The Trucking Industry Is Struggling, But Maybe Not For Long

Trucking, the backbone of American commerce, is in a tough spot.

There might be a future, a very long time from now, when long-haul drivers are replaced by fully self-driving vehicles. But today, trucking has the opposite problem. It's looking at a significant shortage of drivers -- 48,000 open positions in an industry of 800,000 -- and trying to figure out how it will fill that hole.

Is trucking in crisis or is the pendulum about to swing the other way? 

The industry accounts for more than two-thirds of the freight tonnage moved throughout the country in any given year (the rest is moved by rail and air) and more than 80 percent of freight transportation revenues, according to Bob Costello, the chief economist at the American Trucking Association, a trade group for the industry. But despite its importance, it poses a perennial problem: It's a difficult job to do.  

A long-haul driver without much experience has years ahead of him (it's almost always a him) without much control over his schedule. He might be on the road for days or weeks at a time, with designated places he is allowed to refuel and restrictions on the routes he can take. He'll get paid decently for a guy without a college degree, but not great, probably somewhere between $35,000 and $40,000 a year, maybe a little more. (That's according to the Bureau of Labor Statistics. The industry says it's higher.) His pay could go up to $55,000 - $60,000, if he makes it in the industry. But he'll have to keep driving, through rain and snow and sleet, for a few years before that happens.

Pay in the industry tracks pretty closely with inflation. The fact that pay has grown below inflation for the last few years -- meaning drivers are seeing pay cuts in terms of what they can buy, if not in their salary itself -- is a fairly easy explanation for why there's a shortage of drivers today.

But things may be changing. Since late 2013, long-haul truckers' average pay has increased 17 percent, according to National Transportation Institute numbers reported by the Wall Street Journal. By contrast, wages in the U.S. overall "rose by less than 4% over the same period," notes WSJ. 

Higher pay will likely plug the industry's driver shortage, for now. But turnover may continue to be a problem. It's hard to be a hiring manager at a trucking business. 

The long-haul industry is what an economist would call nearly perfectly competitive. It's fairly easy to start a company -- you just need a truck and a driver -- so any move that a company makes that doesn't fit with market conditions means that that company's business can quickly and easily go elsewhere. 

Traditionally, driver turnover in the industry is very high, and in recent years has been  between 90 and 100 percent, if not higher. That means for nearly every new recruit who gets his commercial driver's license, someone else quits. 

In addition, it's illegal for people under 21 to drive a truck commercially across state lines. That makes sense: Younger people are worse at driving and tend to make more reckless decisions behind the wheel. But practically, it presents a recruiting problem for the industry. It's such a problem that the industry is trying to lobby Congress to change the rule and allow 18-year-olds to drive trucks across state lines. 

"We miss out on the folks that are coming out of high school who don’t go to the military," said Costello. "They can’t sit around to wait [to turn 21]." Instead, they go out and get different kinds of jobs, and don't turn to trucking as a potential career until much later. At training centers, companies mostly see guys in their mid-30s, said Costello.

"It's not clear where the new truck drivers are coming from as baby boomers age out," said Stephen Burks, an economist who studies the trucking industry at the University of Minnesota Morris.

About 70 percent of long-haul trucking is done on a contract basis, according to Burks. The contracts can last a year or longer, meaning companies agree to a set price for trucking for long periods, during which time plenty of things can change in the economy. This means that trucking companies can have trouble reacting to economic forces quickly because their prices are set so far in advance. That can lead to driver shortages in the short term.

An upcoming paper that Burks will publish with Kristen Monaco at the Bureau of Labor Statistics finds that "[w]hile the business problem facing [long-haul] firm managers gets more difficult to solve when freight demand increases, over time wages rise and the turnover rate comes back down."

Trucking's current shortage might end up being a lag in the market, rather than a true scarcity of available drivers -- although a company trying to figure out how to get more drivers on the road may not care about the distinction. But, Burks says, that's the nature of the industry. "It’s not like you could choose a different business model."  

In other words, trucking is tough but the challenges are predictable. When pay rises, driver shortages disappear. Eventually, though, pay stagnates and the cycle starts up again.

The People Taking Care of Our Kids Are Some Of America's Lowest-Paid Workers

The people taking care of America's children are some of the lowest-paid workers in the country, according to a study published Thursday by the Economic Policy Institute.

The report found that nationwide, median pay for child care workers is $10.31 per hour -- 39.3 percent less than the median wage of $17 an hour earned by workers in other sectors. In fact, a look at official data shows that median child care worker pay is only slightly higher than median pay for retail salespeople, which is $10.29 an hour. 

At the same time, child care is prohibitively expensive for most American families.

Given child care workers’ lower median earnings, it is not surprising that they are much more likely to be living below the federal poverty level than Americans working in other occupations.

The poverty rate among child care workers, the report notes, is 14.7 percent -- more than twice the rate of 6.7 percent for other American workers.

The new study, which used Bureau of Labor Statistics numbers, follows an October report by the EPI showing that child care is as expensive as a year of public college tuition, making it unaffordable to the typical middle-class American family.

If the first report demonstrates how unaffordable American child care is, the second one shows that the exorbitant cost of care does not necessarily go toward paying the people doing the job.

Elise Gould, an author of both studies and senior economist at the EPI, makes clear that Thursday’s report seeks to raise questions about how the treatment of the workers affects the quality of the care itself.

“Despite the crucial nature of their work, child care workers’ job quality does not seem to be valued in today’s economy,” Gould writes in the report’s introduction.

Indeed there is ample evidence that child care workers’ poor pay has already had a negative impact. Most American day care providers offered care that was “fair” or “poor,” according to a 2007 government study. Only 10 percent of providers offered what the study called high-quality care.

The report also highlights how child care workers’ meager pay is especially harmful to women and people of color. Nearly all -- 95.6 percent -- of the 1.2 million people earning a living as child care workers are women. By contrast, women make up fewer than half of the workers in other fields.

Child care workers are also disproportionately likely to be Latino or African-American. One in five child care workers is Latino, compared with 15.7 percent of other kinds of workers. And 14.6 percent of child care workers are black, compared with 10.6 percent of workers in other occupations.

For the purposes of the study, the EPI defined child care workers as preschool teachers and professional caregivers for infants and young children. All figures are current to 2014.

The report acknowledges that child care pay is higher -- and goes further -- in some cities and towns than others.

But based on the EPI’s Family Budget Calculator, which accounts for geographic variation and measures a broader array of household expenses than the federal poverty level -- including child care, transportation and health care costs -- these people are not making enough.

Over 90 percent of non-preschool child care workers earn less than a single person needs to live in the majority of the 618 metropolitan areas examined in the EPI’s Family Budget Calculator. A single person would need an income of $26,832 a year to live in the Des Moines, Iowa, area, the median-costliest community the EPI budget calculator examined.

The map below shows the percentage of non-preschool child care workers who cannot afford to live in metropolitan areas across the country. Head over here for an interactive version where you can search by zip code.

The slightly higher-paid preschool instructors are still unlikely to be able to afford living in many metropolitan areas.

That is especially true if they have children. In fact, ironically, these workers may have to choose between child care and other essential needs. Day care alone for infants in 32 states and the District of Columbia amounts to about one-third of a median preschool instructor’s annual pay.

In addition to lousy pay, child care workers are far less likely than their peers in other fields to receive health and retirement benefits on the job. Employer-sponsored health insurance is available to just 15 percent of child care workers, compared with 49.9 percent of workers in other professions. And employer-sponsored pension plans are available to 9.6 percent of child care workers, compared with 39 percent of workers in other professions.

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5 Best Cities To Live In

This story was originally published on 24/7 Wall St. 

Moving within the United States from one city to another is much more common today. No matter the reasons for the move — buying a house, looking for a new job, leaving home for the first time — it remains a major undertaking. A host of factors play an important role in the decision where to move, including the quality of schools, the strength of the local economy and job market, safety, culture, and even climate. Americans facing this decision have much to consider.

To determine America’s best cities to live in, 24/7 Wall St. reviewed data on the 550 U.S. cities with populations of 65,000 or more as measured by the U.S. Census Bureau. Based on a range of variables, including crime rates, employment growth, access to restaurants and attractions, educational attainment, and housing affordability, 24/7 Wall St. identified America’s 50 Best Cities to Live.

Click here to see the 50 best cities to live.

Click here to see our methodology.

According to Elise Gould, senior economist with nonprofit think tank the Economic Policy Institute (EPI), “most people move because of jobs.” Indeed, for many families on the move, the prospect of obtaining a job is often the most important — if not the only — consideration. For this reason, 24/7 Wall St. weighed this factor heavily when identifying the best places to live.

Of the 50 best cities to live, 41 have unemployment rates below the national rate, and all but five have had faster recent job growth than the national job growth rate. Incomes in these cities, when adjusted for cost of living, exceed the national household income of $53,657 in the vast majority of cases.

The affordability of housing was another key measure in our assessment of U.S. cities. The median home value in all but nine of the 50 cities exceeds the value of a typical American home of $181,200. Since housing prices are often tied to local and statewide market forces, a particular city’s home value was more often compared to statewide home prices. In all but a handful of the best cities to live, the city’s median home value was greater than the comparable state figure. In six of the 50 cities, a typical home was valued more than double the statewide value.

The ability to live safely in a given area is also a top priority for American families on the move. The violent crime rate, therefore, was another key measure when determining the best cities to live. Because violent crime rates tend to correlate with other measures of livability, these cities tend to have very low crime. The violent crime rate in the vast majority of the best cities to live is less than half the national violent crime rate of 365 per 100,000 residents.

Population growth was not part of our assessment of cities, but we excluded cities with negative population growth from our analysis. The most desirable cities to live in tended to have above-average population growths in the last decade.

As Gould observed, designing a singular index of this kind can be a challenge because people move to — and either grow to love or hate — a city for a variety of often-personal reasons. Indeed, while jobs are a major determining factor for a move, people often prefer to stay where they are because of other reasons. “And that could be city amenities, it could also be proximity to family and friends,” Gould said.

Many of the best cities are located near major cities, as this proximity provides residents with access to good schools while living in safe neighborhoods. It also allows them to enjoy the amenities available in the nearby larger cities.

Perhaps surprisingly, none of America’s largest cities are on this list. There is no New York, Los Angeles, or Houston among the best places to live. Nearly all of the biggest cities in the country by population had crime rates that automatically excluded them from consideration. Additionally, the largest cities tend to have higher poverty rates, making them less likely to qualify.

• 5
  Eagan, Minnesota > Population: 66,087
  > Median home value: $243,200
  > Poverty rate: 7.9%
  > Pct. with at least a bachelor’s degree: 52.1%
  > Amenities per 100,000 residents: 186.1
  
  
  With a population of just over 66,000, Eagan is not an especially large city. However, located just across the Mississippi and Minnesota Rivers from Minneapolis and St. Paul, Eagan residents do not have to travel more than 20 miles to access a major metropolitan area. Also, unlike the Twin Cities, Eagan is one of the safest cities in the country. Only 24 violent crimes were reported in 2014 making Eagan home to the sixth lowest violent crime rate of any city in the country. One possible explanation for the low violent crime rate may be the city’s low unemployment rate. Only 3.3% of Eagan’s workforce is out of a job, a lower unemployment rate than in all but 10 U.S. cities.
  
  While the cost of living in Eagan is roughly 2% higher than it is on average across the nation, incomes are also higher. The typical U.S. household earns $53,657 annually. The median household income in Eagan, however, is $78,884 per year, about $25,000 more than the national figure.
• 4
  Centennial, Colorado > Population: 107,193
  > Median home value: $328,800
  > Poverty rate: 4.8%
  > Pct. with at least a bachelor’s degree: 56.3%
  > Amenities per 100,000 residents: 383.4Higher educational attainment usually leads to higher incomes, and while only about 30% of American adults have a bachelor’s degree, more than half of all adults living in Centennial have a bachelor’s degree. The typical household in Centennial earns more than $91,000 annually, about $30,000 more than the typical Colorado household. The city also has a low poverty rate. Only 4.8% of Centennial residents live below the poverty line compared to a poverty rate of 12.0% in Colorado and a national rate of 15.5%. Centennial high schools also yield better results than high schools across the state. Standardized test scores are about 6% higher in the area than they are across Colorado. Growing slightly faster than the U.S. population, Centennial expanded by 6.6% over the five years through 2014 to its current level of roughly 107,000 residents.
• 3
  Johns Creek, Georgia > Population: 83,108
  > Median home value: $332,700
  > Poverty rate: 4.5%
  > Pct. with at least a bachelor’s degree: 66.9%
  > Amenities per 100,000 residents: 629.3While Georgia generally fares worse than most states in many social and economic measures, Johns Creek residents benefit from high incomes, low poverty, high levels of education, and plenty of amenities. The median annual household income in Johns Creek is nearly $100,000, roughly double the state’s median income. Also, the poverty rate of 4.5% is considerably lower than the the national poverty rate of 15.5% and even more so than the state rate of 18.3%. High levels of education among area adults partly explain the high incomes and likely improve the quality of life for the local community in a variety of other ways. Nearly 67% of adults in Johns Creek have at least a bachelor’s degree, more than twice the nationwide corresponding education attainment rate and one of the highest of any city.Johns Creek residents also have access to a remarkable number of leisure activities, especially restaurants. There are around 630 eating locations per 100,000 city residents, the second highest concentration of such amenities in the nation.
• 2
  Danbury, Connecticut > Population: 83,795
  > Median home value: $283,400
  > Poverty rate: 11.5%
  > Pct. with at least a bachelor’s degree: 33.3%
  > Amenities per 100,000 residents: 260.2The best places to live are not necessarily affordable. Danbury, the best U.S. city to live in after only Meridian, is in Fairfield County, Connecticut, one of the most expensive areas in the nation. The cost of living in the area is nearly 31% higher than the national average cost of living. Housing expenses, in particular, are very high, costing 58% more than the nationwide average cost. Households in the city, with an annual median income of $69,394, are slightly less wealthy than households across the state. A typical home in Danbury is valued at $283,400, slightly higher than Connecticut’s median home value of $267,200.For many Danbury residents, however, the high standard of living may be worth the high cost. Leisure activities are easy to come by in the area. There are around 10 nature parks and 57 marinas per 100,000 area residents, each some of the highest concentrations of such amenities nationwide.
• 1
  Meridian, Idaho > Population: 87,739
  > Median home value: $193,900
  > Poverty rate: 10.9%
  > Pct. with at least a bachelor’s degree: 27.7%
  > Amenities per 100,000 residents: 169.8Meridian, located just outside of Idaho’s capital city of Boise, is 24//7 Wall St.’s best city to live in. The city is safe, and jobs have attracted growing numbers of new residents. Only 80 violent crimes were reported per 100,000 in Meridian last year, a fraction of the national violent crime rate of 366 violent crimes per 100,000 Americans.The annual unemployment rate in the city is also quite low. At just 4.1%, it is lower than the state’s jobless rate of 4.8% and well below the national jobless rate of 6.2%. Moreover, jobs are being added to the local economy faster than in most of the United States. The 7.4% increase in the number of jobs from 2012 through last year was much greater than the national job growth rate of 1.8% over that period. Prospective employment is frequently the first priority for Americans considering relocation. With the strong job market, Meridian’s population has been growing dramatically in recent years. Over the five years through 2014, the city’s population growth rate of 28.0% was more than four times the nationwide population growth of 6.5%.

Volkswagen's Emissions Scandal Just Got So Much Worse

BERLIN (AP) -- Germany's Volkswagen, already reeling from the fallout of cheating on U.S. emissions tests for nitrogen oxide, said Tuesday that an internal investigation has revealed "unexplained inconsistencies" in the carbon dioxide emissions from 800,000 of its vehicles - a development it said could cost the company another 2 billion euros ($2.2 billion).

The investigation was undertaken by the company after the revelations that many of its vehicles had software that allowed them to deceive U.S. nitrogen oxide tests. CEO Matthias Mueller promised Tuesday that Volkswagen "will relentlessly and completely clarify what has happened."

"It is a painful process, but for us there is no alternative," said Mueller, who took over after CEO Martin Winterkorn resigned in September because of the emissions-rigging scandal. "For us, only one thing counts, and that is the truth."

The news is the latest in a string of problems identified with Volkswagen emissions, which have caused share prices to plummet.

In September, the company admitted it had installed software designed to defeat tests for nitrogen oxide emissions for four-cylinder diesel engines on 11 million cars worldwide, including almost 500,000 in the U.S. It has already set aside 6.7 billion euros ($7.4 billion) to cover the costs of recalling those vehicles - and analysts expect the emissions scandal to cost the company much more than that.

That scandal had already widened this week, when the U.S. Environmental Protection Agency said Volkswagen had installed software on thousands of Audi, Porsche and VW cars with six-cylinder diesel engines that allowed them to emit fewer pollutants during tests than in real-world driving. Volkswagen has denied the charge, but faces the prospect of more fines and lost sales. 

It was not immediately clear whether the 800,000 vehicles announced Tuesday with the newly discovered carbon dioxide emission problems were among those already affected. Volkswagen did not identify any models by name.

However, Jeannine Ginivan, spokeswoman for Volkswagen Group of America, said "we are told the issue is not related to the U.S. market."

Volkswagen also did say the 800,000 were "predominantly vehicles with diesel engines," raising the possibility for the first time that some Volkswagens with gasoline-powered motors may also have emissions problems. A VW spokesman did not immediately return a phone call seeking clarification about that.

Volkswagen's board of directors said in a separate statement that they learned of the development "with dismay and concern."

"The board of directors and the committee specially established to investigate will meet soon to discuss further measures and consequences," the board said.

Despite the new issue, the company assured customers that the safety of the vehicles in question "is in no way compromised."

It said Volkswagen "will endeavor to clarify the further course of action as quickly as possible and ensure the correct CO2 classification for the vehicles affected" with the responsible authorities.

In talks with the authorities - whom Volkswagen did not identify - the company said it hoped to come up with a "reliable assessment of the legal, and the subsequent economic consequences, of this not yet fully explained issue."

The news broke after Germany's DAX was closed for the day, but Volkswagen shares ended down 1.51 percent to 111 euros.

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VW's Emissions Cheat Could Kill Upwards Of 59 People In The U.S.

Fifty-nine people in the U.S. will likely die prematurely as a result of the excess emissions allowed by Volkswagen's test-cheating software, according to a new study. If each of the nearly 500,000 offending diesel cars in the U.S. stays on the road, the death count could climb as high as 140.

That's the verdict of researchers at Harvard and the Massachusetts Institute of Technology, who quantified the human health impacts of the excess nitrogen oxide (NOx) emissions from VW vehicles produced between 2008 and 2015. The peer-reviewed study was published Thursday in Environmental Research Letters. 

"We all have risk factors in our lives, and [excess emissions] is another small risk factor," study author Steven Barrett of MIT told Environmental Research Web. "If you take into account the additional risk due to the excess Volkswagen emissions, then roughly 60 people have died or will die early, and on average, a decade or more early."

In the best case scenario, Barrett told HuffPost, Volkswagen would recall and fix every single affected vehicle by December 2016 -- which may be easier said than done.

"A key issue is to find a way to get customers to turn in their cars, as a risk is that some people won't want to do that," Barrett said. That means "a recall may be issued but may not be effective."

A full and successful recall could avoid more than 100 additional early deaths, Barrett said.

The software in question allowed VW's diesel cars to cheat emissions tests and release up to 40 times the amount of NOx, a poisonous gas, legally permitted by the Environmental Protection Agency. Inhaled, NOx can cause and aggravate cardiopulmonary diseases like emphysema and bronchitis, and can exacerbate various other heart problems, according to the EPA.

"Even the small increase in NOx from VW diesel emissions is likely to have worsened pollution along the roadways where they have traveled and affected the lives of hundreds of thousands of people," Dan Greenbaum, president of the Health Effects Institute in Boston, told the Associated Press earlier this month.

"To say millions of people are breathing poor air as the result of that is not off the mark," he added.

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Hip Coffee Chains Are Selling Out, And That's OK

The hot beverage chain Peet's Coffee and Tea announced Friday it will acquire a majority stake in the Chicago coffee roaster Intelligentsia. This is the second acquisition for Peet's this month. On Oct. 6 the California-based company announced its purchase of Portland's Stumptown Coffee Roasters. 

For coffee lovers (or, er, snobs), this is a big deal: It's about whether their favorite local, artisanal roasters will become the next Starbucks now that they've sold out. 

Both Intelligentsia and Stumptown have cult followings. They have very few shops around the U.S. and are concentrated in the hip neighborhoods of urban areas. They are the darling brands of the third-wave coffee movement -- the kinds of places where baristas are knowledgable craftspeople rather than teenagers pushing buttons to make a little extra money. 

Some people are upset that these small, handcrafted-latte-kind-of-places are getting bought by bigger companies. "Please don't lose your soul," one Intelligentsia fan tweeted Friday.

The fact is, though, coffee is a business, and the demand for quality is growing beyond the urban core. (As a self-proclaimed coffee snob, there's nothing worse than traveling outside a major metro area and finding out the only coffee options are Dunkin Donuts and Starbucks.)

Just a few days ago, New York City-based reporter Ben Casselman tweeted that he was surprised to find Intelligentsia in a relatively small Iowa city.

Pour-over Intelligentsia Coffee in Davenport, Iowa. We've got to be nearing peak Portland/Brooklyn-ification of America.

— Ben Casselman (@bencasselman) October 26, 2015

There is a real question if great coffee like this can scale without sacrificing quality. People are starting to bet that it can. Back in June, before the two Peet's acquisitions, another big third-wave coffee favorite, San Francisco's Blue Bottle, announced it raised $70 million in venture funding.

On the other side of the coffee divide, Starbucks is trying to go high-end. It opened its first upscale cafe and roastery in Seattle last year.

The Peet's money will help both Stumptown and Intelligentsia compete with the venture-backed Blue Bottle, and try to stave off Starbucks.

Obviously, things go wrong at big corporations, and plenty could get diluted now that good coffee companies are selling out. But that is not the stated intention. In an interview with coffee culture site Sprudge on Friday, Intelligentsia co-founder Doug Zell said Peet's has promised to let the smaller company keep doing what it's doing:

Nothing about what we do in terms of sourcing direct trade is going to change. As we grow we’re going to continue to buy great coffees from the best producers in the world. We’ll be able to cast a wider net with the muscle and resources of Peet’s.

Let's hope that muscle is used as a force for good (coffee).

REI CEO Says Closing On Black Friday Is A 'Radical Idea'

REI will be sacrificing one of its top business days when it closes its 143 retail stores on Black Friday to encourage customers to spend time outside.

CEO Jerry Stritzke told HuffPost Live on Wednesday that the decision to close up shop for the day wasn't "made lightly," and admits that "it's a bit of a startling idea from a retail perspective."

"[We] certainly had to think hard about it. This is new news. I haven't spoken to very many of my contemporaries about the issue, but I'm excited by the idea," Stritzke said. "I think it's intriguing that we can create this conversation [about] something so central to our brand and kind of who we are."

This is the first time REI will close on Black Friday, even though the day after Thanksgiving has historically been a "top 10 business day" for the company, according to Stritzke. However, the company's decision exemplifies some retailers' recent opposition to keeping stores open on what is traditionally a family holiday, and the day after.

Online shoppers will still be able to purchase items from REI on Black Friday, though they'll initially be directed to a blackout screen imploring them to explore the outdoors. Online sales aren't the initiative's priority, however.

"It's easier to leave [the website] on than turning it off," Stritzke explained.

Watch Jerry Stritzke's conversation with HuffPost Live in the clip above.

Want more HuffPost Live? Stream us anytime on Go90, Verizon's mobile social entertainment network, and listen to our best interviews on iTunes.

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