The HGV driver shortage has been a widely reported issue in recent months, but this shortage has long existed. Brexit and COVID-19 have exacerbated a pre-existing retention issue. We consider the causes of the shortage and look at the various potential solutions.
Why is there an HGV Driver Shortage? The Road Haulage Association has reported a shortage of some 100,000 HGV drivers (though recent estimates place this figure closer to 70,000). The two factors usually cited as the root causes of the HGV driver shortage are Brexit and COVID-19 but IR35 has seen drivers source work overseas.
What is the Solution? Ultimately, there is no single solution. A wide range of short-term and long-term efforts are required. Here are a few that are being suggested or have been implemented:
Introducing Visas The government introduced visas for HGV drivers of fuel and food goods in order to provide a short-term solution. But these visas were only available to 5,000 individuals. This far from covers the 12,500 EU nationals that left their roles since 2020, or the 52,500 British drivers who have also departed the workforce. Furthermore, even if the visa was available to more drivers, as there are HGV driver shortages across mainland Europe (albeit to a lesser extent that in the UK) a short-term visa to work in the UK may not attract enough drivers to apply. Nonetheless, this may act as a stopgap while new drivers are trained or as benefits are improved to entice drivers who have switched careers.
Utilising the Military The drafting of the military personnel as HGV drivers is not expected to be a long-term solution.
Improved Wages – some commentators advocate for the industry to self-correct in a free market. In order to meet the increased demand for drivers, haulage companies contracting or employing HGV drivers will have to increase wages (especially for antisocial hours), improve work patterns and shifts to provide better work-life balance, and provide better facilities. Many in the industry have already increased wages (some reportedly by 40%) but recruitment has still faltered as work-life balance is still a source of complaint – seemingly, more holistic changes are required.
IR35 The changes to IR35 last April led to a lot of HGV drivers leaving the industry, certainly the contingent labour market. Drivers enjoyed the professional status of being self-employed and the lower tax burden that self-employment created. The IR35 changes led to many end users of contingent drivers assessing their assignments as being inside IR35 which meant that the drivers were either pushed into a PAYE solution and lost their self-employed status or remained self-employed but lost the tax advantage of that status. This led to a lot of drivers that worked for employment businesses choosing to walk away from the industry. Those employment businesses that have embraced this issue and looked at how they can maintain self-employed status, outside of IR35 have reported some success in increasing the number of drivers on their books.
Reduced Cost of Training A further solution is to reduce or subsidise the cost of training. Currently, training to become an HGV driver can cost thousands of pounds which can deter interested individuals. The government introduced a scheme offering 5,000 places on training courses, new ‘skills bootcamps’, and local funding. While this may help to address the immediate shortage, the chronic issue in the sector has never been the supply of new drivers but retaining them. Some commentators have suggested that to lower the barrier to become an HGV driver, the government should permanently subsidise training costs and work with insurance providers to provide insurance cover at better rates for inexperienced drivers.
Better Working Hours Many drivers have called for businesses to provide more favourable terms in regard to shift patterns, working hours, and breaks to facilitate better work-life balance and working conditions. Where businesses fail to do this, the government may amend the Working Time Directive and Tachograph Hours rules to give drivers longer or more frequent breaks and limit daily driving hours.