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Canada and US trucking Industry in 2022
- Jan 05, 2022
Currently, the Canadian trucking industry is one of the strongest in the world. Its GDP is $648 billion. More than 120,000 Canadian and US licensed truckers operate cross-border trade, and there are about 40,000 U.S.-licensed drivers operating north-south trade. According to Trucking HR, Canada currently faces a shortage of 18,000 truckers. The United Kingdom, on the other hand, has a shortage of up to 100,000 "lorry" drivers to meet increasing consumer demand.
While many organizations and companies are opposing President Joe Biden's recent mandatory vaccinations, the government is moving forward with the policy despite concerns from many trucking and logistics operators. The mandate would affect companies with 100 or more employees, but Canadian drivers would still need to get the required vaccinations. The CTA has asked for a delay to the deadline to allow truck drivers to be exempted.
However, this new legislation will have an immediate and negative impact on the Canadian trucking industry. While many of these companies grew organically last year, the heightened safety standards that accompany COVID-19 may not be enough to support the growth of their businesses. The shortage of truck drivers will force the industry to rethink their business models and implement new measures. These initiatives will help them attract drivers and improve working conditions. Fleet operators will also increase wages and provide enhanced benefits for drivers. Moreover, they will implement telematics to monitor their drivers and conduct mock audits. These measures will be implemented by companies that have a need to improve their driver training and skills.
Despite the challenges of the trucking industry, the future looks bright for both countries. The American Trucking Association's Chief Economist Bob Costello has predicted that demand for freight will remain high through 2022. According to the organization, it is estimated that 10 to 20 percent of U.S. drivers and 40 percent of Canadian truck drivers will be displaced if the new requirements are implemented. The new rules will likely save several companies from bankruptcy.
According to the CTA, there will be more than 600,000 employees in the Canadian trucking and logistics industry in 2022. This number includes about half a million Canadian drivers and fifty thousand U.S. drivers. The two nations are projected to trade more than $11 billion in goods annually, which will increase by 12% over the next five years. The supply chain is the most crucial component of a country's economy.
There is no question that the trucking industry plays a vital role in the transportation industry. Infrastructure investments and new technologies will have a significant impact on the industry's future. And the sector's labour force participation rate is still very low. The number of Canadians in the workforce is lower than that of the United States. This means that many companies will face the need to make acquisitions to grow their business.
The current mandates for trucking do not meet the needs of the industry. The market is not ready for the mandates as scheduled. Regardless of the current deadline, the trucking industry will continue to grow in Canada and the US in 2022. But the Canadian and US trucking industries have to work together to ensure that their supply chains can be as efficient as possible. Without a doubt, the industry will continue to thrive, but there is no guarantee that it will continue to be as competitive as it is today.
In Canada, the supply chain is a complicated and highly-integrated system. As a result, the mandates are an issue of mutual concern. As a result, they will have a significant impact on the trucking industry. For example, the Canadian government is planning to impose a mandatory vaccination for cross-border trucks by 2022. While this may seem like a good idea, the U.S. government has not yet made a final decision.
Moreover, the mandates are not effective in the supply chain. A Canadian government mandate will affect approximately ten to twenty percent of Canadian truck drivers. The US government's mandate will affect nearly forty percent of U.S. truck drivers. It is vital for Canada and the United States to keep this rule in check to ensure smoother trade between the two countries. In Canada, 70% of the goods traded between the two countries will be transported by truck, and the U.S. will require up to 40,000 licensed drivers.