Something that often goes overlooked when encountering an 18-wheeler on the road is the issue of corporate welfare. However, when following one of these trucks and noticing the advertisements indicating that companies are hiring, individuals may start thinking about the so-called “truck driver shortage.” These ads can be seen on the back doors of trailers, roadside billboards, and even on local television news segments. According to these ads, it seems like there is a high demand for truck drivers. However, the supposed shortage, which has been emphasized for years by groups like the American Trucking Association, is not real. The real problem lies in the industry’s inability to retain drivers, and rather than addressing the issues causing drivers to quit, the industry relies on a system of disguised corporate welfare presented as a jobs program.
If you look beneath the surface of advertisements for truck driver training schools, as well as local and state-funded retraining programs, you will notice the immediate presence of government grants and subsidies. These funds come from various sources such as The Workforce Innovation and Opportunity Act (WIOA), Pell Grants, and additional funding from the Biden Administration, totaling millions of dollars of taxpayer money. For example, a study in California revealed that around $20 million was spent on driver training, but the result was a revolving door of drivers who did not stay in the industry. Extrapolating this to the entire country, it becomes evident that hundreds of millions of dollars are being wasted on large trucking firms, many of which have an annual turnover rate of 92%. Despite this persisting problem, the money continues to flow.
Fortunately, a growing number of observers, including individuals from different parts of government, academia, and the trucking industry itself, are beginning to notice this pattern and question the prevailing narrative. Media outlets like TIME magazine, Business Insider, and data analytics firm FreightWaves are shedding light on the unseen factors that drive this narrative. Additionally, reports from the Bureau of Labor Statistics indicate that the labor market for truckers is functioning well, and statistics from CDL-Drivers Unlimited reveal that there are nearly three times as many licensed drivers as there are available jobs. With all this evidence, it raises the question of why the government doesn’t stop providing assistance to the industry and urge them to solve their own problems.
The claims made by the American Trucking Association and its members regarding a perpetual driver shortage contradict the evidence. The retention problem within the industry remains unaddressed and unacknowledged. In the words of Frederic Bastiat, the industry focuses on the immediate and visible effect while neglecting to anticipate and consider the long-term consequences. Instead of taking responsibility for solving their problems, the industry has found a solution by transferring the costs of truck driver training to taxpayers. This method allows them to avoid confronting their inherent issues. Trucking is a demanding job that often doesn’t adequately compensate drivers for the long hours and time spent away from home. Additionally, the current pay structure fails to account for drivers’ time, leading to significant delays at customer facilities. On any given day, approximately 40% of American trucking capacity is detained and not moving. Rather than working towards solutions with shippers and receivers, the industry has opted to pass the burden on to taxpayers by constantly replacing drivers who realize that the industry does not value or adequately compensate their time. This constant turnover in the industry results in a high number of rookie drivers on the road, leading to an increased accident rate.
In his book “The Big Rig: Trucking and The Decline of The American Dream,” sociologist Steve Viscelli documents the industry’s methods of avoiding the root problems and shifting costs onto others, including taxpayers. The trucking industry has prioritized maintaining this cycle instead of increasing wages and improving working conditions for drivers. The system of corporate welfare that underlies a critical aspect of the nation’s supply chain often goes unnoticed, but its consequences are significant, including less safe roads and the unnatural depression of wages, which have ripple effects throughout the economy.
It is not in the best interest of taxpayers or society as a whole to continue funding the trucking industry and its clients to avoid solving their own problems.
