media center

America's Shipping Crisis Isn't Over & Policymakers Shouldn't Make It Worse

Make no mistake about it, businesses across the country are still struggling to recover from America’s supply chain crisis, which the National Association of Chemical Distributors (NACD) has been sounding the alarm about for over two years now. Chemical distributors have been hit with increased delays, costs, detention, and demurrage fees, skyrocketing fuel prices, increased cost of equipment, and so much more.

A crucial part of our nation’s supply chain struggles relates to trucking. Already, the trucking industry is responsible for moving about 72.5 percent of all freight, according to the American Trucking Associations. And, according to the Federal Motor Carrier Safety Administration (FMCSA), 87 percent of all fleets operate six trucks or less, and approximately 95 percent have fewer than twenty trucks. Single-truck motor carriers represent nearly half of all active motor carriers operating in the United States today.

Chemical distributors rely on this shipping method to transport their goods quickly and cost-effectively. However, persistent truck driver shortages and turnover/churning in the industry have negatively impacted this mode of transportation for chemical distributors and other shippers because without trucks and professional drivers on the road to transport them, goods don’t move.

At the federal level, Congress did take a small step to alleviate America’s trucking woes by including the Safe Driver Apprenticeship Pilot Program in the Infrastructure Investment and Jobs Act of 2021. The pilot program allows employers to establish an apprenticeship program for certain 18 to 20-year-old drivers to operate commercial vehicles in interstate commerce. This was welcomed action by Congress but by no means a silver-bullet solution to enticing workers to become professional truckers. More is needed, of course, to include stakeholders and make sure the administration follows Congressional directives to invest in maintenance, upgrades, and additional capacity to U.S. surface transportation – roads and bridges, including robust investment in truck parking facilities; and policies that truly acknowledge the men and women who drive our nation’s economy.

Unfortunately, states are now implementing policies that could further undermine trucking while the industry is still struggling. AB5 in California, for example, would damage the independent contractor (IC) model for trucking that more than 70,000 owner-operators in California alone, alongside hundreds of thousands more across the U.S., call their business and which our country’s economy relies upon. Small businesses choose to utilize this model because it affords them freedom and flexibility, but AB5 will put a damper on truckers’ desire to run their own businesses while driving up costs, increasing regulatory burdens, and creating further delays in our supply chain at a time when businesses can least afford these challenges.

NACD members would also be impacted because they often utilize third-party brokers or contractors to get their shipments out of ports. Beyond chemical distributors, this is impacting other shippers by disrupting the supply chain even further.

NACD is supportive of efforts to improve working conditions for truckers. Businesses need solutions to America’s supply chain crisis, not laws and regulations that would make it worse. AB5 will inspire similar legislation in other states, and in the long run, this might hamper interstate commerce, making it more difficult for operators and owners to comply with these laws and stay in business too. The job of policymakers is to defend against our adversaries and promote national commerce through the seamless flow of goods. Let’s not get in the way of ourselves, creating A, B, and C tests, but rather allow opportunities for people to choose the work and career that best allows them to succeed and support their families.

Learn more about trucking issues by visiting NACD’s newly updated trucking policy issues page. If you have any questions or concerns about this issue, please do not hesitate to reach out to NACD.

You must be logged in to post a comment.

Click here to log in