In October 2022, the Fredericton Chamber of Commerce gained the support of the Canadian Chamber of Commerce with the approval of 100% of delegates of the 2022 annual general meeting and policy conference for the following resolution:
Issue
A lack of people working in Canada as truck drivers is causing supply chain disruptions and contributing to the current inflationary environment. The industry must attract, train and retain thousands of new truck drivers over the next few years to mitigate these issues and the current financial support provided for such trainees is insufficient to attract the required number of people to the industry.
Background
The trucking industry has had difficulty attracting new entrants to the industry for several years. There have been policy resolutions submitted to the Canadian Chamber of Commerce policy resolution debates over the past decade to address this very issue.
In the fall of 2021, the Canadian Trucking Alliance (hereinafter “CTA”) reported that approximately 23,000 vacancies for truck driving positions throughout Canada and estimates this number will more than double to 55,000 by 2024[1]. In the United States, there are approximately 80,000 vacancies[2]. The CTA wrote in April 2022:
Recent data relating to truck-to-load ratios shows between a 30%-45% decrease in the availability of trucks, year-to-year, while load volumes have more than tripled at times. As a result of these two factors, the number of trucks available per load has declined from about three trucks per load a year ago, to around 0.5-0.7 trucks per load today. In other words, almost one in every two available freight loads don’t have a truck (driver) for transport[3].
What was an issue pre-pandemic has now become a full-blown crisis, affecting most sectors and aspects of daily life through supply chain disruptions and inflationary exacerbation. The 2022 federal budget earmarked more than $600 million to address supply issues for infrastructure, data and red tape reduction. No doubt the solutions to our supply chain problems are multi-faceted but must include a plan to increase human resource capacity – particularly in the trucking industry.
The Bank of Canada’s 2022 Q1 Business Outlook Survey identified supply chain disruptions as one of two key factors adding upward costs pressure to consumers and businesses[4]. In the Charter Professional Accountants of Canada’s Business Monitor published in May 2022, inflation (22 per cent) and supply chain issues (20 per cent) were seen as the top challenges to the growth of the Canadian economy in the coming 12 months, with lack of skilled workers (11 per cent) and employee recruitment, retention and development (10 per cent) the next two on the list[5]. Each of these issues would be addressed in some way by increasing the trucking industry workforce.
One of the key issues preventing more individuals from entering training programs for truck driving is cost. Training program requirements vary from province to province, but many are 12 weeks in length. 12 weeks is also the minimum program length required to qualify for federal and provincial student loans, but even for those who would potentially qualify for a student loan, their funding would be for a maximum $5,950[6], while training and certification programs can cost $11,000 – $12,000 (and is currently increasing to compensate for the cost of fuel). This gap can be a significant barrier for many individuals considering entering the industry.
The federal government already plays an active funding role for training and upskilling in each province through Labour Market Development Agreements (hereinafter “LMDAs”) and Workforce Development Agreements (hereinafter “WDAs”) – every province and territory currently have both LMDAs and WDAs in place. This mechanism can facilitate dedicated funding to the provinces for trucker driver training through additional funding and/or direction to the provinces and/or a new unique fund – without requiring new bureaucracy or creating new funding mechanisms.
The current cost to the Canadian economy by supply chain disruptions dwarfs any additional cost for the federal government to provide additional funding for this purpose. For example, in March 2022, a Canadian Manufacturers and Exporters survey and reported that manufacturers alone have lost about $10.5 billion in sales because of disruptions in the supply chain and are now experiencing nearly $1 billion in increased costs[7].
Supply chains issues are not only deep, such as in the manufacturing sector, but also broad – the Business Development Bank of Canada (hereinafter “BDC”) reported in March 2022 that 85% of Canadian businesses were experiencing supply chain issues[8]. Addressing this issue through increasing truck drivers is important for every region and almost every sector.
Recommendations:
That the federal government:
- Work with the provinces to provide dedicated funding through Labour Market Development Agreements and/or Workforce Development Agreements targeted to increase Canada’s truck driving capacity through increased access to truck driver training programs.
[1] https://nationalpost.com/news/politics/ahead-of-supply-chain-summit-trucking-alliance-calls-for-help-filling-23000-vacant-driver-positions
[2] https://www.mcgill.ca/business-law/article/understanding-supply-chain-disruptions-during-covid-19-pandemic
[3] https://cantruck.ca/editorial-solving-the-truck-driver-shortage-is-an-investment-in-canada/
[4] https://www.bankofcanada.ca/2022/04/business-outlook-survey-first-quarter-of-2022/#chart1
[5] https://www.cpacanada.ca/en/the-cpa-profession/about-cpa-canada/media-centre/2022/may/inflation-supply-chain-issues-worry-business-leaders-cpac-business-monitor-q1-2022
[6] http://certification.esdc.gc.ca/lea-mcl/eafe-sfae/eafe-sfae-h.4m.2@-eng.jsp
[7] https://cme-mec.ca/blog/manufacturing-survey-nine-out-of-ten-manufacturers-experiencing-supply-chain-disruptions/
[8] https://www.bdc.ca/en/articles-tools/blog/supply-chain-disruptions-are-increasing
