On December 2, 2021, truck driver John Malozienc inspects an Amazon trailer bound for Tucson at a distribution center in Phoenix, Arizona, USA. REUTERS/Caitlin O'Hara

Reuters, Los Angeles/Chicago, December 8-Amazon (AMZN.O) is trying to recruit large rig contractors to transport goods in its warehouse network, which conflicts with a shortage of truck drivers because the e-commerce company is taking action to anticipate this The number of packages during the holiday will hit a record high.

Its project called Amazon Freight Partners (AFP) recruits independent freight companies to transport goods between Amazon facilities. These companies (or AFPs) are Amazon’s exclusive contractors, and they also deliver packages to or from the fleet of 85 North American aircraft owned or leased by the company.

An Amazon spokesperson said that since 2019, Amazon has recruited 250 AFPs worldwide, enabling these companies to "start and expand their own transportation business and create jobs for thousands of drivers." This freight network - separate from the army of home delivery contractors who put Amazon parcels at shoppers' doorsteps - has allowed small AFPs to engage with Walmart (WMT.N) and United Parcel Service (UPS.N) as fierce drivers. compete.

"There is a shortage of drivers, especially good drivers," said Ebernie McKinley, the owner of the family-run Top Seven Truck Company. This Phoenix area company is one of the first companies to join the AFP program in April 2020. As part of AFP, it now owns 20 Amazon-branded semi-truck tractors and employs 45 drivers.

According to US Department of Transportation data seen by Reuters, Amazon's logistics department has purchased 1,395 Amazon-branded large tractors for towing cargo trailers in the United States. With a record shortage of 80,000 large rig drivers in the industry, independent contractors such as McKinley are responsible for the seats of these vehicles. "Everyone feels the heat," she said.

For large trucking companies, the labor problem is particularly serious because their drivers need more certificates: government agencies require them to have a commercial driver’s license, and insurance companies increasingly need two years of experience. With demand for consumer goods hitting record highs, skilled drivers can move to a new, higher-paying job.

Seattle-based Amazon said in October that higher wages, more incentives for workers, and inflation in services such as trucking led to additional spending of $2 billion in the previous quarter. Amazon expects these costs in the current holiday quarter to double, which may wipe out profits during its largest sales period.

According to the US Bureau of Labor Statistics (BLS), the wages of truck drivers have not kept up with the pace of inflation, and the "real" income is only 70% of what it was in the 1970s. Federal restrictions on daily working hours, the COVID-19 pandemic, and other obstacles have prompted many truck drivers to resign.

At Seven Strong, new drivers start at $22 per hour. The allowance includes a recruitment bonus of $1,500 and overtime pay. According to data from the US Bureau of Labor Statistics, the base salary is roughly the same as the median wage of all American truck drivers, which is $47,130 per year, or $22.66 per hour. Owner McKinley said that Amazon’s payments include driver compensation.

According to Reuters' review of dozens of help-seeking posts on Indeed, ZipRecruiter, and other online sites, AFP across the United States was paid between US$18 and US$27 per hour before advertising benefits and stayed overnight at home. According to the post, signing bonuses range from $1,000 to $2,000.

Amazon told Reuters that it recommends a minimum contract wage for AFP drivers, but it also encourages contractors to pay higher wages to find and retain talent.

Law and trucking experts say that if Amazon regulates the wages of truck drivers, it may violate regulations for independent contractors when certain states want to classify such workers as employees.

Two current Agence France-Presse, who declined to be named due to fear of retaliation, told Reuters that the job was stable and predictable-although they said other inexperienced operators may be overwhelmed by overtime and unexpected expenses.

While the stability and reliability provided by established trucking employers such as Wal-Mart or UPS may attract older and experienced drivers, owners of small trucking companies may be attracted by the opportunity to grow with Amazon.

“Take your wagon on the Amazon train-it’s hard to refuse,” said Peggy Cipron, CEO of TeamOne Logistics. TeamOne Logistics is a third-party logistics company with 700 drivers in 43 states, but Does not cooperate with Amazon.

Amazon predicts net sales in the fourth quarter of 130 to 140 billion U.S. dollars, an increase of 4-12%, which may translate into a surge in the number of packages it handles. Marc Wulfraat, president of consulting firm MVPVL International, said that this year, this could mean that it handled 32 million parcels on peak days in the United States.

Amazon's former transportation partner FedEx (FDX.N) also reported that quarterly profits have been hit due to unexpected costs, mainly from the land transportation department that relies on contract drivers.

Truck driver employers UPS and Wal-Mart were not immune to the pressure, but did not report the same degree of cost problems.

UPS sees Amazon as its largest customer and spends more on its highly paid union labor, which seems to provide labor stability with profit protection.

Walmart has more than 11,000 large rig drivers, and the company said that rising supply chain costs have reduced its US gross profit margin by 12 basis points in its most recent quarter.

Wal-Mart is raising wages and bonuses for its decades-old in-house trucking business, which uses 8,400 owned and leased tractors to deliver goods to more than 5,300 Wal-Mart and Sam's Club stores in the United States. Wal-Mart—which mainly hires long-distance truck drivers—recruits immediate positions for truck drivers. The starting salary is $87,500, excluding the $8,000 or $12,000 signing bonus. A Wal-Mart spokesperson said that the bonus for working an extra day during peak seasons sometimes jumped from US$150 to US$250 per day.

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