In the latest Driver Require Ltd report titled “The Impact of COVID-19 – A Roadmap for Recovery in the UK Haulage Sector”, released in early July, Driver Require CEO, Kieran Smith, made the bold statement that there will no longer be an LGV driver shortage in the UK; at least not until we are fully out of the post-COVID-19 recession. A new bulletin sees Smith explain why we now believe the LGV driver shortage will remain unresolved and could potentially worsen, at least in the short term.
Driver Require’s report concluded that the predicted drop in GDP due to the impact of COVID-19 could cause a 10% reduction in LGV driver employment numbers (approximately 30,000 drivers) for the next couple of years. This would, in theory, help offset the perceived pre-COVID-19 shortage of over 50,000 LGV drivers, but other factors are at play with the potential to reduce the available LGV driver pool beyond the drop in demand. It’s also possible that the timing of these factors could combine to exaggerate conditions.
In a previous white-paper that detailed the Driver Shortage, Driver Require established that the UK needs to maintain a flow of 40,000 new entrants (new LGV passes) to keep the driving pool at its current level. But Lockdown has seen the flow of new passes dry up, and it appears that DVSA testing facilities will not operate above 60% capacity until a vaccine is deployed (currently forecast for the end of Q1, 2021).
Kieran Smith, CEO of Driver Require, explains in the bulletin: “Due to lockdown and capacity restrictions at testing sites, we have effectively “lost” over 16,000 new passes so far. If the training and test capacity continues at around 60% until a vaccine is successfully deployed, we “lose” another 14,000 new passes, bringing the total to about 30,000.”
“At best, the UK LGV driver shortage might improve (the deficit will decrease) by around 10,000 drivers, but this assumes that the foreign drivers remain working in the UK. This is an optimistic assumption given the mounting factors likely to alienate them: Brexit, the new immigration rules, IR35 reform and on top of all this: COVID-19. We only need a quarter of these foreign drivers to leave to completely eliminate any easing of the shortage caused by the COVID-19 recession.”
From now until the end of this year, a combination of post Lockdown backlogs and Winter Peak requirements should lead to demand exceeding supply. Smith then predicts that demand for LGV drivers will plummet in the first six months of 2021, while Brexit unravels and IR35 reforms are rolled out to the Private Sector. He then forecasts that the driver shortage is likely to rear its head again when the LGV market stabilises in the second half of 2021.
Driver Require is enlisting the support of industry experts and academics to try and get greater clarity on factors used to make their calculations, so they can more accurately predict the extent of the problem. In the meantime, it is difficult to see the LGV driver shortage diminishing significantly and, if anything, it could worsen periodically over the coming 18 months unless there is determined Government intervention.
Interesting read! There is a lot of uncertainty in the sector at the moment but it has certainly shown it’s resilience, importance and ability to adapt during Covid. The Driver shortage will be an issue for the years to come but nothing we can’t solve if we look at innovative solutions to resolve the shortage.