More than three quarters of trucking companies laid off employees – mostly truck drivers – since the COVID-19 pandemic shocked the economy, according to a new report by Trucking HR Canada.
The report, conducted by the Conference Board of Canada on behalf of THRC, provides insight into how COVID-19 is affecting trucking and logistics employment, measures which have been implemented throughout the industry and the expected impacts on key fleet human resource activities over the next three to six months.
Three out of four (76%) employees surveyed stated they laid off workers due to COVID-19, with more likely on the way. Truck drivers accounted for over 70% of the layoffs. Over a third of employers (36%) expect to lay off additional workers over the next three to six months due to the economic fallout of COVID- 19.
Other key findings include:
- The combination of layoffs and employee-initiated departures reduced total truck driver employment in the survey sample by 11.4%, from 17,100 workers pre-COVID to 15,200 by late May. Besides laying off workers, three in five employers (60%) reduced working hours while 23% have frozen salaries or wages for truck drivers still on the payroll;
- Ensuring adequate health and safety measures for workers, particularly truck drivers, is a continuing challenge for fleets. Looking forward, employers expect to face difficulties training and onboarding truck drivers in a COVID-mitigation environment.
- Truck driver employees were more impacted by COVID-19 than owner-operators;
- Companies transporting goods for the manufacturing sector reported the steepest employment decline, with 17% of their workers laid off;
- Dispatchers and mechanics were also noticeably impacted by layoffs with a respective 10% of employees laid off in each occupation.
“Since mid-March, the global COVID-19 crisis has put a halt to the Canadian economy. Amidst an economic shutdown, trucking and logistics has emerged as an essential service, and employees and employers alike have been heralded as heroes. Yet still – many employers have had to layoff drivers and other employees while not qualifying for the huge government relief programs available,” Trucking HR Canada stated in a news release.
The news confirms the immediate need to expand labour support programs to involve more trucking companies, says the Canadian Trucking Alliance, which has been urging the Prime Minister and several high-ranking cabinet ministers to consider targeted relief measures to support the trucking industry, such as amending the Canada Emergency Wage Subsidy (CEWS) to be more inclusive of struggling trucking and logistics businesses.
“The trucking industry has received extraordinary support during the COVID-19 crisis, but it also faces unique and rapidly escalating challenges which require tailored solutions to protect the stability of the supply chain as we eventually move towards an economic recovery period,” said Jonathan Blackham, CTA’s director of Policy & Public Affairs.
CTA has conducted extensive economic modelling and determined that about 50 percent of trucking companies do not qualify for the CEWS either fully, or in part. In fact, many fleets are falling just below the threshold of ‘30-percent’ decrease in revenue required to receive up to 75 percent in wage subsidies for eligible employees. Consequently, there are very few scenarios in which most trucking companies will not be forced to operate on a negative cashflow basis through the pandemic and beyond, including companies that are currently able to access the CEWS at the full benefit, CTA says.
“While CTA understands that government has difficult decisions to make and likely cannot satisfy all employers in every sector, we do believe that stabilizing the Canadian transportation industry and supply chain – the backbone of the economy – needs to continue as a priority,” says Blackham.
The THRC report shows that while many carriers have been forced to idle trucks and drivers and freeze wages as the freight market rapidly dried up during COVID, several carriers are doing what they can to reward working drivers in other ways.
One in five employers are provided their truck drivers with non-monetary rewards/incentives such as flextime, childcare, and time off.
“As we work to support employers in responding and rebounding from COVID-19, this labour market intelligence will inform relevant approaches,” says Angela Splinter, CEO of Trucking HR Canada.
Read the full report here.