There's No Shortage, Just A Price You Don't Like
In the absence of government meddling (e.g. price controls) healthy markets seldom create true shortages, meaning situations where one simply cannot obtain a product or service. One might think there was a shortage, for example, of Superbowl tickets, since there are only a few available and tens of thousands, maybe hundreds of thousands, of people who would like to attend. But in fact one can Google "Superbowl tickets" and find hundreds available. You may not like the price ($3500 and up for one ticket), but they are available for sale.
Yesterday, the AZ Republic lamented that there is a shortage of truck drivers nationwide:
Trucking companies across the country are facing a shortage of long-haul drivers....
High driver turnover has traditionally been a problem throughout the
trucking industry. But retirements and growing shipping demand have
made the shortage of long-haul drivers more acute. Fewer drivers means
delayed deliveries and higher delivery costs that could be passed on to
consumers. The
issue is especially crucial for the Phoenix area, which touts itself as
a shipping hub for businesses fed up with the costs and congestion
around Los Angeles-area ports. The Valley also is headquarters to two
of the country's biggest for-hire trucking companies: Swift
Transportation and Knight Transportation....Trucking experts say the problem goes beyond a labor shortage in the industry. They call it a threat to the economy.
"Our country needs to figure out how to fix this," said Ray Kuntz,
chairman and chief executive of Watkins and Shepard Trucking in Montana
and chairman of American Trucking Associations. "Our economy moves on
trucks."
Here is the key fact:
"¢ Long-haul wages vary by company and are typically based on
experience, safety record and commercial-driver's-license endorsements.
Long-haul drivers with two or more years of experience usually earn at
least $50,000 to $60,000 a year."¢ An entry-level driver with no over-the-road experience starts in the high $30,000 range. Team drivers can earn more.
There is no way in a Platonic vacuum to determine if a wage is too high or too low. But the driver "shortage" gives us a really good hint that maybe these salary levels are no longer sufficient to attract people to the rather unique trucking lifestyle. I probably could write a similar article about how there is a shortage of Fortune 500 CEO's or airline pilots who will accept a $30,000 starting salary. The problem then is not shortage, the problem is that wage demands are rising as trucking is out-competed for talent by alternative careers. In fact, there is not shortage, but a reluctance by trucking firms to accept a new pricing reality in the market for drivers.
By the way, to some extent this "shortage" is indeed an artificial creation of the government. Under NAFTA, Mexican truckers were long-ago supposed to have been given access to the US market, but overblown safety concerns have been used as a fig-leaf to block the provision as a protection for US truckers and a subsidy to the Teamsters. If a truck driver "shortage" is really a national economic problem, then let's stop blocking this NAFTA provision. But my sense is that the trucking companies in this article would freak at this, because they are not really concerned about the national economy but, reasonably, with rising wages hurting their bottom line. My guess is this article is the front-end of a PR push to get states like Arizona to subsidize ... something. Maybe truck driver training. Look for such legislative proposals soon.
