As the pandemic raged and basic goods went missing from our favorite stores’ shelves, the supply chain links involved in getting a product from point A to point Z were illuminated. And, turns out, one of the most imperative is truck transportation. Yet, given the job’s demands and workforce demographics, the trucking industry was already experiencing a decline in drivers. The pandemic compounded this trend, while creating a marked increase in e-commerce and home-delivered goods. As a result, the last two years have seen companies lose even more long-haul truckers. But one big-box giant is changing that.
This April, Walmart raised salaries for first-year truckers to between $95,000 and $110,000 annually.
The average American trucker’s salary is about $56,491. Walmart, already known for paying its truckers better than average, is nearly doubling that. But will other large retailers follow suit? Moreover, is the importance of a well-linked supply chain changing the way companies think—not only about truckers, but about all employees involved in getting goods from the manufacturer to seller to end-user?
Wage increases, across the supply-chain employee spectrum, suggest the answer is “yes.”
According to Material Handling & Logistics News, 59 percent of supply chain workers received a salary increase during the pandemic. And the trend isn’t limited to the U.S.
In Britain, for example, a recent survey shows that truckers and dock workers have become more appreciated by the general public than teachers or the police. Commenting on the survey’s results, Tim Morris, Chief Executive of the UK Major Ports Group, said, “More of the public have also woken up to the complex, sophisticated supply chains that deliver our just-in-time lives and businesses.” (Source: Financial Times)
And this appreciation isn’t just a matter of words. In 2021, British truck drivers’ salaries rose—some by as much as 40 percent overnight, according to a BBC article.
While Brexit has factored into the loss of truckers in the U.K., other reasons cited match those here in the U.S., including an aging workforce entering retirement, relatively low wages, workers pivoting to less-grueling industries, and COVID-19-related concerns—all in addition to the exhausting nature of the job, itself.
Back in the U.S., supply-chain staffing woes may get worse before they get better. For example, as West Coast union dock workers’ contracts move toward June expiration, the possibility of strike looms. Relatively well paid by standards typically attributed to “blue collar” jobs, longshore workers cite the dangers associated with their work and the huge profits made by the companies whose goods they move.
With both dock workers and truckers willing to leave their jobs, might Walmart’s move to raise its truck drivers’ wages signal a new value applied to supply chain workers at large?
Jonathan Starks, chief intelligence officer at FTR Transportation Intelligence, thinks so. In a multi-published statement, Starks said it was “likely other firms would follow Walmart’s approach to lift pay for drivers, including for-hire carriers . . .” (Source: Financial Times)
As for Walmart, not only are they looking to hire truck drivers, they’re also looking to keep them.
Those ways aren’t yet clear, but one thing is: All organizations that rely on supply chain workers will need to step up their recruitment and retention offerings.
“Companies are having to look at industry-competitive compensation in real-time, to stay ahead of the curve, or risk losing applicants,” said Lopez. “They also risk losing their existing workforces to companies that pay more—and are right around the corner.”