American businesses want to keep trucking along, but they’re running into a persistent roadblock: a driver shortage amid high demand for freight services.
The Federal Reserve’s July Beige Book, a collection of anecdotes from across the Fed’s regional bank districts, showed 25 mentions of “truck” or “trucking,” up from just 10 a year earlier.
For months, businesses have been expressing anxiety on earnings calls about rising shipping costs and capacity constraints in the trucking industry as a hot economy stokes demand.
“Six districts specifically mentioned trucking capacity as an issue and attributed it to a shortage of commercial drivers,” according to the Fed report, released July 18.
In some districts, such as the Richmond Fed’s, the shortage means demand is going “partially unmet.” In the Boston region, it’s driving up freight costs, while businesses in the Cleveland area are turning to railroads as a transportation method. And in the St. Louis region, it’s pushing up wages: “One trucking company offered the largest one-time pay increase in its history.”