Perks include a $1,500 hiring bonus and overtime pay. Federal limits on daily working hours, the COVID-19 pandemic and other hurdles prompted many truck drivers to quit.Īt Seven Strong, new drivers start at $22 an hour. Truckers' pay has not kept pace with inflation, leaving "real" earnings at 70% of what they were in the 1970s, according to the U.S. Amazon expects those costs to double for the current holiday quarter, threatening to erase profit in its biggest selling period. Seattle-based Amazon in October said that higher wages, more worker incentives and inflation in services such as trucking contributed to $2 billion in extra expenses in the prior quarter. Skilled drivers can hop to a new job with better compensation amid record demand for consumer goods. Labor woes are particularly acute for big-rig trucking firms because their drivers need more credentials: Government agencies require them to have commercial drivers' licenses, and insurers increasingly demand two years' experience. "Everybody's feeling the heat," she said. Filling seats in those vehicles falls largely to independent contractors like McKinley at a time when the industry has a record shortfall of 80,000 big-rig drivers. It now has 20 Amazon-branded semi-truck tractors as part of AFP and employs 45 drivers.Īmazon's logistics unit has bought 1,395 Amazon-branded big-rig tractors to pull trailers of goods in the United States, according to Department of Transportation data seen by Reuters. The Phoenix-area firm was among the first to join the AFP program in April 2020. "There's a shortage of drivers, especially the good drivers," said Ebony McKinley, owner of family-run Seven Strong Trucking.
This trucking network - separate from the army of home-delivery contractors that drop Amazon packages on shoppers' doorsteps - puts small AFPs in fierce competition for drivers against Walmart Inc (WMT.N) and United Parcel Service Inc (UPS.N). Since 2019, Amazon has recruited 250 AFPs around the globe, and made it possible for the companies "to start and scale their own transportation businesses and create job opportunities for thousands of drivers," an Amazon spokeswoman said. The companies, or AFPs, all of which are exclusive Amazon contractors, also move packages to and from the company's fleet of 85 owned or leased North American airplanes. Its project, called Amazon Freight Partners (AFP), enlists independent trucking companies to move goods between Amazon facilities. LOS ANGELES/CHICAGO, Dec 8 (Reuters) - Inc's (AMZN.O) push to recruit big-rig contractors to haul goods across its web of warehouses is colliding with a trucker shortage as the e-commerce company moves what are expected to be record numbers of packages this holiday season.
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