E-commerce is taking its toll on the trucking industry. Drivers earn higher wages, drive fewer kilometers, and spend more time at home.
For decades, the United States has relied on the trucking industry to move goods from coast to coast. Commercial trucks were an effective and efficient means of moving goods from the place of origin to store shelves. Since 2000 e-commerce sales have grown steadily.
E-commerce has had a tremendous impact. Shopping online has become popular due to its convenience. It also increased competition, which offers more choices and reduces prices for consumers. With the increasing use of smartphones and tablets, a person can buy things from anywhere. Electronic commerce is no longer just about the home computer.
Walmart is attracting truck drivers to its private fleet by offering double the average wage for significantly shorter trips. This is just one of many examples of how the trucking industry is changing under the influence of the rise of e-commerce.
This spring, a key retail player unveiled its plans to increase pay for drivers who deliver groceries and merchandise to Walmart stores and warehouses.
Drivers working for Walmart will be able to earn an average of up to $110,000, nearly double the current average wage in the trucking industry. Previously, drivers working for the company in their first year earned an average of $87,500. This is a clear demonstration of what the company is willing to do in a tough labor market to hire truck drivers.
The growth in demand for fast delivery and the resultant development of e-commerce in the past few years has constrained the trucking industry to restructure. There are more trucks on the roads, and the average trip time is decreasing.
In this way, truckers have more opportunities for higher earnings with shorter routes, giving them a chance to spend more time with their families.
However, because of this, the constant shortage of drivers in the traditional trucking industry will be exacerbated even further. Trucking employers, which include trucking companies, are already beginning to have trouble recruiting and retaining qualified candidates because of the difficult working conditions. With such fierce competition offered by e-commerce giants, an exodus of the best and most experienced drivers from conventional fleets is inevitable.
E-commerce is creating massive additional demand for short-haul trucking and warehouse jobs, making trucker positions harder to fill. Long hours away from home and high turnover rates are forcing truck drivers to look for work elsewhere.
As we can see, the growth of e-commerce is becoming another complementary factor, competition from other industries, and driver retirements, contributing to the shortage of qualified truckers across the country.
Walmart is the largest private trucking company in the United States. Their fleet currently has more than 12,000 drivers. Working for this company is becoming increasingly attractive to those who want to earn more income with less time on the road. The migration of drivers is inevitable.
Most skilled drivers find it highly appealing to work for e-commerce companies. It’s an opportunity to work closer to home and get shorter work trips.
Average wages for truckers in the U.S. have risen in recent years, thanks to the competition that attracts and retains qualified drivers. All the more, during the pandemic, supply chain problems have made it difficult to deliver goods everywhere.
In fact, we are now in a tight market for drivers, where wages continue to rise. From the point of view of the truckers themselves, this is certainly a good thing, because people engaged in such a hard profession should earn more and have better benefits. But the outlook for truck fleets does not look very rosy.
In order to retain employees, transportation companies also have to offer better terms to drivers and HMD Trucking is no exception. You can find out the average wage they offer at hmdtrucking.com.
However, it is worth noting that the hiring standards at Walmart and other e-commerce companies are very high and it is not easy to get a job there. You have to work hard because the training and testing are very intense. To get the job, you have to be the best of the best.
The best example to understand how e-commerce has changed the trucking industry is the significant reduction in the average trucking volume across the industry. Over the past two decades, the average trucker crossing multiple states to deliver goods has dropped from 800 miles to 500 miles. There are more loads, and fewer miles with the pay steadily rising.
Before the heyday of e-commerce, the biggest retailers had three to five distribution centers across the country where shipments were delivered by truck. Now there are dozens of them.
Also in the last decade, consumers prefer home delivery and delivery times have become shorter.
As a consequence, trucks that used to travel 130,000 miles a year now travel about 100,000 miles, as the industry has evolved at a very high rate over the past two decades.