15.Concern about a shortage of drivers is not new. In a joint statement ahead of a meeting with HM Treasury in February 2015, the Freight Transport Association (FTA) and the Road Haulage Association (RHA) estimated that the haulage industry was short of about 45,000 drivers and that a further 40,000 drivers would leave the industry by 2017.
16.In their evidence to our inquiry the FTA said that the sector was short of 43,000–45,000 drivers but the RHA suggested it was closer to 60,000. Asked to explain the difference, Jack Semple, of the RHA, told us it drew a distinction between drivers holding only an LGV licence and those holding a licence and DQC. The RHA added that the ONS classification of drivers under-reported driver numbers, as someone reporting their occupation as delivery driver might not be counted towards the total of LGV drivers.
17.The Government agrees with the industry estimate of a shortage of about 45,000 drivers. It told us that the problem was long-standing and had been evident a decade ago.
18.During the inquiry we saw plenty of evidence to support the contention that there is a driver shortage. There are more vehicles than drivers (see paragraphs 8 and 10). Typically businesses need more drivers than vehicles as a number of operations require more than one driver per vehicle as a consequence of the limits on drivers’ hours. In its evidence the FTA said the ratio of drivers to vehicles was 0.9 and suggested that industry needed a ratio of 1.4 drivers for every vehicle. The RHA told us the UK needs to be training around 35,000 new drivers each year but only about 17,000 new LGV licences are issued each year.
19.According to the National Careers Service the proportion of vacancies in this sector is higher than the UK average and the UK Commission for Employment and Skills found that LGV driver was not listed in the top ten hard jobs to fill in 2012 but was third by 2014. In FTA’s July 2015 survey of members over 80% of companies surveyed reported delays in being able to hire permanent LGV drivers. Unite the Union’s evidence provided us with a broadly similar figure. The FTA’s survey highlighted particular problems in distribution, where 91% of companies surveyed reported problems recruiting. Martijn de Lange, Chief Operations Officer, Hermes Europe, said companies were finding it really hard to get hold of drivers; he said the problem was getting worse as did a number of other witnesses. Colin Snape, HR Manager, Nagel Langdons Ltd, told us “we have really had to go out of our way to attract drivers”.
20.In April 2015 fewer than 1,200 people claiming jobseekers’ allowance listed LGV driver as their usual occupation. This could lend support to the argument that there is a shortage of drivers; although other interpretations of these data are possible; for example those wanting to leave the sector might choose not to refer to themselves as drivers.
Figure 4: Employment and unemployment of LGV drivers, United Kingdom, 1999–2015
21.We also found evidence to suggest claims of a driver shortage were over-stated. A recent article suggested that as many as 80,000 drivers aged 25–44 had an LGV licence and DQC but did not work as drivers (possibly maintaining their entitlement to drive in case other career choices did not work out). Data from the DVLA show there are more than enough people either licensed or licensed and qualified to drive LGVs but for a number of reasons they choose not to work as drivers (see figure 5); Adrian Jones, Unite the Union, and Nathalie Axon, Founder and Director, Horsepower training Ltd, both said that this was the case. A larger number of people hold an LGV licence but not a Driver CPC. With around a week’s worth of training they could obtain the qualifications needed to work as a driver (see figure 5).
22.Clearly some of these will be people exempt from the Driver CPC and some will hold an LGV licence for other reasons (such as those who drive large vehicles recreationally and who have no interest in driving professionally). Even allowing for this there seems to be a large pool of people who could work in the sector. Nathalie Axon said “There are a lot of people out there who have the licence and who are sick of the conditions at the moment”. Not shown in figure 5 are the drivers who have not renewed their licence and DQC but could do so if motivated to return to the sector. Kat Springle, Operations Director, Easy as HGV, told us that newly qualified drivers would often wait for the right role.
Figure 5: Holders of LGV licences and Driver Qualification Cards
23.The Department’s road freight statistics show that more vehicles are off the road through lack of work than lack of a driver. Only 1 in 100 LGVs is off the road because there is no driver while 15 in every 100 are off the road because there is no work (see figure 6).
Figure 6: LGVs not working during the week, 2014
24.We believe that a major reason for the driver shortage is a shortage of people willing to work in the sector rather than a shortage of people with the right qualifications and licences. It seems to us that the apparent shortage will get worse unless action is taken to improve retention and increase recruitment.
25.The nature of the job affects the industry’s ability to recruit and retain LGV drivers. The job involves long “periods of availability”, some working away from home and international travel, and complicated regulatory requirements (working hours, medical requirements, age limits etc.); these can put some people off working in the sector. Operators are reluctant to take on newly qualified drivers as insurance costs can be prohibitively high, especially for those drivers under 25 years of age. Tight operating margins and a mobile workforce make it difficult for operators to invest in driver training. Smaller operators have less scope to absorb the costs of training, licence acquisition and insurance than larger companies.
26.The Department attributed the driver shortage to:
27.Several of the factors affecting recruitment and retention of LGV drivers relate directly to drivers’ terms and conditions, including:
28.Other factors affecting a driver’s willingness to work in the sector and operators’ ability to recruit and retain them, include:
We consider the policy response to and make recommendations on these issues later in this report.
29.Unite the Union raised the issue of monitoring of drivers and suggested this was a factor that could put people off working in the sector. They welcomed the use of technology to enforce existing legislation (such as that on drivers’ hours) but expressed concerns about the use of in-vehicle technology to monitor the driver. They said:
The ‘spy in the cab’ is being used by employers to monitor drivers and on some occasions to bully them into doing more and faster. Even on-vehicle camera manufacturers have admitted that there is no valid reason for having cameras in the cab of commercial vehicles and that it could in fact have a detrimental effect on the driver.
30.The age of vehicles may have an impact on driver recruitment and retention. The average age of the LGV fleet is rising. This may be due to the recession encouraging companies to eke out the last bit of use from their vehicles before scrapping them, or it could be that more modern vehicles are able to go a little longer before they become uneconomic. It is clear that there are number of significantly older vehicles on the roads—the proportion which were 10+ years old has risen from 22.7% in 2006 to 29% in 2015. The vehicle inspection regime should make sure this does not present a risk to safety but it does mean more than half of all LGV drivers are putting up with all the other problems they could face in the cab of a lorry that has already seen more than ten years of service.
31.If drivers leave the sector at a rate greater than new drivers can be recruited the shortage will get worse. Independent analysis of the driver shortage, commissioned by the FTA, showed that over the last 15 years there has been a steady increase in average driver age, rising from 45.3 years in 2001 to 48 years at the present time. Over 60% of LGV drivers are aged 45 years and over compared to 35% in the general working age population. Around 10% of the total employed population (of working age) is under 25 but only around 1% of LGV drivers are under 25. David Wells and Jolyon Drury both said the full effect of the large number of drivers aged 45 and over would not be felt for a number of years to come. Around 20% of drivers could reach the age at which they could consider retirement in the next ten years. In January 2016, Skills for Logistics told the APPG on Freight Transport that around 75,000 LGV drivers would reach retirement age in the next ten years.
Figure 7: Cumulative employment by age
32.We conclude that there is no single cause for the driver shortage but a combination of a number of factors make the job less attractive than it was. It is imperative that the industry takes steps to improve the terms and conditions so it can recruit and retain the drivers it needs. The industry, supported by the Government, will need to invest more in recruitment, training and driver welfare following years of under-investment. We acknowledge that this is challenging for many of the smaller operators, especially given the very tight margins operators face. To improve conditions it will be necessary to address the inadequate facilities provided currently for drivers. It will also be necessary to promote the sector better in schools and colleges. We are also concerned about the terms and conditions under which some agency drivers are required to work.
33.There are a number of developments that could suppress demand for drivers in the future. In 2016 the Government announced further support of the development of driverless vehicles and trials of lorry platooning on the strategic road network. Social Research Associates Limited told us that new technology such as driverless vehicles and the “managed motorway” were likely to deskill and reduce demand for drivers.
34.The Committee heard about the use of longer trailers, currently prohibited in the UK but road-legal in some European countries. Such trailers could allow for the transport of larger volumes of bulky but not heavy goods, thereby offering a partial solution to the driver shortage. We welcome the Department’s trial of longer semi-trailers for articulated goods vehicles, which began in 2012. Given that the trial could last up to ten years, it is important that it is flexible enough to encompass new and emerging technologies aimed at increasing the capacity of lorries. This is an issue which the Department needs to revisit.
35.In answer to a recent Parliamentary Question, Andrew Jones MP, the Roads Minister, noted that the shortage was manifesting itself in pressures on costs, delays to some deliveries, and a dependence on foreign drivers.
36.The Recruitment and Employment Confederation (REC)’s survey of members found 94% of the distribution companies surveyed had been unable to fulfil orders from clients because of the lack of a driver. We had received other anecdotal evidence of delays to deliveries but there was little direct evidence. In December 2015 there were several reports to the effect that the shortage of drivers would disrupt delivery of food and goods ahead of Christmas. Similar stories appear each Christmas but we received no evidence of delivery failures at Christmas. David Wells, Chief Executive, Freight Transport Association, acknowledge that Christmas was “delivered”.
37.The CILT found its members had lost business as a result of the driver shortage as did the REC’s survey of members.
38.Martijn de Lange, Hermes Europe, told us that wages were rising as a result of the shortage. The REC’s survey of members found that 59% of operators in distribution had increased pay to attract more drivers and 73% thought that driver pay rates would grow significantly given the shortages. However, there was no evidence of a systematic failure in the labour market for drivers and the wage inflation reported by FTA members is not borne out in the data on wages in the sector. The Department said the industry was highly competitive and the driver shortage had not caused wage inflation. Official figures indicate average gross weekly wages for heavy goods vehicle drivers in 2015 had increased by about 4% over 2014.
Figure 8: Median gross pay for drivers of LGVs, vans, buses and coaches
39.The appearance of a functioning job market and absence of wage inflation might, in part, be explained by the dependence of the road haulage sector on agency drivers and foreign drivers to fill vacancies. The Government told us that the substantial number of non-UK EU nationals is likely to be suppressing wage growth while continuing to support the functioning of the logistics industry. It said:
[…] the use of agency drivers provides the logistics industry with the flexibility it needs to respond to short-term peaks in demand for goods. It is a legitimate and reasonable part of the labour market and the Government has no plans to ban or restrict this mechanism.
40.Nathalie Axon and others were less complimentary about the part played by agencies, saying agency work offered a lack of security and certainty and suggesting some job adverts were placed just to get lots of names on an agency’s books. The RMT told us about their concerns over how the EU’s Agency Workers Directive had been transposed into UK law and the effect this had on agency drivers. Under the EU rules, temporary workers are entitled to the same pay and conditions as permanent staff after 12 weeks of continuous employment. Under the “Swedish derogation”, employment agencies are exempt from having to pay a worker the same rate of pay as long as the agency directly employs the individual and guarantees to pay them for at least four weeks during the times they cannot find them work. Agency workers can then be contracted out to other employers. Without the on-costs agency drivers are cheaper to employ, despite having a slightly higher hourly wage. Unite the Union said that this was undercutting terms and conditions in the industry and eroding sustainable careers for workers in the industry.
41.The driver shortage has resulted in a dependence on agency and particularly foreign drivers that goes beyond what is needed to cope with seasonal variations and is now necessary to sustain normal operation. The dependence on agency staff means that operators in the sector are probably not investing enough in their staff. We think this creates two risks that need to be managed. First, if the UK becomes relatively less attractive as a place for foreign drivers to work, as it may do as the consequences of Brexit play out, the shortage could become much more acute, possibly quite rapidly. Second, the longer-term sustainability of the UK’s road haulage sector could be undermined if there is not a steady stream of people through the sector gaining the skills and experience that they need to become transport managers and operators.
31 See for example: Scottish Road Haulage Modernisation Fund Driver Retention, , September 2003; European Parliament, , 2009; Skills for Logistics, , April 2012; UK Commission on employment and skills, , October 2014; All Party Parliamentary Group on Freight, , January 2015
32 Lloyd’s Loading List, , February 2015
33 Freight Transport Association ()
34 Road Haulage Association ()
36 Road Haulage Association ()
37 Department for Transport () and
38 Department for Transport ()
39 Freight Transport Association ()
40 Road Haulage Association () (See also , An independent analysis of the current driver shortage prepared for FTA by RepGraph Ltd, November 2015)
41 Office for National Statistics, , 15 June 2016
42 UK Commission on employment and skills, , October 2014 (p.5) (See also The Chartered Institute of Logistics and Transport ())
43 Freight Transport Association ()
44 Unite the Union ()
46 [Jack Semple], [David Wells], [Adrian Jones], [Nathalie Axon]
48 , Kirsten Tisdale, Aricia, 12 January 2016
52 Department for Transport, Road Freight Statistics,
53 Freight Transport Association ()
54 Freight Transport Association ()
55 Department for Transport ()
56 Unite the Union ()
57 Unite the Union ()
58 [Adrian Jones]
59 [Jack Semple], [Adrian Jones], [Adrian Jones], [Jolyon Drury]
60 Unite the Union ()
63 Skills for Logistics, , April 2012
64 The Chartered Institute of Logistics and Transport ()
65 Recruitment & Employment Confederation ()
66 [David Wells, Jack Semple], [Colin Snape]
68 Department for Transport ()
69 Unite the Union ()
71 House of Commons Transport Select Committee, , First Report of Session 2016–17, HC65, May 2016
72 [Jack Semple, David Wells], [Jenny Tipping]
73 The Chartered Institute of Logistics and Transport ()
75 [David Wells]
76 [Colin Snape]
77 Freight Transport Association (), Food Storage and Distribution Federation ()
78 Department for Transport, , March 2015
79 Unite the Union ()
80 FTA evidence : An independent analysis of the current driver shortage prepared for FTA by RepGraph Ltd, November 2015
82 FTA evidence : An independent analysis of the current driver shortage prepared for FTA by RepGraph Ltd, November 2015
83 Freight Transport Association ()
84 Social Research Associates ()
85 [David Wells, Jack Semple]
86 Department for Transport, [accessed on 20 July 2016]
87 PQ on Large Goods Vehicle Drivers, 22 October 2015
88 Recruitment and Employment Confederation ()
89 [Adrian Jones], [Jolyon Drury]
91 The Chartered Institute of Logistics and Transport ()
92 Recruitment and Employment Confederation ()
94 Recruitment and Employment Confederation ()
95 Department for Transport ()
96 [Martijn de Lange]
97 Department for Transport ()
98 [Jack Semple], [Adrian Jones], [Jolyon Drury]
99 Department for Transport ()
100 Department for Transport ()
102 [Adrian Jones]
103 Unite the Union ()
27 July 2016