What's America's reason for a shortage of delivery drivers?

Photo by Mika Baumeister on Unsplash

Longhaul, truckload drivers benefitted from higher pay as a result of sky-rocketing online ordering in 2020. They stopped driving for weeks at a time and went to work for companies that paid them more. Some drivers were offered higher pay and local routes. Many drivers took advantage of extra pay and reduced their hours to spend more time with their families.

So companies like FedEx, UPS, Amazon and Walmart that can offer more regular routes and time at home have an edge beyond pay when competing for those drivers. CNN

Now the supply chain chaos is getting worse. Many businesses aren’t receiving the deliveries they need to make their products. Ports are full of shipments that haven’t been collected, and new shipments are arriving. The just-in-time (JIT) delivery system is broken. This time it’s not only a temporary setback like a container ship stuck in the Suez Canal for seven days which meant some of our Amazon deliveries were delayed. The pandemic also plays havoc with container schedules, and the cost of fuel causes ships to run slow to save fuel.

Supply chain managers and logistics experts are aware of all the potential problems, and have been debating the trade-off between “risk” versus “resilience” — the latter being the ability to minimise or quickly recover from a disruption — for the past decade or more. Low just-in-time inventories increase the risks of shortages when a crisis bites. “Resilience”, however, means bigger stockpiles, more workers, multiple suppliers and higher costs. The Guardian

JIT means as long as everything is timed perfectly, goods will arrive as expected. When something happens —or several things happening — to upset the logistics, chaos follows. 

We could see the end of cheap consumer goods. The goods already available on shelves or that manage to arrive in time for Christmas will go up in price. Other positive effects (for environmental activists) of the breakdown of supply chains are rising fuel prices and reducing the use of fossil fuels. Manufacturers of plastic products will reduce their output dependent on when they have materials, and delivery vessels and vehicles will take larger loads. Storage space will expand. Prices will rise for everyone.

A scholar at Warwickshire University writing an opinion piece for The Guardian, Kim Moody, pointed out that a slow-moving supply chain could give the planet a fighting chance.

Consumers should expect to consume less at Christmas.

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