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Could The Trucking Shortage Be Raising The Price Of Groceries?

 

Prices on consumer goods are on the rise for a variety of reasons. From new tariffs against China upping prices on technology, tires and other imported items, to inflation, there are many reasons we may be seeing higher prices on the things we buy every day. But could the trucking shortage also be a contributing factor? Especially when it comes to the rising prices of groceries, there is reason to believe the deficit of truckers could be directly related.

Grocery Prices on the Rise

According to the U.S. Department of Agriculture, food prices will increase by 1-2 percent in 2019. This was a common trend for many decades; however, the rise of food prices has slowed over the past few years. Now, these prices are back on the rise, with notably higher prices on groceries of all kinds.

The price of dairy products is projected to increase by 3-4 percent, vegetable costs will rise 2.5-3.5 percent, and both bakery and fruit prices will increase by 2-3 percent. As for meat, all costs are expected to rise by from 1-3 percent, with the exception of pork, which could actually drop in price by .75 percent.

What is Causing this Raise in Prices?

The rise is grocery prices could be due to a number of factors. From oil prices to overseas trade, a variety of things can spark a cost increase at the grocery store.

High Oil Prices

Oil prices can affect grocery store prices in two different ways. High oil prices often lead to increased shipping costs, which results in higher grocery prices. Because of the higher oil prices, food that gets transported across long distances costs more to ship, so grocery stores have to charge their customers more. Oil prices are constantly in flux and are influenced by several complex factors of their own.

Oil can also affect farming, which can make groceries more expensive as a result. Oil byproducts are an important part of fertilizers, and their price accounts for 20 percent of the cost of growing grains.

Climate Change

Climate change can cause extreme weather conditions that harm crops or make them much more difficult to grow. Because of greenhouse gas emissions, the hot air can absorb moisture and cause it to rain less, drying up ponds and lakes. Additionally, when it does finally rain, the water runs off the land and doesn’t get absorbed by the crops.  These factors force farmers to invest more money into yielding a smaller number of crops and selling them to market at a higher price.

U.S. Government Subsidies

Because it is used to create ethanol, a large percentage of the U.S.’s corn production is subsidized. Currently, 40 percent of corn crops go to producing ethanol, which is a huge increase from 2000’s six percent. This means less corn is going to the food supply each year, causing the prices at the grocery store to rise.

World Trade Organization

The World Trade Organization also has a say in the world’s corn and wheat stockpiles. Because many developed countries like the U.S. and countries in the EU subsidize their agricultural production, they have an advantage over poorer, developing countries. To compensate, the World Trade Organization limits the amount of stockpiling a country may do. However, this means that in a shortage, prices of corn or wheat could rise dramatically in the U.S.

How Does the Truck Driver Shortage Contribute?

In recent announcements, brands including Mondelez, Hershey, Nestle, Unilever, and Coca-Cola stated they will need to increase prices in 2019. These price hikes are in reference to two factors: Higher ingredient costs and increased freight expenses.

A detailed analysis revealed that the cost of a refrigerated truck moving from Washington State to New York rose by 18 percent in only a few weeks. So, a shipment that costed $8,450 jumped to $10,000 a few weeks later. In addition, a truckload heading east out of California saw prices rise by 25 percent during the same time period.

So, what does this have to do with the trucking shortage? Because there are less truckers on the road, the demand for qualified drivers is boosting prices across the board. The cost to transport food across the country has risen, and those higher prices are reflected in markets and grocery stores as well.

American Trucking Associations says the industry is lacking at least 50,000 drivers. If the trucking shortage continues on its current path, that number will be at 174,000 by 2026. And in a decade, it could take 890,000 new drivers to adequately close the gap. Now more than ever, trucking companies are on the lookout for new, qualified drivers to help keep grocery prices low and the economy healthy.

Staying Healthy On The Road

 

Choosing healthy snacks on the road can be a tedious task. From over-processed snacks at truck stops to greasy fast food, finding a healthy snack that also tastes good may seem impossible. However, eating healthy on the road is imperative to living a long, happy life as a commercial truck driver, and it is not at challenging as it may seem. Here are some great, healthy options for snacks on the go.

Raw Vegetables

You may not find a surplus of raw, crunchy vegetables at your usual truck stops. However, you can count on any grocery store along your route to have a variety of vegetables for you to snack on. Easy, on-the-go vegetables include baby carrots, celery sticks or broccoli. If those aren’t your favorites, don’t worry. There are plenty of other nutritious options out there.

Hummus

If raw veggies on their own isn’t your thing, try dipping them in some hummus. Hummus is a great source of protein, fiber and antioxidants, and with yummy flavors like chipotle and roasted garlic, hummus is the perfect way to liven up your snack. Try hummus with carrots, sliced bell peppers, or even some pita chips for a healthy snack.

Fruits

Fruits are another excellent snack for the road. They are packed with important antioxidants and vitamins, and they can give you the boost you need to get through a long drive. Many grocery stores and even truck stops offer pre-cut and washed fruit cups for easy snacks on the go, and just about every gas station has bananas and apples on hand. Just be careful not to purchase fruit cups packed in sugar syrup. Fruit is plenty sweet on its own without the added sugar and extra calories to weigh you down. Try snacking on a fresh apple to give yourself a boost of energy or have some watermelon to stay hydrated on the road.

Beef Jerky

Jerky can be a satisfying and tasty snack on the road when you are craving something savory and are limited to a truck stop. However, be sure to choose a healthy jerky that is low in sodium and sugar. A good rule of thumb is to choose jerky with less than 500g of sodium and 5g of added sugar per serving. Even if you are a little on the picky side, you should still have plenty of jerky to choose from.

Boiled Eggs

Boiled eggs are a great snack for the road because they are high in protein, filling, and easy to eat; just be sure to keep them cool while traveling. Peel your boiled eggs ahead of time and keep them in a cooler on the road. If boiled eggs are a little bland, liven them up by adding hummus or avocados.

Protein Drinks

When you just want a healthy, filling, and easy option to store in the truck at all times, there is nothing wrong with stocking up on protein shakes. You can buy protein shakes in powder form to simply mix with water, or you can buy the shakes pre-bottled for easy access. Protein drinks can also provide you with many essential proteins, vitamins, and minerals that will keep you healthy on the road and may otherwise be difficult to get.

Snack Bars

Snack bars can either be a great, healthy snack or a secret source of sugar and fat. If you choose the right bar, they can be a great source of protein, keep you full between meals, and maybe even satisfy your sweet tooth with honey and berries. However, there are some bars on the market that might as well be candy bars with all of the sugar and fat they have packed in. Be sure to choose bars that are high in protein and nutrients and low in sugar and fat.

Water Bottles

This may not be a snack or even a food but drinking plenty of water can be a great way to stay healthy, energized and full. It may be tempting to avoid water while driving long distances because it will cause more frequent bathroom stops. However, allowing your body to become dehydrated by limiting water all day will cause you to become drowsy and fatigued. Being dehydrated can even cause you to start craving sweets and junk food. Instead, be sure to drink plenty of water throughout the day and snack on fruits that are high in water content. This will keep you hydrated and keep your sugar cravings in check.

Healthy Habits for Truck Drivers

Staying healthy and energized on the road can be a challenge, but you should take the time to pack nutritious snacks and meals before you head out on your next trip. In addition to eating better, try implementing exercises and stretches into your driving routine as well. Start making your health a priority, and you will feel happier, have more energy, and enjoy a better quality of life every day.

 

If you’re considering a career as a commercial truck driver and need help with a loan, contact Mission Financial today. We offer first time buyer loans for drivers with low credit scores.

Why More Millennials Should Become Truck Drivers

 

Millennials are now the largest demographic segment of the workforce. This generation, which consists of those born from 1981-1996, is primarily defined as the first generation to grow up with access to modern technology, particularly the internet. This, along with other factors, has caused them to have different requirements, expectations and desires as they search for jobs. And with booming industries like tech and engineering tempting millennials with large salaries and room for growth, many have never considered a career in commercial truck driving.

 

However, with the trucking shortage leaving many driving jobs unfilled each year, companies are willing to make truck driving worth a job hunter’s time. Here are a few reasons why millennials should consider becoming truck drivers.

 

Stereotypes are Changing

 

The truck driving industry has a lingering reputation of only being suitable for brawny men with long beards who practically live in their trucks. However, this stereotype is long overdue for a makeover. The days of heavy lifting and hard to maneuver big-rigs are in the past. You don’t need extra muscle to be a truck driver, which is one reason why trucking is now a career enjoyed by women all over the country. Trucks now have more luxurious cabs with power steering, state-of-the-art technology, and everything from hood releases to dollies are now hydraulic. Everything works with the push of a button, which means the world of trucking is more accessible than ever before.

 

Because more and more women are becoming truck drivers, new safety priorities are being established, which are changing the way trucks are designed and the trucking culture as a whole. Trucks can now come with their own private bathroom units and security systems, and truck stops are no longer exclusively full of male truckers.

 

The Trucking Demand Means Competitive Wages 

 

According to Jon Gilbert of PLG Consulting, “The average age of commercial truck drivers is 55 and rising rapidly. The concern is that older, qualified truck drivers are retiring, and we are not getting adequate replacement drivers.”

 

As the age of truckers rises, more and more trucking jobs are becoming available. This increased need for truckers is only making starting salaries increase as well. In 2017, the average starting wage for a trucker was around $40,000 per year. Truckers are also typically offered excellent benefits including 401Ks and healthcare. And while $40,000 may be the starting salary, there is plenty of growth in the industry. Some truckers even make upwards of $80,000 based on experience and mileage.

 

Advancements in Autonomous Vehicles

 

While many people have feared that autonomous vehicles may cause truckers to lose their jobs, the opposite is actually the case. In fact, advancement in AI in the trucking industry would only make truckers’ lives easier by solving any problems they may currently be facing.

 

Autonomous vehicles will still require drivers to be alert and present in the vehicle at all times. However, with advancements such as platooning, which links trucks together via WIFI to reduce fuel consumption and accidents, drivers would not have to be as active in controlling the vehicle. This would allow drivers to not become mentally exhausted after long hours behind the wheel, and most importantly, it would mean their jobs were safer.

 

Truck Driving Requires Minimal Requirements

 

Unlike most jobs that have starting salaries around $40,000, commercial truck driving does not require an expensive college degree. To become a trucker, one only needs to complete an accredited training course. These trucking schools typically cost between $3,000 and $7,000, which is far less than a four year degree. Additionally, it does not take long to become a qualified driver. The average school will only take seven weeks to complete, meaning a new trucker can be out on the road within a few months of making a career change.

 

Possible Roadblocks

 

One concern the trucking industry faces when it tries to recruit young people right out of high school is current law against interstate travel. Currently, truckers must be at least 21 years old to travel over state lines. This means that people hoping to become truckers out of high school must only drive within their state for a few years before getting to take the higher paying, cross country trips.

 

However, lawmakers have recently started taking steps to reduce the interstate age to 18. This change is a direct response to the shortage of truckers. If this new law passes, many trucking companies, restaurants, and retailers believe it would put more truckers on the road and increase the efficiency of goods being delivered across the country.

 

Now is a great time to start a career in trucking. If you are considering becoming a commercial truck driver but need a first-time buyer loan, contact Mission Financial today.  

Could New Tariffs Against China Halt U.S. Trucking Demands?

 

Throughout 2018, the heated trade war between the U.S. and China has been full of twists and turns. The changes in taxes is an effort to boost the American economy by encouraging less outsourcing and bringing more manufacturing to the U.S. However, some new policies put into place earlier this year have caused difficulty for multiple industries. But what does this all mean for the trucking industry? Could the new tariffs mean less trade and an end to the demand for truckers across the U.S.? Here is what you need to know regarding the new tariffs against China.

Trade War with China

The trade war between China and the U.S. has been a roller coaster, especially throughout 2018. Not only has the U.S been levying tariffs on over $250 billion of imported goods out of China, but China is fighting back with $110 billion on the U.S.

Now, as 2018 comes to a close, the nation awaits the $267 billion in tariffs against China taking effect on Jan. 1. This round of tariffs is expected to hit far closer to home, as businesses of all sizes and industries, as well as consumers, feel a direct effect. Prices on consumer goods including tires, furniture and especially technology are expected to be the first to rise dramatically.

An Argument for Tariffs

Over time, those in favor of the tariffs are hoping the new taxes will boost the American economy. Because of the new tariffs, businesses will be able to charge higher prices for consumer goods. Additionally, domestic producers will profit more by investing in factories on U.S. soil. In theory, this will create millions of new jobs in the U.S. and improve the economy exponentially.

However, the higher taxes mean higher prices for the American people as well as businesses big and small. This could potentially cause the U.S. economy more harm than good, as business struggle to stay afloat while adjusting to the new costs.

New Tariffs Already Affecting the Automotive Industry

The industry in the U.S. already feeling the effects of tariffs includes the automotive industry, which is having to dig deep to afford the new taxes on vital materials like steel and aluminum. In fact, because of the rise of cost in imported goods, some American-based factories are considering taking their business overseas to avoid the taxes.

This is the case for Harley-Davidson. Their chief financial officer, John Olin, projected the new tariffs would cost them an extra $40 million in 2018, due to the increased cost to import materials. This economic hit has left the motorcycle company to consider moving production out of the U.S. entirely.

New Tariffs Could Directly Affect Consumers 

While most other tax changes have not directly affected American consumers, these new tariffs against China could result in price increases on things people purchase every day. From canned goods to technology, large retailers like Target and Walmart have expressed concern about being forced to raise prices on their imported products.

In September, the director of global government affairs for Walmart wrote a letter to U.S. Trade Representative Robert Lighthizer discussing the impact the new tariffs could have on the American people. The message listed everything from clothing to dog leashes that would see a raised price after the new tax took effect. However, the letter stated that the worrisome increases could be on electronics, cosmetics and products for children. Walmart’s representative said she feared, “Increased costs associated with new tariffs could lead families to turn to cheaper, but less safe options to offset new financial burdens.” 

What it Could Mean for Truckers

So, what does this mean for truckers across America? If less goods are entering the country and Americans are buying less due to price increase, it seems that truckers could also see a decline in job security. However, while these new tariffs could mean a lot of adjustments for businesses big and small, the chief economist for Freightwaves, Ibrahiim Bayaan, believes the demand for truckers will continue to increase.

He projects that these new tariffs will inspire businesses across the country to stock up on goods before the new tax comes into play. This would mean, in the short term, even more work for truckers as the surplus of goods flow in. Bayaan states that this extra backup of goods will give businesses time to come up with a plan to stay ahead of the tariffs and not allow it to affect their business or their prices for long.

This means that business will remain consistent and even increase for truckers. As more factories and manufacturers become a part of the U.S. economy, the transportation of goods will only grow in demand. Into the foreseeable future, despite any tariffs or AI advancements, there will still be a large need for commercial truck drivers all around the country.

 

Do you need help with your commercial vehicle loan? Contact Mission Financial for all of your financing needs.  

The Importance Of Trucking During The Holiday Season

 

This holiday season is off to a record-breaking start; from Black Friday, to Cyber Monday and beyond, sales have skyrocketed in store and online. In fact, a record-breaking $6.22 billion was reported from online sales alone this Black Friday, which is a 24 percent increase from last year. And not only are there more sales this year, but the average order value has increased to $146, an 8.5 percent increase from 2017. Cyber Monday also had its most-ever sales at $7.9 billion, a 19.4 percent increase from last year’s $6.6 billion.

According to the National Retail Federation (NRF), November and December make up nearly 20 percent of annual retail sales, and this number is only expected to rise. These increased sales mean big things for the U.S. economy and businesses everywhere. They also force consumers to reflect on how important truck drivers and the freight industry are during the holiday season.

Communities Rely on the Trucking Industry

Studies show that 80 percent of communities across the U.S. receive all of their goods by truck. That means that without truck drivers, the large majority of the U.S. would not have access to food, clothes or supplies all year-round. This becomes even more prevalent during the holiday season, as families around the country rely on truckers to deliver the food, decorations, and gifts to help fulfill their family traditions.

Without truck drivers, packages would not arrive at people’s homes in time for Christmas or other days of celebration, office shelves and storage closets would remain empty year-round, and retail establishments would have no products to sell. Especially in areas that have no alternative means of delivery, businesses rely on weekly or monthly shipments from reliable truck drivers in order to make a profit throughout the season.

Truckers Help Keep Holiday Roads Safe

During Thanksgiving alone, an estimated 54.3 million Americans traveled at least 50 miles away from their homes; a 4.8 percent increase from last year. As more and more people start traveling for the holidays, the risk of accidents also increases. However, each year, truckers are doing their part to keep the roads as safe as possible through extensive training, innovative technology and safety communication campaigns. In fact, the American Trucking Association invests over $9 billion annually into these facets. This is to ensure truckers are well-trained and given the best, most up-to-date vehicles possible, so that everyone can arrive safely during the holidays and year-round.

Rise of Online Shopping and the Freight Industry  

Because of the rise in Amazon’s frictionless shopping experiences, low prices, and same-day / two-day deliveries, consumers now have heightened expectations when it comes to shopping. People want a personalized experience, the lowest price, and as little social interaction as possible. Most importantly, they want their merchandise immediately. This phenomenon called “The Amazon Effect,” has left traditional online and retail stores to alter their business models to keep up. However, for many businesses across America, competing with Amazon will be impossible. In fact, industry analysts project that 20 percent of retail stores will be permanently closing their doors in the next 5-7 years.

For the businesses that wish to stay afloat, fast shipping is a must. This has inspired solo truckers to pair up, so they can alternate shifts and keep the truck moving all day and night. One trucker will sleep while the other drives, usually switching every 10 hours. Fast shipping is especially important during the holidays because the percentage of online shoppers increases dramatically during this time. Last year, for example, there was a 16.9 percent increase in online shopping during the fourth quarter. Truck drivers have to work tirelessly to make sure every gift, package and holiday parcel arrives at its destination on time.

The Demand for Truckers is Increasing

As time goes by, despite concerns about new AI,  the need for truck drivers is only going to increase. According to the American Trucking Association’s “U.S. Freight Forecast to 2024,” there will need to be a 20 percent increase in freight volumes of all kinds to keep up with demand by 2024. This report, originally published in 2013, has proven prophetic in the increase we have already seen within the trucking industry, and the numbers are only getting higher. Additionally, due to the new tariffs rolling out against overseas trade,  U.S. trucker demand will skyrocket again as more and more goods are manufactured and distributed in the U.S.

 

Tis the season to be grateful for truckers everywhere, and if you are considering becoming a commercial truck driver yourself, there is no better time to get started. Jumpstart the process and get yourself behind the wheel of a big rig as soon as possible and leave your financing needs in the capable hands of Mission Financial.

What Truckers Need to Know About Autonomous Vehicles

 

This century’s boom in technology has revolutionized seemingly all aspects of everyday life. It has gone well beyond our computers and cell phones. Now, our vacuum cleaners, thermostats, and even our dog’s collars can be connected to the internet to make our lives easier and more automated. However, nothing seems to be gaining more excitement than the automation of vehicles. Technological advancements are reducing accidents and making driving safer, more comfortable and convenient.

But if you are a truck driver, the automation of vehicles may seem like a cause for concern. You may be worried what the rise of self-driving trucks could mean for your industry, or more specifically, your job. Recently, Goldman Sachs released the prediction, “as autonomous vehicle technology peaks, as many as 25,000 trucker jobs could be eliminated per month or about 300,000 annually.”

This sounds like a concerning prediction at first, but upon a closer look, this statement is quite vague. We are decades away from any peak in autonomous vehicle technology. In fact, vehicle automation has just begun. For now, the primary focus of automation in the trucking industry comes in the form of “platooning,” which should put all drivers at ease once they learn about it.

Platooning

Platooning is legal, digital tailgating among trucks that will decrease accidents and reduce fuel consumption among trucks. It works by linking trucks to one another using short-range wireless connections. This allows the trucks to drive closely to one another to utilize an aerodynamic benefit. The wireless connection comes into play by allowing the trailing trucks to automatically brake when the front truck slows down, as to avoid rear-end collisions.

This technology will be invaluable to fleets. Platooning has the potential to reduce fuel consumption by 5-20 percent. Additionally, the automation comes with safety technology that will help truckers stay safe on the road, including lane-keep assist, adaptive cruise control, and air brakes. As a bonus, platooning technology would not even require fleets to purchase new trucks or costly equipment. As a recent panel discussion, Michael Roeth, executive director of the North American Council for Freight Efficiency (NACFE), discussed how everything you would need for platooning is already in most trucks.

“Safety equipment like automatic braking and lane keeping are options fleets can buy on their trucks, and they are being bought on a pretty high scale with no regulations requiring them. A lot of the technology that is required to platoon two trucks is already on the truck. Now we just have to figure out how to handle the vehicle-to-vehicle communication.”

Trials of platooning are happening now across the world with hopes of commercial operations beginning as soon as 2019 in the U.S. However, more realistically, platooning will not be the norm until 2030.

Will Vehicle Automation Lead to Job Cuts?

While platooning will be a large advancement in trucking technology, it is nowhere near the self-driving cars we imagine when we think of vehicle automation. In fact, platooning will still require a high level of driver readiness. An alert and active driver will still be needed to operate each truck as they typically would, and the platooning safety features will only work to assist a driver.

This is great news for truck drivers across the world. Not only will trucking automation not cost them their careers, but it will make their jobs easier, safer, and better for the environment.

The Future of Trucking Technology

If you are still worried about vehicle automation claiming your job down the road, a recent study by the American Center of Mobility offers some comforting words on the subject.

“Automated vehicle technology could incorrectly be viewed as a change that will eliminate driving jobs; however, the more nuanced assessment is that over the next decade, the innovation will foster broader societal changes resulting in shifts in the workplace and workforce demands.”

This means there is nothing to fear when it comes to the vehicle automation. While it may change the way you do your job and change the landscape of the trucking industry as a whole, it will not soon result in truck drivers becoming obsolete. In fact, it is just the opposite. This new technology will mean that more jobs are created, and there will be more opportunities to grow your career and education in trucking.

As the trucker deficit continues, drivers are still in high demand across the country. And with new technology rolling out, now is an exciting time to get into the trucking industry. Don’t let the new automation advances scare you; instead, let them inspire you to grow in your career.

 

Are you looking to grow your career in the commercial trucking industry? Let Mission Financial help you with your financing needs and get you behind the wheel in no time.

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