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Supply Chain, Warehouse
January 31, 2018

Labor shortage in transportation: the state of affairs

The freight transportation sector is currently facing an unprecedented crisis. With delivery demands soaring, the market is having a hard time keeping up with the pace. The reason behind it all is an excessive demand variability and an increasingly hard to manage seasonality. As a result, a labor shortage in transportation makes the entire sector shaking. Here’s a rundown of the state of affairs.

Article

The logistics sector in search of workers

To understand the current shortage in transportation and logistics, various employers’ federations, including the French Federation of Road Transport (FNTR) and the French Union of Transport and Logistics Companies (TLF), conducted, from September 22nd to November 10th 2017, a wide-scale survey on all companies in the sector. The result: the 1,666 companies that responded to the survey confirmed that 22,363 job positions, including over 14,000 positions for drivers, will need to be filled by the end of 2018.

These figures exceed the initial estimate of 20,000 positions and demonstrate how difficult it is to find new road freight drivers and order preparers. According to a recent study conducted by Manpower Group, this situation is the result of unfavorable employment prospects. A theory that is hotly contested by the president of FM Logistic whose company, backed by strong sales success and economic development, expects to create more than 1,500 jobs next year.

Why such a labor shortage in transportation?

In France, the transportation and logistics sector has to tackle an ever-increasing demand, but companies are struggling to find the workers to fill the positions they’ve created. With French drivers turning their backs on the sector, it is impossible for company heads to rely on European workers who are busy enough with the increased volumes in their own markets.

Applicants are hard to come by in the sector because:

  • many drivers today choose to go the private driver route;
  • there is no guarantee that drivers will make it in time to spend their evenings at home;
  • increasing pressure and responsibilities weigh down on freight transporters;
  • drivers have reduced autonomy with the use of truck geolocalization.

These contextual factors strongly impact the sector but can be alleviated in part with the latest advances in technology for managing fleets and optimizing freight transportation, most notably in the form of TMS-type solutions.

Another factor behind this labour shortage in transportation is the tightening of French regulations on road cabotage for the transport of goods. According to the website of the French Ministry for the Ecological and Inclusive Transition, companies registered outside France are allowed, after an international route ending in France, to carry out at most 3 cabotage operations within a maximum of 7 days. These regulations place restrictions on prime contractors and drivers, and thus negatively impact the hiring process in the sector.

What solutions to deal with this shortage?

New technology

As it is becoming more difficult to hire workers, some companies are forced to refuse contracts. These decisions affect tender prices and generate tensions throughout the logistics chain. As a result, delayed deliveries become commonplace and certain loads cannot be transported.

To tackle this issue, it becomes crucial to find a way to optimize loads to meet an ever-increasing demand, without relying on a larger workforce. The main catalyst for companies in the sector lies in digitalizing operations and managing relationships with transporters. Within this context, a TMS-type solution stands out for its important benefits. It allows you to access a growing base of transporters and to coordinate operations remotely, all while streamlining loads.

Even as such, a paradox can be seen looming in the distance. Driven by the feeling of freedom that the road gives them, drivers have expressed fears over the development of new technology which is used to regulate their profession. However, it is this same technology that will allow company heads to find a solution to the current labor shortage in transportation.

Training and raising awareness

To brush aside drivers’ fears, companies have to guide their workers through the digitalization process. That is why AFTRAL (training organization in the field of transportation and logistics) has created a partnership with one of the leaders of logistics software solutions. Goal: ensure that interns are work-ready as quickly as possible by giving them hands-on experience with the latest tools during their internships. “Thanks to this partnership, we are able to use a professional software to meet the current and future needs of companies in the supply chain sector”, asserts Michel Pernot, operations director at AFTRAL Northern France.

Efforts must also be put into rebuilding the image of the sector. Around 30% of currently employed drivers are over 50 years old— a situation that does not portray the sector in a favorable light among younger generations. Committed to reversing the trend, Club Déméter, an association dedicated to sustainable logistics, has set up partnerships in order to promote the road freight driver profession. The association also created a working group dedicated to the status of driver-delivery persons. These initial steps are promising and must be taken further if we want to raise the bar.

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