The UK has much to be concerned about, as the plan for a robust recovery after the pandemic is clearly falling apart. However, the recovery continues but it is not sustainable. Additionally, the shortage of truck drivers was added to the list of problems. This problem did not appear yesterday as there were talks about it a couple of months ago. The UK trucking companies are raising starting salaries for potential drivers and even offering sign-on bonuses in order to attract new workers.
Laurence Bolton, managing director of the National Driving Center, assures that all these measures are effective, the number of people who want to become truck drivers has already increased by 20% compared to the period before the pandemic. However, it is not enough. According to the Road Haulage Association (RHA), the UK needs 100,000 drivers to cover the spiked post-pandemic demand.
This huge shortage of drivers becomes visible to many. Shelves at supermarkets are empty, pubs are short of beer, McDonald's pulled milkshakes from its menus across UK restaurants. Customers have to wait months for the delivery of furniture or a refrigerator.
Bank of England reported supply chain issues led to a sharp shortage of goods such as furniture, auto parts, electronics, including cement, and wood for the period from April to June. There are serious problems in the production sector as well.
Undoubtedly, when it comes to the shortage of workers in transportation companies, the possibility of higher inflation definitely comes to mind. No matter what, the shortage of long-distance drivers creates a shortage of products on store shelves and, as a consequence, an increase in the price.
In this connection, the Bank of England forecasts the UK inflation rate is likely to reach 4% this year, which is a 10-year high. This reading may rotate only if unemployed people will choose jobs in the logistics sector helping it to recover.
Notably, the issue of drivers shortage is common not only in the UK. The transportation sector crisis is seen in the US, where companies experience a lack of workers. They hope that there will be as many foreign citizens as possible to obtain work visas. Actually, Germany has the same problem in the logistics sector. The country estimates a shortage of 45,000 to 60,000 drivers.
Nevertheless, the UK suffers from occurring shortages the most. New immigration policy, which was introduced after the Brexit on January 1, remains the main reason for the roadblocks. Following the recent policy, the UK logistics sector has lost about 20,000 drivers, who represent people from different countries of the European Union.
As a rule, in the UK about 40,000 truck drivers are trained each year, but in 2020, for well-known reasons, most driving schools simply closed. As a result, the total number of people taking the truck driving exams has dropped by nearly two-thirds.
According to Rod McKenzie, RHA managing director of policy and public affairs, logistics faces shortages in new workers, and as a result, people are not receiving their ordered purchases on time. For example, Amazon products are delivered to customers' doors, according to the company's idea. Online sales business works based on the principle of "delivery by tomorrow". However, this principle does not work, because of the problems with the supply chains. Deliveries are delaying and online purchases are no longer remaining attractive to consumers. There is still no solution to this problem and the situation is getting worse every day.
The UK transportation companies hoped for the government to ease visa issuing procedures for truck drivers from the EU but they failed to succeed. Instead of helping the logistics sector, the authorities advised raising wages and improving working conditions for new drivers. The companies' CEOs reported they have been raising payments for the last six months. From February to July 2021, the usual truck drivers' income climbed by 5,7%. This is despite the fact that all other types of jobs increased wages for their workers by only 0.8%.
Whatever the case may be, but one can understand people avoiding the truck driver's job. The increased payments and working conditions still do not correlate. The official data states that the average hourly pay of truck drivers in 2020 was 11.80 pounds per hour (or 30,820 pounds per year). In other words, the annual salary of a long-haul truck driver corresponds to the national average, but after all, their hours of work are much longer.
All of these problems have alarmed the UK central bank, which is pondering the question: Will these recruitment difficulties trigger a longer-term and broader wage increase in the country? The question is still rhetorical.
Deputy Governor Ben Broadbent noted that there is a huge gap between the new logistics and IT jobs (which became in high demand during the pandemic) and the skills of people from hospitality and street retailing (which were hit hard in the pandemic). This mismatch is the main problem of the post-pandemic period, both in the UK and in other countries.