Walmart truckers earn as much as some bankers

Bloomberg Opinion Walmart said it will pay its entry-level truckers $95,000 to $110,000 a year, which is 26% higher than what it previously paid and approximately even with what a junior banker on Wall Street might make even with their advanced degrees from an Ivy League institution. This is sure to upset junior bankers, who are probably putting in a lot more time in the office than truckers are on the road but may not provide as much benefit to society.

The compensation offered by the Bentonville, Arkansas-based retailer exposes just how uneven the labor shortage is these days. There is a dearth of truckers, painters, roofers, plumbers and others to fill blue collar jobs. Almost half of manufacturing executives are turning down business opportunities due to a lack of workers, according to a report last month from Deloitte and The Manufacturing Institute. Although it may be true that banking is more highly skilled labor than trucking, there is abundance of bankers and you can’t fool the laws of supply and demand. A few months ago, I heard of painters making $45 an hour in New Jersey, which comes out to about $90,000 a year. Doesn’t sound like such a bad deal.

One thing I was saying last year as the economy was reopening and businesses struggled to find workers was that if wages went high enough, people would get off their couches and go back to work. That seems to be happening. The labor force participation rate is just a couple of months away on its current trajectory from where it was in the years before the pandemic. And wages are rising as the number of job openings exceeds the pool of available labor by a record amount. So, it seems likely that the unemployment rate will fall even further, possibly to about 2% from the 3.6% in March. That would surprise a lot of people.

For years, right-wing pundits have been doing the Mike Rowe thing and telling people that blue collar jobs are dignified labor, and that maybe you’re better off trucking than you are going to college and running up a lot of student loan debt. That turned out to be somewhat true. (Maryland Gov. Larry Hogan just announced that thousands of Maryland state government jobs no longer will require a four-year college degree.)

There was a scene in the Wall Street movie The Big Short where Mark Baum, a character based on a real life fund manager, has dinner with a collateralized debt manager who brags about all the money he is making and says that the market is assigning a higher value to his labor. That turned out to be transitory. But the economic fundamentals behind the current bump in compensation for blue collar workers is probably not transitory, at least over the next couple of years. The U.S. Chamber of Commerce estimates that if every unemployed person in manufacturing became employed, the industry would only fill 65% of the vacant jobs. The U.S. has a shortage of 80,000 truck drivers, according to Bloomberg News, citing the American Trucking Associations.

And I don’t think the recent wage gains are transitory. The labor shortage is still very acute and is not going away anytime soon. So, for the time being, the market is assigning an almost equal value to trucking labor as it is to banking labor. I know a trucker, and I don’t get the impression that it’s unpleasant work. Sure, there are the licensing requirements and there’s a great deal of regulation, and the industry has practically zero tolerance for safety violations. But a life on the road appeals to many people. And although the Silicon Valley geeks want to put truckers out of business with autonomous vehicles, that seems unlikely to happen in the next 20 years.

For years the elite have looked down the end of their noses at blue-collar work, calling them dead-end jobs or worse. I don’t think it’s unreasonable for a trucker to make a six-figure salary. The supply-chain disruptions that came with the pandemic showed that it’s an essential job. Who, exactly, is adding more value? The trucker delivering goods that everyone needs or the banker manipulating spreadsheets and proofreading pitch decks? Maybe we should think twice about what a good job really is. Working with your hands wasn’t a bad deal before, and it’s a great deal now.