Where is the talent?

Abstract

The lack of talent among the recruits in the American Trucking Industry is causing detrimental effects to the American economy. Trucking sector contributes to about 5.6 percent of total America’s GDP. The lack of talent in the young American generation has made it difficult for HR to hire qualified personnel who can meet the job thresholds. This research will consider one of the most crucial and overarching questions: Where is the talent? This question will enable the research to explore the overall trucking industry in the US. The research will thus consider one of the most likely factors leading to the lack of talent in the trucking industry. The system of education and stigma will form the peripheral areas of research regarding the overarching question. The research will utilize the resources from existing research to build on its overall argument on the reasons why the industry lacks talents. Data from the Bureau of Labor Statistics (BLS), American Transportation Research Institute (ATRI), American Society for Training and Development (ASTD), and the Fleet Advantage reports have been utilized in the research to explain the background concept regarding the lack of talent in the trucking sector.

1.0  The shortage of Mechanics and Techs in the American Trucking Industry

The world of business and entrepreneurship today faces several challenges, which impedes and compromises effective competition in the global market. Such challenges include the inadequate workforce, which fails to meet the company’s required work threshold for the production of goods and services. While inadequate workforce is vehemently to blame for low-quality products, studies have emerged, which focus on the structure of the workforce itself. In many instances, the workforce itself lacks the required skills for the production of goods and services. One industry which faces similar problems is the American Trucking Industry. The trucking industry serves the American economy by the transportation of raw materials, and finished goods. Trucks are also used in construction sites to transport the portable concrete mixtures. Existing evidence from the various human resources personnel puts the American trucking industry on the verge of collapsing due to inadequate talents among the mechanics and techs. Several types of research have also alluded to the fact the industry indeed, lack talents among the existing mechanics and the techs. This shortage of talent in this sector is food for thought for the federal government, and the head of various states. Otherwise, the economy of the United States is bound to face several economic threats. The American Trucking Industry is one of the most significant contributors to the US’s Gross Domestic Product (GDP) without which; the economy is bound to face tantrums. The lack of desired talents has led to the shortage of the technicians, and mechanics in the American Trucking Industry.

2.0 Identification of the Problem

Many corporate Human Resource persons face various challenges while looking for talents to replace the aging workforce in their organizations. Lack of expertise in many companies has great economic impacts. The lack of talent also makes it difficult for the HRs to hire qualified personnel as the management anticipates. For this reason of the lack of talent in the American trucking industry, many HR have a difficult time hiring qualified commercial truck drivers, and mechanics. The applications are nothing short of terrible. Without adequate, and qualified staff, transportation services suffer as most companies are not able to service their customers. If the product is limited and creates a shortage, the pricing of the product becomes somewhat elastic based on transportation. The strategic thinkers in the industry have also failed to develop concrete plans for such companies. The same problems of lack of talents were not focused by the early strategic thinkers leading to the current status quo. The situation now requires strategic thinkers so that the future trucking companies will not suffer similar consequences.

3.0 The significance of the Study

For close to a decade now, the trucking industry in America has been experiencing problems with unskilled staff among the techs, and the mechanics. The trucking industry is one of the industries pivotal to the success of the economy of a nation. In everyday life, the manufacturers of goods and services would want their products to reach consumers in the most efficient ways. Bearing in mind the competitive nature of the world of business, every management work around the clock to meet the growing demands among the consumers. Take an example of a truck delivering motor vehicles to Jacksonville breaking down along the way due to improper engine service. The manufacturers who a times hire these services will lose trust in the services rendered by the trucking industry. Trust is one of the most fundamental aspects of the world of business. Lack of trust leads to drastic depreciation of the overall profits from the goods delivered, and thus detrimental to the success of the trucking company. Such unprecedented breakdowns result from unskilled mechanics, technicians. The United States and its trucking industry are in the same quagmire, and the situation needs to be reverted with the slightest recommendation to subvert the case. This research will look at the broader aspect of lack of talents in the trucking sector in the US while narrowing to the possible solutions.

Talent is significant in any business sector. The various management and business owners must identify the existing talents within the workforce to foster the production of goods and services. The study will also be significant in addressing how the trucking industry in the US addresses the issues of the shortage of technicians, and mechanics in the fields related to the trucking industry. Upon shedding light on the missing gaps in the trucking industry, the study will give recommendations, and necessarily solutions to the problem. A point worth acknowledging is that since the issue of lack of talents in the trucking industry was first hinted in the 2006 summit, no amicable solutions have solved the problem. The US is now at the realm of losing billions in the trucking industry as evident from the list of top ten trucking companies in America by millions in 2016.

       3.1 Table 1: Top Ten Trucking Companies in the US

The table above reveals the amounts by revenue the trucking companies are injecting into the economy of the US. Some of the companies have experienced lack of talents for more than the last five years.

4.0 Literature Review

4.1 Job Search Theory

The job search theory tries to explain the mismatches in the labor market by referring to the current imperfect information, and the costs for job search. This theory can explain the current situation in the trucking industry in the US. Roy asserts that aspirants do not possess the perfect information while looking for jobs (Roy, 2010). Such information regards the nature and characteristics of the job. As Torrey et al (2014) points out, the job search theory may perhaps be a great tool for HR to understand the nature of the various job applications. The lack of talents in many industries has been associated with young people not coming out to replace the aging workforce. But Rodrigue and Notteboom (2010) argues that most young applicants have limited job-search experience, and networks to land them at the right companies. This lack of access to job lessens their probability of landing the desired jobs. Trego and Murray also highlights the pressure to accept a job as another reason why the trucking companies in the US may not have the right talent for mechanics, and the technicians (Trego & Murray, 2010). The pressure to accept the job because of the mounting costs associated with the prolonged searches increases the likelihood that a worker may take the job not based on merit.

4.2 Labor market segmentation

The concept of the labor market segmentation was developed by the findings of Reich in 1973 (Clevenger, 2012). Today, American society continues to cry foul of the lack of talents in the trucking industry. The founders of this theory argued that the political, and economic forces, which were historically vested within American capitalism resulted in the segmented labor markets. The sources of the segmented markets are not exogenous to the economic systems in the US. Reich further mentions that the segmentation of the labor market was a process, which was economically, and politically influenced to encourage the labor market segmentation. Clevenger argues that it is difficult to explore additional talents in a segmented labor market (Clevenger, 2012). He bases his reasons on the fact that segmentation is not a proper method of harvesting skills from the minority in an economic society. The division of labor which results in such segmentations was also not a proper way of harnessing the talents required from employees.

The segmentation of the jobs within the primary sector also resulted in the alignment of the courses in the education systems of the US. Johnson et al (2010) argue that amicable education systems tend to borrow from the existing job markets. After all, no college graduates would like to hold titles and become jobless. The subordinate versus independent did the job segmentation in the primary sector. In this classification, Miyoshi and Kii further assert that the subordinate jobs are the factory and office jobs, whereas the independent jobs are those that have attached professional standards for work (Miyoshi & Kii, 2011). Roy (2010) further mentions the third segmentation of jobs based on the human races. In this category, certain jobs were fueled by prejudice, and the labor market institutions. Nevertheless, Clevenger (2012) does not make it clear where the required talents in the trucking industry fall. The evident fact is that the job market segmentation also influences such talents just like in other jobs.

4.3 The inadequacies of the human capital theory

The human capital theory in a general view considers education as a form of investment, where there is a comparison of the opportunity cost of education to the direct, and indirect psychic to future benefits (Williams et al, 2017). This idea is derived from Adam Smith, who mentioned that the investment in education, and the formation of skill in an individual are important factors in economic growth. Individuals continue to invest in education until there is equality in the marginal benefits, and the marginal cost. Additionally, Levanon et al (2014) assert that human capital can be treated as a form of capital. The investment in knowledge, and skills will benefit individuals since it can lead to an increase in the economy, and the human capital pool for potential productivity. Thus, the investments made on a person’s skill, and well-being can lead to the accumulation of human capital. Such investments include job training, and education. Carnevale et al (2010) argue that the procurement of greater levels of schooling leads to increased productivity in individuals.

4.4 The need for more Technicians

According to the Technician Wage Survey conducted in the US in 2018 by Randall, a commercial carrier company, every ten trucking industries consisted of at most three experienced talents. This number amounts to about 30 percent of the qualified talents among the techs and the mechanics. Similar assertions were made by the US Bureau of Labor Statistics (BLS). According to the bureau, the trucking industry will be required to employ about 65,000 technicians by 2022 due to the high turnover, and the growth in the fright volumes (Kellermann et al, 2013). The bureau further suggested the inclusion of the diesel engineers over the same timeline.

According to the American Trucking Association’s CEO, Bill Graves, the industry needs comprehensive logistics and technology applications in its daily works because the sector is fundamental to the growth of the US economy. Roy asserts that the trucking, and freight services in the US contributes about 5.6 percent to the total Americas GDP as of 2017 (Roy, 2010). Transportation in the US measures the share of all the expenditures on the transpiration-related final goods, and services, otherwise known as the final demand for transportation. In similar statistics from the Bureau of Transportation, the wholesale, and retail businesses depend on transportation for the delivery of their finished products. As at the fiscal year of 2016, these sectors used transportation services totaling to about 227.8 billion dollars.

4.5 The 2006 Year Summit

In the 2006 year summit, there was the first identification of the shortage of skilled mechanics, and techs in the American trucking industry (Koirala¹ et al, 2016). The identification of the shortage would then shape the industry into today’s unfortunate position assisted by some factors. Some of the factors according to Roy (2010) include the aging generation, which for decades, have led the industry. Clevenger (2010) mentions that there is not enough working baby boomers to cover the aging workforce in the industry. In 2017, the industry added about 2,300 diesel techs to cater to the ever-growing volumes of the freight services. For the same reason, the year 2018 also witnessed similar increment in the number of techs. Nevertheless, according to Williams et al (2017), the increase in the number of personnel without the required skills is still a negative notion. Miyoshi and Kii (2011) identify talent as the core of all the problems the industry is facing in the current world of business. Rodrigue and Notteboom (2010) assert that effective entrepreneurial skills must be accompanied by complete ability to perform the required task. Entrepreneurship is about innovation, and innovation is about skills. The sector in use is facing turbulences because of lack of required skills among the current workforce composition.

The American Transportation Research Institute (ATRI) released the top industry issues reported in October 2017. Acceding to this report, 87 percent of all the transportation industry in the US needed more technicians, and mechanics in their daily operations. According to the ATRI report, trucking needed more technicians, and mechanics than any other sector (Trego & Murray, 2010). The growing demands of the skilled techs, and mechanics send rippling impulses to the other sectors about the structure, and the composition of the workforce. An article published on the Cameco Cooperation (CCJ) news elicited the discussions on the 2016 Technology and Maintenance Council (TMC) annual meeting that year. Three years later, Carnevale et al (2010) assert that the same issues highlighted on the CCJ News came back to haunt the American Trucking Industry. Some of the top trucking companies in the US are not spared either.

4.6 Impacts of Education

Clevenger (2010) attributes the decline in the technician shortages to similar instances, which led to the decline in the mechanics, and techs in the aviation industry. According to Torrey et al (2014), the decline in the aviation industry was majorly caused by the shortages of the mechanical courses at college, and university levels. Besides, Johnson et al (2010) argue that the current American culture, and courses are much pegged on the arts rather than science. Thus, the younger generation tends to focus more on the artistic culture in American society. A survey conducted by Boston University to identify the reasons why more students prefer arts to science, more than half of the participants mentioned their reference to arts courses because they are less involving, and they are full of fun. This survey is just one among the many studies out there, and perhaps which have not been published for public consumption, but contains vital information. Torrey et al (2014) suggests that the government of the United States must act promptly to this gripping fear of depreciating talent in the mechanical, and the technology sectors. Due to the small numbers of the available mechanics and techs, all the sectors in the US share the numbers on the list of reference based on the revenue income. The small number of techs and mechanics would prefer working for the aviation industries to trucking industries because of the deviation in the salaries.

Finding the applicants to these positions is a half battle for the trucking companies. According to Carnevale et al (2010), the fact that truck fleets struggle to fill the vacancies in their repair bay, and retain the technicians is indisputable. The high skilled-blue color labor is becoming a rocket science for most trucking companies from driving to fixing issues related to mechanical problems. Torrey (2014) puts blame on the American system of education. According to his assertions, there are many graduates out there walking with four-year degrees in some of the required fields (Torrey, 2014). However, the system of education did not teach them to get to the bottom of the vehicles when there is a mechanical problem. The problems they addressed were merely paperwork.

5.0 The technician and mechanics’ shortage as a catastrophe

The shortage of technicians, and mechanics is growing daily at a fast rate. With this daily growth, there are several calls for a wholesale overhaul to the recruiting, and hiring process for the trucking industry. The shortage of the mentioned professions is becoming a catastrophe in the American trucking industry (Levanon et al, 2014). Over the next two decades, about 75 million baby boomers in America will face retirement from various sectors. Among these, about 2 million baby boomers are from the trucking industry. Similar statistics indicate that only 45 million recruits will be set to replace them according to the American Society for Training and Development (ASTD). The deficit in the workforce will also imply the trucking industry will also have the deficit. One of the biggest challenges facing the trucking companies in the US today is finding, and keeping the technicians (Johnson et al, 2010). The trucking industry needs technicians in the fuel sector, which so far, has been a nightmare in this industry.

Due to the growing complexities of trucks, finding and training technicians, and mechanics are becoming more intricate. The design of the US educational system makes the process more difficult. The system prioritizes attending college over the pursuit of vocational training. Improvements have been made to make truck driving and technical jobs in the related fields to be well paying (Johnson et al, 2010). However, the reception among the new hires is not commensurate to the anticipated positivity. Keeping the fleets running effectively requires a strong team. The drivers, maintenance techs, and the mechanics must work together to keep the trucks on the roads. Two factors primarily cause the shortage of talents in the trucking industry in the US. As mentioned before, the baby boomers in the industry at this generation are nearing retirement. They include many seasoned techs who have survived in the industry for decades causing the evident loopholes. The second factor is the stigma surrounding the career itself (Levanon et al, 2014). Few younger people in the generation pursue the required training. Consequently, no enough workforce coming to the full ranks to fill the gaps created by the baby boomers, thus creating the shortage.

The shortage has had several impacts on both the economy and on the normal running of the industries. It’s more obvious how the shortage will affect the fleet industry. Nevertheless, it is not obvious how the shortage will directly affect fleets (Trego & Murray, 2010). Fleets that incline to employ their mechanics will find it hard to employ recruits to fill the openings. Such management will work harder to keep the few techs, and the mechanics happy in their positions. The fleets which cannot get the techs and the mechanics to keep on staff will go for outsourcing maintenance from the nearby similar businesses. The outsourcing implies they will have to wait for the repairs if the demand is higher than the number of the techs available (Johnson et al, 2010). Thus, the overall effectiveness of the fleets is at stake. As fleets will try to minimize the number of breakdowns, preventive maintenance will become more important. The shortage of techs and mechanics has also led to increasing maintenance and repair (M&R) costs for many companies in the US.

6.0 Inadequate techs and Mechanics, and the associated M&R Costs

A report released by Fleet Advantage on March 26th, 2018, indicated the rising cost on class-8 Fleet M&R. This report pegged the rise to the lack of adequate skilled personnel who can identify the volatile cost of fleets operation. In this press release, Fleet Advantage, which is the leading innovator in the truck fleet business analytics mentioned that equipment financing, and the lifecycle cost management requires informed techs, and mechanics who will identify the best lifecycle for the new trucks in the market, and comparing it with aging trucks (Miyoshi & Kii, 2011). The section of the lifecycle strategy in the report gives the savings a company can make if they go for the new 2019 model-year truck at the expense of the 2012 sleeper model year as shown on the table.

6.1 Table 2: 2019 Sleeper- M&r Cost Comparisons

From the table above, the Fleet Advantage analytics shade more light on the depreciating costs in the M&R savings from 2012 to 2019. The decline in the savings for the maintenance and repair costs speaks volumes about the effectiveness of the current techs and mechanics. The findings are coherent with the assertions that the lesser the techs and the mechanics, the more a company spends in the truck maintenance costs, thus the fewer savings. The analytics also covered the M&R costs for different truck lifecycles. In this regard, a shorter lifecycle produces a long-term saving past the first-year. The fleets should thus adopt the three-year life-cycle for the trucks.

7.0 Recommendations and Conclusion

7.1 Recommendations

The first course of action regards the education system in the US. John Flynn, the CEO of the Fleet Advantage mentioned during the press release that there is the need to factor in grammatical terms regarding technology and mechanical works at the high school levels. The recommendations followed the claims the most of the new hires in the trucking industry were still not into grammatical conscience with the technical terms. As this proposal comes in, the government of the United States needs to adopt more of the vocational training for the techs and the mechanics. The courses should not just focus on the paperwork but also practical approaches. Quality training for the recruits is the fundamental key to solving the acute shortages. Still, on the education system, the students who study technical course should get attached to the trucking companies every three months of their study. The attachment will ensure they get the necessary training from the aging, and experienced baby boomers.

The industry needs to recruit more techs and mechanics with talents. To do this, the stigma and the perception of the job must change. The stigma that the tech, and mechanical jobs at the trucking industry are for the less learned is what is slowly killing the spirits of the youths towards perusing the related courses at colleges and universities. The various management for the trucking companies needs to make the tech and mechanical jobs more paying to attract more talented new hires. If the pay for the techs and mechanics is increased to the levels of some white collar jobs, more talents will encroach the trucking industry. The HR of various industries must utilize the experience in the baby boomers. One way of utilizing the experience is by attaching every aging, and experienced baby boomer to a recruit. The recruits will receive adequate training required in the tech and mechanical jobs in the trucking industry.

7.2 Managerial Implications

The managers and the HR for the various companies must effectively engage the new hires. One way of such engagements is by ensuring the recruits receive adequate training. This will surpass the assumptions that colleges provide adequate training. Every management and HR must ensure the recruits receive adequate company training. In this regard, before the recruits get into the real job, they will need several training workshops exposing them to what is required of them in the trucking sector. The managers must also ensure the job soothes with good salaries as previously mentioned.

7.3 Conclusion

Talents in the American trucking industry will be a major blow to the economy of the US shortly. The economy of the US is a greater stake owing to the fact the baby boomers will not have a quick replacement in the trucking industry. Lack of talents in this sector among the techs and the mechanics has been a long-term source of headache for many HR departments in these industries. Hiring has been made tremendously difficult. Some authors have endlessly put the education system of the US to blame for lack of talents in the trucking industry. The trucking needs techs in the various fields such as the diesel techs. As the industry run into the acute shortage of mechanics, the diesel techs are also needed in these industries. Most companies lack the diesel technicians.

The ATI contributes to the overall GDP of the US, and thus the lack or inadequate workforce among the techs and the mechanics will greatly affect the economy. Various authors have tried studying the central problem leading to the lack of techs and mechanics. Most of the findings link the issue to the education systems. Most of the college technical courses are merely about paperwork. The education system also lacks vocational training for the upcoming techs and mechanics, thus rendering them ineffective in the field. The lack of technical knowledge of the trucks also leads to increased M&R costs, and thus reducing the M&R savings. Companies undergo tough economic situations due to the lacks of the desired talents, which can identify the proper maintenance timeline for the new trucks.

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