How Would a Railroad Strike Affect the Trucking Industry?
With recent threats of railroad worker strikes, the topic of strikes in the transportation and shipping industry tends to make even the strongest economies sweat a bit. Which it should when you stop and think about the absolute necessity that rail transport alone is when it comes to any industry.
The strike
With nearly every single good and service in America relying on railroad transport to keep their company running, it would make sense to ensure the people that are doing the heavy lifting are getting at least the minimum of what they need. (Yes, the same can be said about trucking.) Not many of those outside the wheelhouse of trains understand the devastating conditions that rail workers have been under the past few years, and it’s not just due to the pandemic.
There has not been a major railroad strike since 1992 so what gives? Six years ago, dramatic budget cuts slashed the workforce by nearly 30%, leaving a hole in the industry where those who were left have had to pick up the slack. Inevitably and not surprisingly, this has led to poor working conditions for a stretched thin workforce that is increasingly feeling the effects of burn out.
When you take what was already an exhausting line of work and add a pandemic, followed by shortages, followed by economic struggles such as inflation and increased costs of living, throw in low wages (workers in the railway industry haven’t seen a raise since 2019) creates a perfect environment for a strike.
How would the strike affect truckers?
Undoubtedly the ripple effect would hit the trucking industry like a tsunami. With an already overwhelmed workforce, truckers would be expected to make up for the lack of freight movement.
A rail strike would but even more strain on an already exhausted industry.
If one were to occur in the current climate that the transport world is in, there would be little truckers and carriers would be able to do to remedy the hole that rail would leave. With resources and equipment still being riddling with production issues, many trucking companies have had to find independent contractors to fill the demand. The everlasting trucker shortage is still as bad as it’s ever been, thus putting the weight of more freight on them impossible.
Realistically, there would be more work available to truckers which some may welcome but as a country we are not even close to having the capacity that would be demanded from a rail strike.
“Idling all 7,000 long-distance daily freight trains in the U.S. would require more than 460,000 additional long-haul trucks every day, American Trucking Association President and CEO Chris Spear wrote in a letter to Congress earlier this month.” – newsnationnow.com
Companies are already calling upon carriers to handle their capacity in light of the impending strikes.
“’As of yesterday, we only had one call looking for extra capacity. Now just this morning, we’ve had a little more than 10,’ Greg Orr, executive vice president of truckload for CFI, a unit of Heartland Express, the nation’s eighth-largest TL carrier. ‘So, there’s a little more activity today.’
Orr said his company, like many in the $332 billion truckload market, was willing to entertain some potential new customers. But he said there simply is not enough excess capacity to handle all the freight a national freight rail shutdown would produce.” – logisticsmgmt.com
Action items
Though a temporary deal has been made to ward off an immediate strike until the end of September, many believe that one will happen eventually unless dramatic improvements are made to the day-to-day working conditions and structure that rail workers endure.
From APnews.com – “Members of one union rejected a tentative deal with the largest U.S. freight railroads Wednesday, while two ratified agreements and three others remained at the bargaining table just days ahead of a strike deadline, threatening to intensify snarls in the nation’s supply chain that have contributed to rising prices.
About 4,900 members of the International Association of Machinists and Aerospace Workers District 19 voted to reject the tentative agreement negotiated by IAM leadership with the railroads, the union said Wednesday. But the IAM agreed to delay any strike by its members until Sept. 29 to allow more time for negotiations and to allow other unions to vote.”
Whatever the outcome in the coming months will be, we believe Todd Spencer said it best:
“I understand that transportation workers — whether they be railroad or truckers — they are essential, and if we want our supply chain to work, if we want to meet the needs of America, and others, then we need reliable people and we need to recognize the value that those people bring.”
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