During 2020 alone, more than 88,000 trucking industry jobs were lost, and more than 3,000 trucking companies closed. The COVID-19 pandemic had a significant impact on the trucking industry, causing changes in demand for certain goods and new challenges for truck drivers.
As we move into 2023 and beyond, the industry continues to adapt to new changes and challenges.
Changes in demand for goods
According to the American Trucking Association (ATA), the pandemic's impact on trucking can be summarized in three phases - initial disruption, recovery and transformation. The initial disruption occurred when many businesses shut down or reduced their operations, leading to a decrease in demand for certain goods and services. The recovery phase saw an increase in demand for essential goods, which put pressure on the supply chain and the trucking industry. Finally, the transformation phase, which is ongoing, has seen significant changes in consumer behavior, technology and supply chain operations.
One of the most significant changes in demand that emerged during the pandemic was for essential goods such as medical supplies, groceries and cleaning products. This trend has continued into 2023, with the ongoing demand for essential goods driving growth in the trucking industry. In fact, the trucking industry is expected to grow at a rate of 4.4% from 2021 to 2026, driven by the demand for essential goods.
Changes in consumer behavior
In addition to the ongoing demand for essential goods, trucking is also adapting to changes in consumer behavior as we move beyond the pandemic. According to a report by eMarketer, the U.S. e-commerce sales grew by 32.4% in 2020, and the trend is expected to continue increasing.
The major rise of e-commerce and online shopping has led to an increase in the demand for last-mile delivery services. This has created opportunities for trucking companies that specialize in last-mile delivery, as well as challenges in terms of managing the last-mile delivery process efficiently.
Changes in technology
Another trend emerging is the increasing use of technology to improve efficiency and safety. Trucking companies are investing in new technologies such as telematics and GPS tracking. Also expect an increased focus on autonomous vehicles to streamline operations and reduce costs. According to a report by the American Transportation Research Institute, the adoption of technology in the trucking industry is expected to increase significantly in the coming years.
Challenges in trucking
Trucking also continues to face challenges, particularly when it comes to the driver shortage. The pandemic has accelerated the retirement of many veteran truck drivers, and the industry is struggling to attract younger drivers to fill the gap. According to the ATA, the industry faced a shortage of nearly 60,000 drivers in 2018, and the number is expected to grow in the coming years. This has led to increased competition for drivers and rising labor costs.
To address this challenge, trucking companies are looking at ways to improve working conditions and attract younger drivers. This includes offering better pay and benefits, improving driver safety and adopting new technologies to make the job of a truck driver more attractive. Autonomous vehicles are also seen as a potential solution to the driver shortage, although it remains to be seen how quickly this technology will be adopted.
Higher fuel prices have also been a rising concern for trucking companies. Drivers are paying an extra $0.72 cents per gallon more than they were just a few years ago. This makes it more difficult for independent owner-operators to stay profitable as well, forcing them to get creative or get out of trucking altogether.
In conclusion, the trucking industry continues to adapt to new changes and challenges as we move forward. The ongoing demand for essential goods, the rise of e-commerce and online shopping, and the increasing use of technology are driving growth and change. At the same time, the industry is facing challenges like the driver shortage, which is pushing companies to adopt new strategies to attract and retain drivers. The trucking industry plays a critical role in the global supply chain, and its ability to adapt and innovate will be essential in the years to come.