UK haulage crisis: extra charges to retain drivers add to cost of moving goods

Fri 27 Aug 2021
Posted by: Noelle McElhatton
Trade News

Hauliers are adding “driver retention surcharges” of up to £65 per load to customer bills to boost driver wages and prevent them moving to more highly paid positions.

The move is increasingly widespread as haulage firms seek to stem the flow of drivers moving elsewhere as the sector faces a shortfall of up to 100,000 drivers.

‘No alternative’

Speaking to the Loadstar, one haulier said that the move came despite a 20% increase in wages to his drivers, saying that that only alternative was hiring agency staff who cost 50% more.

Some drivers have seen their pay rates quadruple, it claims, with smaller companies unable to match the deep pockets of retailers and companies offering lucrative, but temporary incentives. 

One forwarder said: “With Christmas fast approaching and November/December being historically bad with availability and a need to pre-book slots with hauliers due to high container volumes arriving for Christmas, just how much worse will this get?”

According to the Telegraph, lorry driver wages are up by a tenth in the past five months. 

Pilot turned trucker

The Daily Mail profiled a Flybe pilot who, having lost his job during lockdown when Flybe collapsed, has gone back to being a lorry driver.

Aaron Leventhal, 37, gained his HGV licence driving trucks in the British Army and then spent 10 years becoming a jet pilot. After Flybe collapsed, Leventhal became a freelance driver delivering essential food and fuel to supermarkets.

The Daily Mail reports that with driver shortages, freelance truckers can now earn £40,000 a year.

Food prices to rise

Shortages and supply chain issues continue to bedevil the UK with ONS figures revealing more than a quarter of food and hospitality businesses impacted by stock shortages and shoppers warned to expect higher prices, the Independent reports

Road Haulage Association managing director Rod McKenzie said hauliers would have to pass on “substantial” driver pay rises to customers such as supermarkets who would pass it on to their customers.

“In turn, this may mean more of us paying higher prices for goods, services and shopping – including food prices – going forward,” he added. 

Blood tests on hold

Health services are also being hit by a shortage of test tubes that could constrain blood tests reports the BBC. Doctors are being told to stagger tests until the situation eases, hopefully next month.

In the meantime, the NHS has temporarily stopped some blood testing for fertility, pre-diabetes, allergies and certain blood disorders.

Pig surplus

At the same time, pig producers could have to cull 70,000 animals due to backlogs in processing. Surplus pigs cost to keep feeding and penalties are charged by processors for overweight animals, explains the FT

Zoe Davies, chief executive of the National Pig Association, said the situation compounded the problems the industry faced following Brexit-related problems at the start of the year. It was left with 100,000 surplus pigs, leaving many farmers operating at a loss.

“It’s devastating to a lot of farmers who had only just sorted themselves out from the last time,” she said. “We are expecting quite a big exodus from the pig sector next year.”

Despite the surplus of animals, the UK may have to resort to exporting pork products to fill gaps in supply that home producers can’t fill, warned Nick Allen, chief executive of the British Meat Processors Association.