, there were 846 fatalities among transportation and warehousing employees. Employees are aware of these statistics, creating even more stress. Employee resilience increases when employers offer programs supporting physical, mental, emotional, and professional needs. Safety and well-being go hand-in-hand, so continual safety training is a key strategy for addressing health issues. 

Encourage team members to speak up – Employees, including those on the road, want a voice in their workplace. The other half of this equation is that giving employees a voice means leaders should listen to all of their employees, including the drivers, and office, dock, warehouse, customer services, and technology workers. Though periodic employee engagement surveys are important, employees want to offer input on a regular basis. The only way to enable that is to offer them multiple communication channels to offer suggestions, discuss job-related and workplace issues, and contribute to decision-making. Establishing a website and social media platform that solicits opinions, suggestions, and ideas makes communication accessible to everyone. Employee advisory groups are excellent forums for providing communication opportunities. Employee feedback needs leadership feedback - dialogue. Employee input and insights should not go into a void where they are not acknowledged. 

Do not just hire employees - build relationships – While internet and software-based communications are effective tools, they can only supplement but not replace building positive employee relationships. Managers and supervisors need an open-door policy (even if it must be virtual), show appreciation for each employee's value and role in business success, be transparent and authentic, and hold meaningful conversations. Digital communication is valuable and necessary, but it should not fully replace human interaction. 

In addition, offer career development opportunities. For example, offer interested truckers eLearning development opportunities that prepare them to move into a leadership position. Investing in employee training is a key strategy even though the trucking & logistics industry is noted for employees who like stable jobs. Recognize that each employee has a different perspective and that younger workers will expect career-building opportunities. Building relationships does not mean forcing people to change. Some people are satisfied with their jobs as they are, while others would like to advance. Assessing employee needs and adapting opportunities, including through eLearning, is a basic requirement for building authentic employee relationships.

labor trends in transportation

Plan for Labor Relations Legislation in Transportation

The push to pass pro-union legislation at the federal and state levels and the pro-union position of the NLRB are the industry's reality. The PRO Act, the Whitehouse task force, recommendations, and the NLRB memos provide the information employers need to plan ahead to minimize the potential impact on their businesses. 

1. Verify that employees and independent contractors are properly classified per current law. Truckers are either employees, owner-operators, or independent contractors. Owner-operators run a business while independent contractors are gig workers, and gig workers are viewed by the NLRB and the federal government as a source of new union membership if they are reclassified as employees. Include a supervisory status analysis because the NLRB is also focusing on converting more supervisors to staff because staff employees can join unions.

2. Communicate the company's position on unionization to all employees, clearly explaining the reasons for the position.

3. Train your leaders at all levels in labor relations so they are always labor-wise

4. Perform an organizational communications assessment and communication plan that includes excellent communication with all team members while keeping the organization prepared to communicate during a crisis. 

Planning for Crisis Events in the Transportation & Logistics Industry

Preparing for any kind of crisis, be it a natural disaster, a supply chain backlog, a pandemic, or a labor event like union organizing, protests, or a strike, means making sure a cross-functional leadership team will work together to minimize the impact of a crisis event. This requires intentional collaboration and a pre-approved playbook of tactics and strategies to address potentially impactful events. A crisis is a surprising event that is a threat to business continuity, requiring business leaders to respond quickly and effectively. 

Identify the types of crises that might affect the company – The transportation and logistics industries are subject to a number of crises in today's business environment, from logistics bottlenecks due to global issues to trucker strikes. Each business should identify the types of crises they are most vulnerable to experiencing. For example, given there is a risk of a strike or protest, there is a need for a strike contingency plan, even if the business is not unionized. Workers today initiate protests and picketing on their own. A crisis contingency plan is a business continuity plan that addresses HR in the logistics industry or HR in the transportation industry from the perspective of minimizing damage to the business while maintaining positive relationships with employees.

Define the roles, responsibilities, and action steps for each type of crisis – A crisis plan, like a strike contingency plan, determines how the organization will respond to a particular crisis. It identifies the chain of command for decision-making, the communication responsibilities of business leaders, communication channels, essential staffing needs, legal compliance, and response procedures that minimize the impact of the crisis on the organization. Once the crisis plan is developed, training the leaders and other employees with named responsibilities on their responsibilities is necessary. 

Design clear communication plans – During a crisis like a strike, effective and efficient communication is crucial. The goals of the crisis communication plan are to maintain positive employee relations in transportation and logistics as much as possible and to maintain control of the narrative. It is easy to lose control during an event like a union organizing campaign unless the persons assigned roles in the crisis plan know which communication channels to use, who they should and should not communicate with, and, based on prior training, know what to say and not say.

Strengthening Employee Relations is the Key

HR in the logistics industry and in the transportation sector is unique from other industries in some ways, but people are people. They want to find value in their work, feel appreciated by their managers and supervisors, be treated with respect and believe their compensation reflects their effort.

To navigate and overcome the current labor trends in the transportation industry, employers need to build positive employee relations with the long-haul truckers the same as they do with the warehouse workers who get to go home to family each evening. It may take different communication platforms, unique recognition systems, and more leadership training in employee engagement, but the potential benefits are enormous. Employees will be happier, more productive, and less likely to turn to a union because the union is simply unnecessary. 

2022 labor relations in Transportation Report
Print Friendly, PDF & Email