Dealing with 'Hard to Fill' positions? Don't forget about throwing cash at the problem

Quick shot for a post Super Bowl Monday - I have posted a few times over the last year or so about the US Trucking industry and the labor market for commercial truck drivers. I am fascinated by this sliver of the labor market as many of the big labor trends like increased automation, shifts in demographics, increased regulation, and employers struggling to hire enough new drivers (and retain existing ones), make this area really ripe for observation and analysis.

Having said that, I wanted to highlight one of the strategies that one employer, in fact the largest private employer in the US, is rolling out in an attempt to find more candidates and ultimately make more hires. Simply put, it is throwing more cash at the problem. Here's what Walmart is doing in order to hire more truck drivers from a piece on Fortune:

While some people focus on whether automation will kill long-haul trucking jobs over the long-term, Walmart is currently more concerned with its short-term reality. The company is once again raising truck driver salaries to try to correct for an ongoing shortage of drivers. Walmart needs to hire at least 900 drivers this year, according to the Dallas Morning News.

One reason: trucking tonnage is way up. The American Trucking Association, the industry’s largest trade association, says that tonnage hauled annually is up 6% is up even while the industry continues to suffer from nearly 50,000 unfilled long-haul jobs. The ATA’s chief economist Bob Costello notes that in 2018, truck tonnage hit its highest peak in 20 years.

In a separate change, Walmart also recently relaxed somewhat the candidate screening process for prospective drivers. Instead of a 'one and done', fail and you are out screen of driving skills, Walmart is now allowing candidates to attempt the driving capability screen, offer them coaching and suggestions on how to improve their performance on the test, and then the chance to re-take the test. 

The TL;DR summary of all this? Walmart has a problem filling an important job so they are taking major steps to increase the candidate funnel by changing a key element of the screening process, and are throwing more cash at the problem to try and convince more job seekers (who continue to enjoy a strong labor market), to accept and remain in these truck driver positions.

Let more people in the door, offer them more money to stay. Pretty simple, let's see how it works.

Have a great week!

The challenge of recruiting for a job we think is going away

If there is one job in the American labor force that presents an incredibly interesting, complex, and important case study on supply and demand, price economics, the impact of automation on work, and the current and future labor force it is the job of commercial truck driver.

A couple of important statistics to keep in mind before we wade into some of the details that make commercial trucking so darn interesting, (at least to labor market and automation geeks like me).

According to the American Trucking Association there are about 3.5 million commercial truck drivers in the US. And 71% of all the freight tonnage in the country is moved by truck. Finally, according to the BLS, truck drivers earn an average of about $24 an hour, and have an average age of about 55 years old.

There are a couple of other factors specific to commercial trucking that tend to make it a difficult job to perform and to recruit for - traditionally new entrants have had to fund their own, expensive training and certification, for new drivers, the hours and time away from home are significant, the job itself is stressful, hard, and tends to foster really unhealthy habits, (poor sleep, fast-food, little exercise), and finally, and perhaps most importantly, commercial truck driving has been increasingly seen as being a job that can and will soon be replaced and disrupted by automation. Estimates of the impact of automation on commercial truck driving vary, but one representative example from Goldman Sachs, estimates that as many as 300K trucking jobs will be lost annually, once self-driving trucks become more widely adopted.

Factor all of this in, the hard lifestyle, the relatively low pay, the looming threat of automation making many of these jobs redundant - oh, I didn't even mention the federal regulations making most of these jobs not available to workers under 21 and the strong market for alternative jobs in construction and energy luring many of the trucking industry's target candidates - and you would probably bet that the US economy is not producing as many new truck drivers as it has in the past.

And you would be right. But the problem of many US companies, (and consumers), is that while we wait for Elon Musk's fleet of autonomous semi-trucks to take over American highways, and in the age of increasing demand for shipments (driven by the strong economy and Amazon Prime), the industry is seeing an increasing shortage of commercial truck drivers.

Here's a chart from the American Trucking Association illustrating the problem facing the trucking industry shown as the estimate of unfilled truck driver jobs:

According to the ATA's estimates, there could be as many as 180,000 trucking jobs unfilled within 10 years. And that kind of a shortfall, should it indeed play out that way, will have a pretty significant ripple effect throughout large swaths of the economy.

Wages and benefits for truckers, which have been increasing steadily, will have to continue to rise. The transportation companies will have to pass these costs to their customers - manufacturers and retailers and commodity producers - who will past them on to their customers, who will pass them on to you and I. And the development timeline for the kinds of autonomous trucks that might stand in for the human truck drivers will have to accelerate.

But in the meantime, at least the next 5 or 10 years, if the current trends hold, the US economy and labor market is going to have to find a way to recruit and retain more truck drivers. And lately, it seems like the transportation and other companies have not really cracked the code on just how to do that.

A tough job, with lots of stress, with relatively poor to average pay, that we keep writing breathless stories about how it will soon be made obsolete by technology, with an aging cohort of workers currently in place, might represent the toughest recruiting challenge in recent memory.

Sure, everyone likes to think 'tech' recruiting is hard, and it probably is. But I would wager a good commercial trucking recruiter would be worth their weight in whatever it is their company needs to get from one side of the country to the other.

Anyone out there doing this kind of recruiting? Would love to hear how it is going on the front lines.

Have a great week!

Self-driving bus crashes, proving all buses should be self-driving

In case you missed it, a fairly significant pilot of self-driving vehicles, in this case shuttle buses, launched last week in Las Vegas. In this test, shuttle buses developed by French company Navya ARMA will carry passengers along a half-mile route in downtown Las Vegas, (that part of Vegas that most of us who go to Vegas for Conference and conventions tend to ignore). The Navya ARMA buses rely on GPS, cameras, and light-detecting sensors in order to navigate the public streets. According to reports, the year long test hopes to shuttle about 250,000 passengers up and down the Vegas streets.

Pretty cool, right?

Guess what happened in the first couple of hours after launching the self-driving pilot program?

Yep, a CRASH.

The first self-driving bus was in a minor accident within a couple of hours of the service's launch when a (human driven) delivery truck failed to stop in time and collided with the stationary shuttle bus.

According to a spokeperson from the American Automobile Association, "The truck making the delivery backed into the shuttle which was stopped. Human error causes most traffic collisions, and this was no different."

No one was hurt, the damage was minor, and the self-driving pilot program continues in Las Vegas.

Why bring this up, especially on a blog that at least pretends to be about work, HR, HR Tech, etc.?

Because these kinds of technology developments, of self-driving vehicles, robots that can sort and organize inventory in warehouses, robots that will greet and provide basic customer services in retail environments and hotels, are being developed, improved, and deployed at increasing rates and in more and more contexts.

Self-driving technology in particular, especially for commercial vehicles, is by some estimates within 10 years of becoming a mainstream technology, potentially displacing hundreds of thousands of commercial truck drivers. And as an aside, this piece describes how the trucking industry is clearly not ready for this and other technological disruptions.

This is not meant to be another, tired, 'Robots are taking our jobs' post, but rather another reminder that technology-driven disruption will continue to change the nature of work, workplaces, and even our own ideas about the role of people in work and the economy. And HR and HR tech leaders have to take a leading role in how, where, when, and why their organizations navigate these changes, as they sit directly at the intersection of people, technology, and work.

And lastly, if that Las Vegas delivery truck had been equipped with the same kinds of self-driving tech that the Nayva ARMA bus has, there is almost no chance there would have been an accident.

But it might have be fun if it happened anyway. I'd love to see two 'robot' trucks argue with each other on the side of the road about which one was the doofus who caused the accident.

Have a great day!

Notes From the Road #21 - Friendly Skies Edition

I was waiting for an early morning flight today (on Delta, the best airline in the world), and heard a gate announcement from across the terminal for a United flight that was also soon to depart. The United gate agent was seeking volunteers to give up their seats on the 6AM flight to Chicago and take a later flight. With everything that has been in the news about the recent problems United has had with overbooking and removing passengers from flights, I couldn't help but wince a little as I heard the announcement. And I wasn't even on the flight. Nor that airline. Just the stench of what has been going on at United wafted across to my Delta gate. Aside - my Delta flight also was seeking folks to volunteer their seats as well. Must have been a big day to get out of Rochester today.

But the announcements this morning, and the United follies of late made me think I hadn't done a 'Notes' post in a while, and since I KNOW you must have been waiting, on edge, for me to share my thoughts on the United stuff and air travel in general, here are my frequent flyer informed Top 10 observations/comments on the current state of the friendly skies...

1. On the United stuff - pretty much everyone was at least partially in the wrong there. United operations should have a better plan to get its employees where they need to be. United gate staff and on-site managers should have had more leeway to increase the compensation on offer in order to coax the desired number of passengers from the flight. Airport/aviation security should have found some other way to accomplish the de-planing of the passenger that did not involve concussions and a busted up face. And finally, despite the unfairness of it all, the passenger in question, once three airport security staff boarded the plane and requested he de-plane, had to comply. He should have been mad. He probably should have dropped a F-bomb or two. But he should have left the plane and taken up his case back at the gate. On board an aircraft trapped with 100 other folks in close quarters who have nothing to do with this incident is no place to decide to hold your own sit-in protest. 

2. I think an underrated element of the air travel experience is the newness of the aircraft itself. The plane I am on now is really, really new seeming. It almost has that new plane smell still. Creates such a positive feeling right from boarding when the plane is new(ish), and not one of those dreary, run-down, relics from 1987. 

3. I know this is easy to forget, but another thing that would make the overall experience better is for everyone to realize that you are not the only person on this flight, and unless you are the pilot, you are also not the most important person on this flight. You know what? We all have connections to make! We all sat through the turbulence over Colorado. We all had to endure the four hours to LAX with the terrible wifi. Treat everyone nicely, we are all in this misery together.

4. But given that we are all miserable, we can't take that out on the individual employees of the airline - gate agents, flight attendants, customer service folks - any of them. Ninety-five percent of the airline staff are giving their best effort to get us where we want to go - safely, on-time, and as comfortably as conditions, (which none of them created) allow. Sure, can an airline worker have a bad day? Be rude? Of course. But so can the guy at the gas station, the clerk at the DMV, and the passenger in Seat 17C who keeps hitting the call button to ask for another ginger ale. 

5. Air travel is a volume business. Delta, American, Southwest, and United, (the Big 4), might carry 125 million passengers each year. If they are lucky, they will make $6 of profit on each passenger (it is often less). So even if you think your $1700 fare to SFO was really expensive, the airline barely makes enough to cover the costs of getting you there. So like your local grocery store, volume and thin margins is how airlines make money. I think some of the disconnect in the air travel experience is we see our fares as big-ticket purchases, but the airline sees us all as contributors of $6 to the bottom line.

6. It is never a good idea to argue with the TSA. See point #4 - the person manning the scanner or waving the magic wand or doing the patdowns did not make the rules. The process is often ridiculous, but the time and place to make your stand is not at 5:30AM with 72 people in line behind you who just want to make their flights. Write your Congressperson if you don't like what goes on at airport security.

7. No matter what scheme an airline uses to manage the boarding process, (line up with numbers, line up in groups, high status first/lower status next, etc.), boarding will be probably the worst aspect of the flying experience. This is mostly our, (the collective we) fault. We lug too many things on the plane, we can't count rows, we have to position phones, tablets, e-readers, magazines, boxes of Good n' Plenty just so at our seats before we sit down. Just please, for the love of all that is holy, stash your bag under the seat, don't try to stuff the roller bag where it clearly will not fit, and just sit down. There is nothing more likely to make you weep for humanity than to watch 120 of us attempt to board a plane.

8. You do not, under any circumstances, need to make a phone call telling someone 'We just landed' the SECOND after the wheels touch down. I promise you that call can wait 7 minutes until we are at the gate and getting off the plane. Trust me.

9. Your bags will almost certainly not get 'lost' or even delayed. In 2015 the USA rate of lost luggage was about 3 per 1,000 passengers, a 10% reduction from 2014. Delta (and American I think) now allows you to track the movement of your checked bags via it's smartphone app. I get a little notification when my bag gets placed on the plane, when it is switched to my connecting flight, and when it is unloaded at the claim area. Will you be one of the 3 out of 1,000 who has an issue with your bag? There's a 99.7% chance you will not. So get over that one time in Indianapolis nine years ago when your bag went missing and it had to be delivered to the Fairfield Inn a couple of hours later. You were fine.

10. There are going to be times where you miss your flight, when weather or mechanical issues cancel the flight, when you are stuck in a middle seat between two guys who are the size of a WWE tag team, or when there's a crying baby, no wifi, or the plane has run out of red wine. That is just how it is. But remember none of those things are happening to you, they are happening to all of us too.

And it could be worse. Remember that 27 hour drive to DisneyWorld when you were a kid? And Dad threatened to turn the car around about 19 times? And your brother got car sick on your Keds?

Think about that compared to that crowded, stuffy, 2 hour 32 minute flight where you watched Moana and had some honey roasted peanuts and a Sprite.

That's it, I am out. Safe travels out there.

Uber, surge pricing, and data at work (at work)

The on-demand black car service Uber took quite a bit of flack over the weekend for implementing what is known as 'surge pricing' during a pretty nasty snowstorm in New York City. If you are not familiar with Uber, (and you should be because it really is an amazing service), the basics are pretty simple. Users use a smartphone app to summon a black car or equivalent that picks them up and then are taken to their desired destination. The entire payment transaction (including leaving the driver a star rating) is executed via the app, for prices (at least in my experience) ranging 15-20% more expensive than 'regular' taxi service.

But during times of extremely high demand for rides and low supply of on the road drivers (like on a Saturday night in a bad storm), Uber implements 'surge pricing', essentially increasing the cost of rides anywhere from 2 to even 6 or 7 times the normal fares in order to balance demand with supply. The ECON 101 logic is pretty simple - the increased prices (which users are warned about in advance of booking a ride) will serve to simultaneously reduce demand while increasing supply, as more drivers will be enticed to get out on the road in order to earn increased fees during the surge pricing period.

In addition to using basic pricing flexibility to manage and try and balance supply and demand, Uber also is attempting to mitigate the one really frustrating piece of the typical customer's experience, (I can attest to this one), which is the simple lack of availability of a car when you need/want one.

But the backlash from last weekend's surge pricing in NYC seemed pretty harsh as people took to Twitter to vent about their frustration with Uber for radically increasing their prices during a time of "crisis" in the city - it seems like there were scads of celebrities that were particularly peeved about having to pay what they felt like were exorbitant prices for transportation around town.

Putting aside the natural lack of sympathy I have for anyone complaining that their on-demand, door-to-door, black car service costs too much (on a Saturday night in the busiest city in America and during a snowstorm), I wanted to highlight this story as one of the very few that we see that showcases how data, technology, and the combination of the two are actually conspiring to benefit the front-line worker - in this case the Uber affiliated black car drivers.

Normal taxi drivers or even limo drivers might see a little extra in their pay rates for working a Saturday night, but certainly could not take advantage of the dramatic increase in demand for their services as the Uber drivers who braved the storm were able to realize.

Through a combination of new technology, absence of the pricing regulations imposed on traditional taxi services, more flexible labor rules, and most importantly, the presence of information of the increased demand, these Uber drivers were able to make better and hopefully, more informed, data-driven decisions about whether, where, and when to provide their services.

Most front-line workers never really get the exercise the kind of labor pricing power that we see in this example. Last Saturday night lots and lots of pretty well-off people wanted black car service on one of the worst weather nights of the year. The kind of night that most folks would rather stay home and stay warm, much less venture out into the cold and wet and storm to work for their normal pay.

Thanks to data and technology at least in this example, the Uber drivers who did venture out into the weather did a little better than most front-line workers.

It looks like they were paid what they deserved. Which is not always easy to say, both for black car drivers and for the celebrities they ferried up and down Manhattan last Saturday night.