Transport industry news outlet Transport Operator has echoed Driver Require CEO Kieran Smith’s warning that the combined effects of Covid-19, Brexit and lingering issues around poor pay and working conditions could lead to a major shortfall in available truck driver personnel over summer 2021 and beyond.
When initially released in May 2021, driver recruitment agency Driver Require’s report, entitled A Perfect Storm of Elevated Demand and Reduced Supply in the UK Haulage Sector in 2021, laid bare a number of findings compiled by a Think Tank set-up by Smith, which consisted of representatives of the Recruitment and Employment Confederation, Logistics UK, Trailblazer Group for Transport and Logistics, a logistics statistics expert, a national fleet hire supplier, a large LGV training school, and three hauliers: a FTSE 100 grocery supplier, a FTSE Small Cap e-commerce and retail logistics operator, and an SME general haulage operator and pallet network member.
Just as The Leaders Council reported earlier in the year, Transport Operator explains that one of the major conclusions to emerge from the report was that although UK haulage activity had returned to pre-Covid levels, issues with prospective drivers accessing Covid tests and a drop off in the quantity of foreign nationals holding LGV licences in the UK had led to an estimated fall of seven per cent [22,000] in the supply of drivers in a ‘most likely’ scenario. The ‘worst case’ scenario drop off was estimated to be 10 per cent, equating to 30,000 drivers.
Quoting the report, Transport Operator warns that a post-Covid increase in consumer demand over summer may coincide with full-time drivers wanting to take holidays, therefore intensifying the shortage.
Going further, the outlet adds that the fleet hire company which formed part of Smith’s Think Tank warned of lead times for new equipment having extended to more than nine months, with its fleet operating at 95 per cent utilisation, around 10 per cent higher than anticipated levels.
Exploring feedback from the Think Tank’s general haulier, Transport Operator echoes the report’s findings that pallet network depots were seeing volumes increase within the region of 30-60 per cent. Other companies also say they have had to ‘stand’ trucks because of a driver shortage, explaining that they will not put extra vehicles on the road thanks to their pool of loyal drivers being fully engaged.
Furthermore, the Think Tank’s e-commerce and retail logistics provider advised that High Street fashion was now running above levels customarily seen on busy dates such as ‘Black Friday’ and ‘Cyber Monday’, with further growth in demand likely to follow with the reopening of the hospitality and entertainment sectors.
Imports were also said to have been affected by the closure of the Suez Canal, with goods being delivered having been warehoused in the UK since the spring and summer of 2020.
Quoting the report once more, Transport Operator explains that stocks beginning to arrive in the UK following the Suez reopening could apply further pressure to the upstream logistics chain clearing goods from ports, with some stock even at risk of missing the summer season this year and having to be held back until 2022.
Brexit has also contributed to exacerbating this problem by making the UK internal market less lucrative for foreign hauliers. Pre-Covid, gaps in driver recruitment had been filled by arrivals from Eastern Europe, but Brexit has effectively ruled out this option.
Quoting another major finding in Driver Require's report, Transport Operator highlights that the Covid-19 pandemic has taken its toll on the amount of new drivers entering the industry. Pre-pandemic there were said to be around 40,000 LGV test passes per annum. During lockdown, roughly 14,000 LGV passes were achieved, and the report goes on to advise that many of these were C1 passes for ambulance drivers being upgraded to handle vehicles of 3.5 to 7.5 tonnes.
Picking up on the report’s comments on the current status of the industry, Transport Operator reaffirms that employee dissatisfaction and ‘churn’ within the sector are now customary. Indeed, in the five years pre-Covid, the report uncovered that over 30,000 new drivers had passed their test each year, and a mere 10,000 at the most had reached retirement. Yet despite this, the number of active drivers had remained constant at 300,000. Taking this into consideration, it was calculated that seven per cent of all drivers were therefore choosing to leave the industry each year, before even reaching retirement age. Further to this, 600,000 individuals were found to hold LGV licences but not drive as a career choice.
Transport Operator than reiterated the Think Tank's warning that demand was likely to soon return to a level requiring around 300,000 drivers, whereas the actual pool of active drivers in the UK will have fallen to 282,000.
The report concludes that employers and agencies will be left to compete for a dwindling supply of drivers in the short term, an issue which may be offset by higher wages which could entice more people into the sector. This applies even if the Think Tank’s proposed mitigating acts are implemented, which involve training new drivers, enticing qualified licence-holders back into the sector, and changing immigration laws to permit EU drivers to work in the UK.
With regards to the recommended step of lobbying government to amend immigration laws in favour of EU drivers, it was acknowledged by Transport Operator and within the original report that with such a high level of qualified licence-holders currently inactive, it may be difficult to persuade the government that there is a sufficient shortage of personnel to warrant giving foreign workers special dispensation.
Transport Operator adds that although Driver Require could not provide hard data as to why such a large proportion of LGV licence holders had left the sector, some could opt to return if improvements to wages and working conditions were to be introduced. Interestingly, current wage levels were found to be attractive enough for individuals in the 18-25 age group, with the long working hours also less of a deterrent for this demographic.