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"When Rates Really Suck And Drivers Take It On The Chin"

FreightWaves

A conversation about the future of autonomous trucking with pro-labor author and sociologist Steve Viscelli.

Steve Viscelli doesn't think of himself as a naysayer. "I'm more a yes-sayer with a pessimistic outlook," said Viscelli, an economic and political sociologist at the University of Pennsylvania and author of The Big Rig: Trucking & the Decline of the American Dream. 

That book featured some serious, on-the-ground research, with Viscelli driving thousands of miles in a Class 8 truck. He's currently at work on another book about trucking, this time about autonomy and automation.

And yeah, he's pretty pessimistic about the self-driving future, at least when it comes to the likely impacts on drivers.

Automation is deskilling the trucking workforce, he said, and will exert downward pressure on driver wages. Viscelli also called into question the benefits of digital freight matching platforms for independent contractors, arguing that the entrepreneurial benefits won't compensate for the heightened competition.

"The history of the industry suggests really dense markets make the industry super competitive," said Viscelli, whose cheerful tone belied the critique he unspooled during a recent interview with FreightWaves.

"Lots and lots of trucks chasing after relatively few loads means you're going to end up with periods when rates really suck and drivers take it on the chin." 

Viscelli believes the solution to these problems is pretty clear. "There is one basic thing we have to do. We have to put a floor under wages and hours and conditions so that we don't have companies competing on what they pay their drivers for."

He also weighed in on ports as the dystopian precursor to autonomy, the rise of big box retailers and the confluence of e-commerce, technology and contracting. Here are more of his insights (excerpts have been edited for length and clarity):

On the history of trucking automation:

"I would put the modern start at the satellite-linked computers in the original Qualcomm systems that created a platform allowing you to communicate, manage and dispatch drivers who were less and less experienced over time. It's the trucking equivalent of a smartphone — once you have this powerful technology, you can start to think about add-ons or apps."

On driver-assist and collision-avoidance software:

"The immediate benefit is improved safety. But what companies are solving for are the hugely expensive accidents that can cost them upwards of $40 million.

"One of the biggest costs with inexperienced drivers is they are less safe and more likely to get into bad accidents. So if you eliminate those costs, you've made it easier and more profitable for companies to hire really cheap new drivers. That's because don't have to worry about high-speed crashes, so a big part of what you are training for is no longer required."

On the wage impacts of automation:

"The big firms that are big adopters of these technologies are cycling drivers through. So these technologies will most likely decrease wages. That's kind of an odd thing for most people to think about. But ultimately you are deskilling the job."

On skilled vs. unskilled labor:

"We have this twisted way, economists in particular, of thinking about skills. It looks at education and says if you have more years of education, you must be more skilled.

"The idea that drivers are more skilled simply because they are interacting with a computer is looking at it through a flawed lens. The job used to rely on knowledge people built up about traffic patterns, geography, reading a map — actually it's pretty hard for people to do. Now you have people who can't even read a map."

On the possibility of autonomous technology to up-skill drivers:

"It would fly in the face of basically every other technological advance in the industry in decades, which has been deskilling."

On the exception to the rule:

"I have only one scenario where you have significant up-skilling and that's a driver who is a pilot of a number of autonomous trucks in a platoon.

"Say the truck can drive itself, but I'm responsible for deciding whether the truck can drive itself safely under these conditions, whether it's odd light situations, traffic patterns or snow on the ground. For that you need real global understanding of the system and its capabilities. It's like the 737 MAX, where the pilot training is not only could you fly the plane manually should the system fail, but to identify the problems that would happen to the system itself."

On companies investing in training:

"If we're going to up-skill, we're going to have to radically change the model of training and investment that companies do. And the fact is they have shown no willingness to invest in long-term relationships with skilled workers, the few exceptions being UPS Inc (NYSE: UPS) and some of less-than-truckload [LTL] companies."

On the pros of digital freight matching:

"You have a more direct matching system that promotes entrepreneurship. So you can have independents who no longer have to lease on with a [trucking] firm as a contractor or go through expensive brokerages. You can create markets that are denser where independents have more opportunity."

On the cons:

"It's not going to be good for drivers. I'm always the naysayer! The history of the industry suggests really dense markets make the industry super-competitive. Lots and lots of trucks chasing after relatively few loads means you're going to end up with periods when rates really suck and drivers take it on the chin. 

"We can go back to colonial times and that's how local freight markets work. There's just no margin in them. All you need is a truck and a tank of gas, and you can move something, licensing and regulation aside."

On the drayage model:

"So what does that market look like. It looks to me like local ports today. I raise this all the time. I've never had anyone come up with why ports aren't the model for what the markets that are enabled by marketized transactions and platforms would look like.

There's no reason to think otherwise. And that is certainly not where most drivers want to end up in terms of working conditions and wages."

On policy solutions:

"Right now, the two big issues are worker misclassification and the abuse of independent-contractor relationships. So that's number one: These are abusive employment relationships that we need to stop. Two is getting basic accounting of the hours drivers work and that drivers are getting paid for those hours."

On e-commerce and deregulation:

"The big technology changes are happening at the same time we're having some of the most important shifts in consumer demand because of e-commerce that the system has ever seen. It looks like what happened around deregulation, where not only did you have this massive shift in the rules about how trucks are going to move, you also had this tremendous potential demand for big-box supply chain, which was in the formative stages when deregulation happened."

On where we are now:

"We're in this incredible period of uncertainty. It's really historical, and I don't think we've seen anything like this. I try to be careful about prognostics. But. Wow."

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