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Why the truck school scams continue

 

Yesterday’s article focused on the latest Dan Rather Reports episode investigating truck driver training schools. The school featured on “Mind Your Loan Business” is Nu-Way Truck Driver Training Centers in Livonia. And the students may be your neighbors, relatives or friends. The Detroit area holds a number of truck driver training schools and truck driver training is offered at several community colleges. Rather focused on the irregularities in the loans students obtained to attend the school and the promises they said were not kept.

Anyone who’s been in the industry for awhile knows well the abuses that happen in the truck driver training industry. And most people know the job devastation that the near-failure of the Big Three auto companies wreaked on Michigan in general and the Detroit area in particular. A manager at Michigan Works Livonia office expresses that wide-spread devastation well when he states the industry really drove everything in the area and when it went, everything went.  However, Rather quotes ‘experts’ as stating that job training in the future in Michigan would be needed  in health care, information technology, accounting and transportation. In direct contrast to statements made daily in southern Michigan newspapers, he states that the largest job growth is being experienced in fields that require two years or less formal education. Daily, newspapers here report 'studies' that say Michigan's 'low-skilled' workforce will need two-to-four-year degrees to compete. There appears to be a disconnect here – but the disconnect, when you look at it, becomes worse.

An article this week by Avery Vise in eTrucker (an electronic news magazine for the trucking industry) titled: “Trucking loses 94,000 jobs in 2009” goes on to say that the for-hire trucking industry has shed 208,000 jobs since January, 2007 – 14.3%  of the total.  So much for that ‘recession-proof industry’.  He doesn't state statistics for job losses among  in-house fleets, but it’s a safe bet to say they certainly haven't added drivers with the poor economy. So, if the economy suddenly self-corrected tomorrow, one can assume there are about 300,000 truck drivers already trained, with experience, who could quickly return to work. Yet, the Commercial Vehicle Training Association says it trains, on an average, 50,000 new truck drivers a year. Where are the jobs these new truck drivers have been led to believe are waiting? Certainly, health care, information technology and accounting don't produce large volumes of freight you’d need truck fleets to move. You’re training drivers to haul freight that doesn't exist and most likely wont exist in the foreseeable future.

Yet, it becomes worse when you consider that Michigan is a dead-end state as far as trucking is concerned.  Major highways don't go through Michigan on their way to somewhere else – it’s the end of the road. And trucking companies don't just send trucks willy-nilly: they need freight going two ways to show a profit. Unless a carrier has freight going into Canada, they have little reason to be here, with no automotive freight going out. That reduced auto freight has been consolidated into a few carriers and/or a few lanes mostly originating from out of the state in areas with a larger freight base. Many of the larger carriers don't hire Michigan drivers as they don't have regular area freight. Getting those drivers home costs them fuel and deadhead miles. And drivers living at the other end of the route, Texas perhaps, can work for less due to lower cost of living. Those are the better jobs – and they’re not up for grabs to new trainees.

So why do the Dept of Labor, the so-called ‘experts’ and even Michigan Works still attempt to encourage truck driver training? Because they’re all operating on a faulty assumption that there has been a ‘truck driver shortage’ until the last year! Behind that faulty assumption are the major carriers who have continually assailed Congress with their supposed desperate shortage of truck drivers. In truth, there hasn’t been a shortage of truck drivers since at least 2002 – and it was questionable even then. In a job category that often experiences 160% turn-over of drivers annually, it’s far easier to whine about a driver shortage than to correct the conditions that make the industry such a lousy place to work. When you can  pay a new driver half of what you pay an experienced one (one of the reasons for the high turn-over) AND you can get the government to pay at least part of the cost of training that new driver, it doesn’t make good economic sense to try to hang on to the drivers you’ve already got. Many of the large carriers shed 160 drivers for ever 100 driver they hire . . .but that doesn't mean 160 drivers left the field. Most are part of the 100 drivers the next carrier hires in a continual churn of the workforce as drivers look for better pay, better working conditions and fairer treatment.

We all know government is too big and far too slow on the uptake to correct it’s faulty assumptions. It’s aided in maintaining it’s head in the sand by the fact that many displaced truck drivers don’t end up on the unemployment roles as laid off. The industry seldom lays drivers off: without the protection of Fair Wage and Hour laws, they don’t have to pay them an hourly wage. Instead, they’re paid by the mile. If you simply don’t give them any miles, they will eventually quit-usually within a couple of weeks. In the industry, it’s known as a starve-out. Unless they’re very knowledgeable, they will be refused unemployment benefits as they ‘voluntarily’ left the job. Or, you can terminate them on some trumped-up violation of rules nobody can prove and keep them from receiving benefits for at least thirteen weeks. They are now part of the 160 drivers who ‘left’. A carrier can force attrition within it’s workforce with very few of the costs encountered by most businesses wishing to reduce the size or location or age of their workforce. And you can always send the lobbying group to Washington to whine you need help solving your self-created driver shortage. The cycle continues, as it has for many years. Your tax dollars will pay the major cost of training new victims of the scam.

So big, slow and dim-witted government keeps printing the reports that say there aren't enough truck drivers. And Michigan Works, who bases their training decisions on the reports coming out of DOL continues to send the long-term unemployed to truck driver training school. Truck driver training schools keep springing up like dandelions after a spring rain, funding and loan scams keep appearing to remove even more cash from the pockets of the desperate unemployed – who often have only a vague idea what the job even entails - and the tycoons in the trucking industry has a never-ending pool of nearly slave labor paid for by the tax-payers.

THAT’S the underlying story and the underlying shame in this entire story. If anyone can figure out how to end this revolving door, has an idea that hasn't been tried before, I’d love to hear it. Meanwhile, don't let your friends and family fall for this scheme as it isn't an answer to their unemployment in this economy. Particularly in Detroit, Michigan.

Previous articles relating to this:

Dan Rather Reports explores CDL training

Dan Rather Reports explores CDL training – pt 2

Dan Rather Reports explores CDL training . . part 3

Dan Rather Reports explores CDL training . . part 4

Dan Rather Reports explores CDL training . . part 5

Dan Rather Reports: Truck Talk

Comments

  • AuthorFrank.com 4 years ago

    Trucking is not alone. My wife took a local course supported my the State of Michigan for medical billing and coding. She was also a nurse. Guess what? The lady sitting next to her in another on-line training course had just lost her medical coding job to an outsource in India. Point: Different training; same scam!