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How is the HGV driver shortage affecting the consumers?

Posted on Friday, August 13th by

The mix between COVID-19 and Brexit, also called the “double whammy” is causing many issues within the country, one of the main one being the lorry driver shortage. Unfortunately, this issue is not only affecting the transport industry, but also other sectors which are solely relying on transportation. 

It is now very well known that there is a shortage of 100,000 HGV drivers, as per the Road Haulage Association (RHA) declarations, and the situation is considered to be critical. Both Brexit and COVID-19 contributed to this crisis, as many drivers decided to return to their home countries.

Apart from this, another important aspect is that the majority of HGV drivers have reached the retiring age, and because of the pandemic, the new recruits could not complete their training and tests to qualify to operate the lorries. 

According to RHA, the 40 largest hauliers who responded to its recent survey reported to have 3,654 vacancies, averaging 91 vacancies per haulier. 

"The driver shortage is down to the double whammy of the Brexit effect and pandemic disruption,” said Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown (HL.)

Susannah Streeter also said many drivers were made redundant at the start of the pandemic and the hauliers cannot recruit drivers from Europe, as drivers are not on the list of skilled workers eligible for special visas.  

The crisis’s impact on the consumers

The main impact can be the rising prices for groceries. "The shortage is pushing up wages and some of these costs already appear to be being passed into supermarket suppliers, who may only be able to absorb higher costs in the short term so there is a risk prices in the shops may rise as a consequence," declared Streeter. (...) This war for workers could be yet another inflation driver."

Tesco is offering a £1,000 bonus to lorry drivers who join the company before the end of September. This clearly shows that Tesco will be impacted if the situation is not solved in a timely manner. "We are reaching the point in which wide scale shelf shortages could be a genuine threat up and down the country," declared Will Broome, founder of Ubamarket, a retail tech app provider.

Laura Hoy, the equity analyst at HL, warned "it could be a challenge to find the right candidates in this environment, particularly on such a short timeline." She added that the shortage will also hit the consumer goods industry’s smaller players that "don’t have the financial firepower to get new drivers in right away."

Meanwhile, Morrisons has said it is working on schemes to train staff to become lorry drivers. And dairy giant Arla, which supplies milk to all major UK supermarkets, has said it is being forced to cut back on its deliveries. The company normally supplied 2,400 stores a day. "Last Saturday, there were 600 stores that we couldn't deliver milk to," managing director Ash Amirahmadi told the BBC.

Laura Hoy stated that with the pandemic guidelines becoming more relaxed, fewer self-isolations are expected going forward, which means more drivers will be available to work. “This looks like a short-term problem that shouldn’t have a lasting impact on the consumer goods industry.”

Also, RHA has asked for the introduction of a temporary worker visa for HGV drivers and for this role to be added to the Home Office Shortage Occupation List as it believes the problem needs government intervention. "Adding HGV lorry drivers to the Shortage Occupation List would help ease the current bottlenecks by enabling firms to bring in the skills they need from outside of the UK when they cannot recruit from the local labour market," said Suren Thiru, head of economics at the British Chambers of Commerce.



Source: Yahoo Finance 

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