University of Tennessee’s Hours of Service (HOS) Study
The UT study surveyed 417 companies and found that 58 percent of them expected an increase in their carrier rates. They anticipated passing on the costs to their customers in the long term.
Recalling the survey results which indicated that long haul moves have been the most impacted, we expected that many firms would seek to move freight volume to intermodal.
This is clearly not going to be the case as some 70.1 percent of companies indicated that they will not shift freight to intermodal.
In summary, we believe that the loss of transportation productivity will result in a need to hire more drivers to accomplish the same amount of work.
The industry is already experiencing hiring pressure due to an aging driver workforce and the impact of the Compliance, Safety and Accountability regulation of 2010.
Taken together, the effect of the regulation will be an increased shortage of drivers available to transport shipments in 2014 and beyond.
This shortage will cause higher driver turnover rates, which will ultimately lead to higher costs for both carriers and shippers. The results of this study suggest that indeed will happen.
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