6 Reasons Why Your Shipping Costs Have Been Increasing


A combination of new laws and new technology is causing a truck driver shortage in the United States. The effects are being felt by everyone in the industry including truckers, retailers and consumers alike.

1. America’s Truck Driver Shortage

A lot has changed in our industry and the numbers from the American Trucking Association say that there is a truck driver shortage of approximately 50,000 truck drivers.

The shortage has caused shipping rates to go up and shippers have been forced to pass the cost on to consumers such as Amazon, who recently increased the cost of its Prime membership by $20 from $99 to $119 in order to make up the deficit caused by increasing shipping rates.    

2. Electronic Logging Device (ELD’s)        

The ELD mandate went into effect in December 2017. This new mandate requires that that all long-haul truck cabins be fitted with electronic logs to make sure that truckers do not drive for more than 14 hours every day or work for more than 11 hours. Many drivers are unhappy with this new form of monitoring and have resigned in protest being a significant cause to the truck driver shortage.

3. The Economy

The strengthening economy is not helping the truck driver shortage situation either. The current employment rate is low, meaning other jobs are more attractive than long-haul trucking. For roughly the same pay, people would rather work close to home and not have to worry about traveling long-distances and being away from their families.

4. Tax Reforms

We also see President Trump’s new tax reform laws are having an effect as well. Under the new tax laws, truckers are no longer entitled to the $63 per day tax cut for food and accommodation expenses while on the road. While trucking companies will benefit from this new law however the truckers themselves will be at a loss.     

5. Drivers Benefiting

The drivers who decided to stay in the industry are benefiting from the shortage. The lack of drivers has resulted in massive increases in their wages with close to 50% of those who decided to keep trucking in 2018 receiving wage increases. The signing on bonuses has also risen from an average of $1500 in 2017 to $6000 in Q2 of 2018.           

5. Autonomous Trucking Vehicles    

Autonomous trucks, or self-driving trucks, are able to navigate roads on their own. The first iterations of the technology are actually driver-assisted however the long-term goal is to have trucks on the road which can safely be trusted to drive themselves across the country. This technology will alleviate truck driver shortage and the need for more truckers however full-scale implementations are still about a decade away.    

Driver-assisted autonomous trucks still hold potential for fixing the driver-shortage in the short-run. A big concern in the deployment of autonomous vehicles is the worry that they will take jobs away from actual people, however if the truck driver shortage is not resolved then this may be the most viable option.     

Also with the current laws, a human is still needed in the cabin while the truck drives in case a person is needed to take over the controls in an emergency. Watching the truck drive autonomously is much easier than actually doing the driving over thousand-mile stretches, therefore driver-assisted autonomous trucks may actually increase the demand for trucking jobs and help to reduce the effects of the truck driver shortage.

6. Cost Of Ownership Has Gone Up

Speaking to carriers we have found the cost of owning and running a truck has increased. The new steel tarrifs has caused all steel goods to have increased by 20% in price including trailers and truck parts. Also with the shortage of drivers carriers are having to pay drivers higher salaries and bonuses to keep them and finally but not least the price of diesel is still up.

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