With hiring in idle, bonuses rev up for drivers
As school bus drivers resume the rounds this week on Connecticut streets, some are back on the job after riding out the summer with the aid of weekly unemployment benefits.
Others have yet to return — and across the larger transportation and logistics industry, unemployment continued to inch upward in August despite some of the biggest employers in the trade in Connecticut and elsewhere dangling big bonuses to get people behind the wheels of trucks and forklifts.
That ran counter to slow but steady increases in hiring across other major employment sectors over the same span. On Saturday, expanded unemployment benefits come to an end that awarded $300 in extra weekly pay, removing one incentive for any workers choosing to stay on the sidelines.
“Post-COVID — it’s been hell,” said Norm Snyder, CEO of Norwalk-based Reed’s, which delivers it’s ginger beer, root beer and other sodas coast to coast. “The government’s paying [people] more money to stay home . ... I’ve been in this business 40 years, and I’ve never seen it this difficult.”
A catchall category for public transportation, trucking and package delivery from Amazon to the U.S. Postal Service, the transportation and logistics sector employed nearly 287,000 people in Connecticut as of mid-July.
At that point, just over 8,500 of the industry’s workers in Connecticut were filing for weekly unemployment benefits from the state Department of Labor, before a threeweek run of escalating claims according to DOL’s most recently updated count. Every other major industry tracked by DOL logged decreasing numbers of people on unemployment over that span.
While school vacations have long driven summer increases in the transportation sector’s numbers, logistics companies say they are struggling to find workers in advance of the holiday season when freight
shipments reach their peak.
The American Trucking Association cited driver shortages for a sharp drop this summer of its index tracking U.S. freight tonnage.
In June, FedEx executives said delivery drivers were pulling in ample overtime pay but still unable to meet the company’s target levels of service, and that they expected the problem would continue throughout the summer months. The company has been passing on the higher cost of hiring in the form of surcharges.
XPO Logistics, the Greenwichbased company that is among the largest in the United States, has been offering signing bonuses of $6,000 to truck drivers in pockets of the country where need has been greatest. C.R. England is offering $10,000 signing bonuses on top of annual pay of at least $65,000 to drivers willing to tackle Interstate-95 routes from New England to Florida for road trips lasting as long as 12 days.
Both companies offer commercial driver’s license schools, with XPO having trained more than 1,000 for careers at XPO as of July according to Matt Fassler, the company’s chief strategy officer.
“Net hires for the four weeks in June [were] double the number in the prior eight weeks,” Fassler said.
At Amazon, fulfillment and deliveries have doubled in the past two years, according to Brian Olsavsky, who spoke in late July on a conference call in his role as chief financial officer. Olsavsky added the company “pulled forward” to May its annual pay increases for employees that are normally awarded in October, given escalating wages for available work at other companies. Amazon is offering $1,000 signing bonuses for drivers to handle package deliveries in Connecticut.
“We’re spending a lot of money on signing and incentives, and while we have very good staffing levels, it’s not without a cost,” Olsavsky said. “It’s a very competitive labor market out there, and certainly the biggest contributor to inflationary pressures that we’re seeing in the business.”