The trucking industry across the whole of the USA and further afield in different countries, has in more recent years been hit with significant, mammoth-sized challenges that no one could have ever predicted 💭. This has led the industry to a crossroads in 2024 🛣. These challenges have created a pivotal point in the trucking industry. While navigating a landscape filled with obstacles, new opportunities are also starting to emerge.

In this blog, we will explore both the opportunities created and the challenges faced with the aim of getting a clearer understanding of exactly what the trucking industry has gone through in recent years. From there we’ll be able to also gain a good understanding of the current state of the trucking industry in 2024.

What Have Recent Years Looked Like In The Trucking Industry?

Let’s jump back in time to the global pandemic, dare we say it…COVID-19 😱 and discuss its’ lasting effects in recent years. Logistics and transportation companies, along with the rest of the world, faced challenges on a scale no one could have seen coming or even been prepared for. Supply chains ground to a halt, and the trucking industry was not off the hook!

Effects of the pandemic

This pandemic exposed vulnerabilities and drew light upon new and existing problems within the freight industry. Initially, panic buying caused a surge in demand for essential goods which strained drivers and resources to breaking point, this was particularly difficult as companies had the added stress of abiding by the constraints put in place by governing bodies, e.g. social distancing, etc.😷

As the lockdown continued, freight patterns were unpredictable and shifted dramatically, followed by an e-commerce boom, which as you can probably imagine or remember created a whole new kind of pressure. This surge in demand brought the chronic driver shortage issue to the forefront of existing, well-established carriers’ problems. Drivers faced difficulties like, closed rest areas to increased health risks, leading many to reconsider their profession. The American Trucking Association (ATA) estimates that the industry was short by over 80,000 drivers in 2021! 😳

Another apparent challenge the industry had to contend with was continually rising costs, in particular fuel prices, which saw a huge peak in 2022, when Californians were paying $6.43 per gallon, crazy we know 💵! Throughout this unprecedented period, carriers were constantly seeking solutions for efficiency, safety, and driver retention.

Increased amount of carriers in the global pandemic

Seems contradictory to what we just covered about the driver shortage but, a surprising trend emerged during the COVID-19 pandemic which was a surge in new carriers and owner-operators entering the trucking industry. From 2019 to 2022, the number of FMCSA-authorized carriers skyrocketed by over 100,000!

This influx was likely down to several factors. Firstly, the pandemic’s extended stay saw a surge in online shopping. Many of these web purchases coming from overseas and therefore, requiring transportation from ports. This growing demand for freight movement likely incentivized individuals to enter the trucking industry, and many of them did this by becoming owner-operators 🚚.

(potentially because people might have been out of a job during these uncertain times or furloughed and wanted to make some cash)

However, over the past year, a lot of these companies that “jumped on the bandwagon” during COVID-19 have sadly not been able to stay afloat in the post-pandemic trucking industry, the new “normal”. The very recent and current climate put some smaller transportation companies out of business and we have seen a ton of businesses cease trading 😔.

More trucks than loads

Although as we just mentioned a lot of owner-operators didn’t make it through the post-pandemic market. The issue of more trucks being on the road than loads needing transportation solutions remains a significant challenge in today’s market, following the strong market in the pandemic. This can be put down to lower freight demand as people are facing difficult economic times (recessionary economy). Therefore people and businesses are being much more careful with how they’re spending these days! However, this isn’t to say that this is purely due to the lasting effects of the pandemic there’s still much more to it than that!

All of these shortcomings are for the most part still apparent in today’s economy…

Challenges That Are Still Apparent In 2024

Freight recession

The definition of a freight recession: An extended period of a significant decline in the frequency of freight, the reduction in freight volume, meaning reductions in the need for transportation and therefore trucking companies facing financial challenges 💸.

So, as we mentioned about demand being down, more trucks than loads and transportation companies ceasing trading, etc. With all of this in mind, it’s safe to say we’ve been in a freight recession for some time now.

We’ve written another super informative blog about the booming Savannah port. It covers how it’s creating more jobs and demand for the movement of cargo that you can read here: The Booming Savannah Port: A Ripple Effect on Transportation . Hopefully this could contribute to a turning point in the industry and can help the current economy to recover🤞.

Ongoing Driver Shortage

2024 is no exception to the ongoing driver shortage. It seems to be a recurring problem year on year. It’s sadly a true reality that there’s an ageing driver demographic, the lifestyle of a truck driver is increasingly demanding, and there’s a huge amount of competition from other industries that offer better pay and more benefits, e.g. better work-life balance (now that working from home is increasingly popular). This driver shortage is leading to limited freight capacity for these struggling carriers, and supply chain disruptions. While the industry is always looking for new ways to attract and retain new drivers, it’s still a major challenge in the 2024 trucking industry!

 

Here’s a rough estimate of driver shortage increase over the years: As you can see there’s been a steady increase in the shortage of drivers over the years, which has become much more significant in the more recent years (2021 onwards). It’s difficult to predict the direction that 2024 will go in, as it’s still early days. However, it’s looking likely that the trend will continue through this year if we don’t start to come out of this recession.

 

 

Sounds like an oxymoron right? 🤨

You’re probably thinking, but how can we have a driver shortage when there’s a shortage in loads and more trucks than loads on the roads?

Well, where carriers are struggling to take on new drivers due to pay and benefits issues, another impactful factor is the shortage of loads we seem to be experiencing, which can scare potential candidates. People worry about job security if they take on a driving role and the freight demand does not increase. It’s almost a catch-22, carriers will struggle to meet demand without the drivers, but drivers don’t want to take the role without the demand. And visa versa, carriers don’t want to stretch themselves without the demand 🤷‍♀️

Conclusion

It’s safe to say that the only constant over recent years in the trucking industry is that there has been continual change. The trucking industry hinges on the industry’s ability to adapt, innovate and overcome challenges. What do you think will be the biggest challenge through the remainder of 2024?

Keen to Learn More and Our Predictions For 2024?

If you are you can go ahead and read our second blog as a follow on to this topic here: “Trucking Industry: The Road Ahead For 2024“. Where we deep dive into more trucking challenges, opportunities and our predictions on market recovery and what the future will hold for the transportation industry 😊.

Now, we’re not psychics. But we have certainly seen some trends form and can leverage this knowledge to take appropriate action to ensure we stay on our A-game!

Or, if you just want to learn more about how we can help with any of your toughest shipments in this economy. Then you can simply click the link below or call us on: Phone: 888-SHIP-911. We’d love to hear from you!

 

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