Going Forward On Empty Miles
Despite challenges faced by the transportation industry amidst the COVID 19 pandemic, good drivers, prove that that they keep on trucking
By Jon Barry
From the Canadian consumer’s perspective, the trucking industry has always been viewed as a behind the scenes business.
This is an industry that is as vital, if not more vital, than a vast amount of the industry that allows our modern economy to function. Many people were not aware of the role that the truck operators and the trucking industry play in keeping society on the road. Like so many other things, the Covid-19 Pandemic has begun to change that. With the rise of the new term “essential workers’, Canadians across the country are taking a hard look at how they had previously valued work being done by industries that may have been taken for granted in the past. Healthcare workers, grocery clerks, food processing labourers, and finally, truckers are starting to see the work they do everyday being appreciated by the society they serve.
Trucking HR Canada conducted a survey with Aucus Data of over 1800 individuals that showed that the overall impression of the trucking sector has risen by 10-15% in the past few months since the start of the pandemic. The survey found that 54% of Canadians had a positive view of the trucking industry, 32% were neutral, and only 5% had a negative opinion. For comparison, the airline industry only had a 27% favorable rating. 85% of Canadians feel that Canada needs to have a strong trucking sector for the country to have a strong economy. 72% of respondents viewed the trucking industry as an essential service, whereas the airline industry was only viewed as essential by 16%. Much of this growth in appreciation can be directly linked to the Covid pandemic.
While the pandemic has increased the appreciation for the work that truck operators do, it has also made the already difficult and isolated work they do much more difficult and much more isolating. I spoke with Jean-Marc Picard, executive director of the Atlantic Provinces Trucking Association about the impact on truck operators: “At the beginning, it was a bit challenging with everything changing rapidly like the US-Canada border, by province. They were declared essential workers immediately. From that standpoint, truckers could still do their job. With extra precautions, such as making sure to wash their hands, having meals to eat due to most restaurant closures, and there was the added presure of finding an available washroom. I guess those pressures increased, as the weeks progressed.”
The federal government released a guideline outlining personal protective equipment (PPE) and their uses by commercial vehicle drivers “to distinguish the different types of personal protective equipment (PPE) and provide guidance with respect to their use as it pertains to commercial vehicle drivers.”
I also spoke with Linda Corkum, executive director of the Nova Scotia Trucking Safety Association about safety concerns for truckers during the COVID pandemic: “There’s a lot of communication to the truck driving industry. The Canadian Trucking Alliance, Trucking HR Canada, there’s the Safety Association in Nova Scotia. And there’s other safety associations through Canada that have been posting that information. I know we worked with a number of organizations, including the Workers Compensation Board that created a little video about, you know, keeping the driver safe. Remember, cleanliness inside the truck, outside the truck, and those types of things. So, whenever there’s an opportunity to put that out there we do that so that the drivers can constantly be reminded of what they have to do because it’s a different world now.”
But with a few headaches taken care of, a bunch of new ones would pop up to take their place: “Then the truck stuff started to close and it was tough to get food and things like that. So that was a bit of a challenge for a while.” says Picard. Once the pandemic had really started to set in and the lockdown had begun, an already isolated occupation became even more lonesome. Operators couldn’t stop anywhere for some decent food, use the restroom, or find a bed to sleep for the night.
While the pandemic has definitely increased the hardship on truck operators, East Coasters and Canadians across the country are stepping up to do their part to help these essential operators keep our country moving forward: “The response from the public was huge and then restaurants started to offer a curbside or drive through and chains of restaurants like McDonald’s and Swiss Chalet offered specials to carriers.” says Picard. Corkum has also seen an explosion in support for truck operators: “Since the initial phase, there’s been a lot of generosity amongst people across Canada that have opened their doors, some of the restaurants have the drive up services.
I know in Nova Scotia we have a particular restaurant that was a truck stop, if you will, open to the public that is only open for truck drivers.” “We have a few hotels that are offering free showers and little gift bags of appreciation for the drivers because although they have always been an essential service, the public is realizing just how essential they are through this process.”
Transport Canada has also stepped up to help address the shortage of access to on-the- road services for truckers. Transport Canada explained that they are “collaborating with governments to ensure that the washrooms at gas stations and restaurants remain open and allow access to truckers. Work is also continuing with the provinces and territories to explore options to increase accessibility and fill gaps where possible.” They are also encouraging “restaurants and other service providers to support commercial drivers’ needs and provide them with access to restrooms.”
Of course it isn’t just the individual operators who have been impacted by the pandemic. Individual fleets are feeling the squeeze on their businesses. The Canadian Trucking Association (CTA) published a Business Conditions Report in May that outlined the short-term industry forecast. They report that “If overall conditions do not improve over the next three months, 37% of carriers report that they will be in serious financial trouble.”
It explained that “Over 90% of carriers reported that they have experienced a decrease in revenue since COVID-19. On average, carriers have experienced a 33% decrease in revenue since the crisis began.” The CTA claims that the impact is being driven by “customer closures, falling rates, and an explosion in empty miles.” They state that empty miles have increased by 200-300% with vanishing profit margins.
CTA reports that 63% of carriers have reported customers asking for payment deferrals. 78% responded that their clients have either closed or significantly reduced operations. Mike Millian, President of The Private Motor Truck Council of Canada, also sees the rise in non- payments creating a problem: “They’re extending payments, people that might have paid in 30 or 60 days are now pushing them to 90 or 120 days or 150. I don’t think people are doing this because they’re trying to take advantage. I think people are doing this because as we know, this has been a financial disruption for everybody. They’re trying to make sure they take employees and everything else first, but the problem is, if you’re a carrier, you’re still out there incurring the expense. You’re still paying your driver, you’re still paying your fuel. You’re still paying your insurance and all that other stuff. But people aren’t paying.”
There is also the problem of deferred costs, like licensing, that could come roaring back once the economy starts to reopen, and an already cash – strapped industry may have more of a struggle to get back into high gear: “If you’re three months behind, and then you’ve got to pay for that and you’ve got to pay for a full year on top of that you’re now paying 15 months of license plate. As an example, in the province of Ontario to license a truck for the maximum gross vehicle weight of 6363 and a half thousand kilograms is over $4,000 per truck per year. So you have 100 trucks, times $4,000. You’re looking at 400 grand. So we’re not asking these fees to be waived.” “So if we owe for 18 months, let’s take those 18 month payments and spread it out over 2436 days, and so kind of like a deferral.”
Millian and The PMRCC represent private and dedicated fleets for organizations like Tim Hortons, Molson, Coors, Loblaw and Superior Propane. Millian explained that his fleets have seen a mixed bag of results when dealing with the Covid-19 pandemic: “So, what has happened with our membership is kind of a microcosm of what happens in society. So as you can imagine, a member like Loblaw, actually has been busier through this pandemic. Restaurants and concerts and all those other things have shut down but that’s led us all into having to go to the grocery store more and buy a lot more supplies plus the panic supply buying at the start. So some of our members actually saw an increase in business and we’re having trouble getting enough drivers to get the work fulfilled at the start of this.
Other members who worked in sectors like the restaurant industry, saw severe declines and tended to lay off drivers. Some of our members had to lay off 90% of the workforce, while other members of ours needed to increase. But overall as an industry, it is down roughly over 25% from what it was pre- pandemic”
When it comes to subsidized wages for the Canada Emergency Wage Subsidy, this has been its own struggle for the industry. The federal government recently improved the CEWS eligibility but it may still fall short in regards to the trucking industry. According to the CTA “ the CEWS extension does not have the same impact for everyone, especially in trucking, which has very specific operating conditions.” According to the business conditions survey of carriers: “38% qualify and have applied for the CEWS, 13% believe they may qualify but have not applied yet, 49% do not qualify for the CEWS”. That’s nearly half of the carriers that do not qualify for the emergency wage subsidy. The CTA is currently working with government agencies and other organizations to make the wage society scalable for those that are falling through the cracks. The CTA is also “asking the Government of Canada to introduce a Payroll Tax Deferral Program, which would provide fleets the needed cash flow to help maintain operations. Additionally, CTA wants an increase in the meal allowance for all truck drivers facing rising costs associated with operating during COVID-19.”
Of course, the never-ending talk surrounding the operator shortage cannot be left out of the conversation. The operator shortage was already an issue, but that has somewhat changed with the drop in demand that saw a massive streak of layoffs across the country. While some industries, like groceries have increased their need for operators, other areas like crude in Alberta took a double hit with the pandemic forcing the province into lockdown and also tanking the price of oil. According to Picard: “Some companies aren’t that busy, so I mean, they are not looking for the five, six drivers that they’re looking for (in the past).” “So, you know, we were in a shortage of drivers but now with the situation, it’s really manageable because of that”.
While the situation may be manageable for now, organizations like Trucking HR Canada are concerned that both the layoffs and fears about the virus from the aging operator population could make the shortage come roaring back once the economy kicks into high gear. Just weeks prior to the country shutting down, Trucking HR Canada was still sounding the alarm about a projected 25,000 operator shortages that could severely impact the economy by 2023. This projected shortage has already been impacted by the pandemic in drastic ways. A Trucking HR Canada report states that “Canadian employment of truck drivers also declined in April by roughly 6,800 workers, or 2.3%.”
There is still uncertainty about what the driving factors are in the drop of employed operators. Trucking HR Canada is planning to conduct industry surveys to determine “how much of the decrease in employment of truck drivers is due to company- initiated lay-offs in comparison with employee-initiated attrition – for example drivers who are choosing to retire in the face of increasingly difficult working conditions, particularly among the older workers that dominate the truck driver occupation.”
Corkum agrees that some of the retirements are being driven by the health concerns of the industry’s aging workforce: “Yeah, some of them have opted to retire. Some of them may have some underlying health issues that have prevented them from driving. There’s the fear of the COVID itself, getting the COVID. There is no vaccine for what the end result would be. So, you know, there’s a fear that they’re not ready to leave this world yet, and therefore, they want to be around for their family. So they’ve opted to do that.
I’m sure that even if they weren’t retired, there is that fear. But I think the ones that we talked to, that are working and they’re out there delivering the basics of life for the general public, they keep moving, but they do know that there are restrictions and they have to work safely around that to protect themselves because there’s somebody at home waiting, right?”
While the operator shortage may still be a concern, the industry as a whole has seen its profile raised and respected to new heights that could be built upon to brand and attract new drivers to the industry: “I am a believer that, you know, even in the darkest days, there’s always something good that comes out of everything.
And I think the good that has come out of the trucking industry through this pandemic is the image of the driver and the profession” says Millian. “I do think that this is a positive that’s come out in this industry that we are going to have to take advantage of when this is over and make sure that we continue to build on that.”
Picard agrees that the increased appreciation is the silver lining of the pandemic: “Yeah, so that’s huge. And we’re gonna build on this, we’re gonna continue to do what we’re doing for the industry and hopefully will allow a little bit more ease in recruiting going forward and things like that.”
