Freight Transportation Industry Faces Major Challenges In New Year
Freight Transportation Industry Faces Major Challenges In New Year
UNIVERSITY PARK, PA--Now that the Christmas rush for freight traffic is winding down, managers of freight transportation can soon take a break for the Christmas vacation. However, when work begins anew in early January, managers will have a lot to think about.
"High on the list will be figuring out how to make a profit in the post September 11 world. The beefing up of security has led to longer wait times for drivers and other transportation workers. Longer waits reduce productivity for both equipment operators and equipment. Firms must either find ways to increase productivity back to pre-September 11 levels or raise rates," says Peter Swan, assistant professor of business logistics in Penn State's Smeal College of Business.
An additional opportunity will be the eventual introduction of Mexican drivers to the U.S. market. Swan is doubtful that U.S. drivers can compete with their Mexican counterparts on pay. In the long-term, he believes this change could significantly reduce U.S. driver wages.
"What would happen to union firms? If work rules and a shortage of drivers, limit the use of Mexican drivers, how can firms support a labor market that has both high-pay workers and low-pay workers? Will certain regions of the country gain or lose as a result? Will the market for transportation turn into even more of a bidding war than it is today? As a nation, we will need to deal with the issue of Mexican drivers and the issue of pay for transportation workers in general," says Swan, who has researched the effect of pay on driver safety.
While some unionized transportation workers such as pilots and railroad workers enjoy high wages, others such as truck drivers, airline security personnel, and bus drivers have very low rates of pay. The importance of transportation and transportation workers has been shown by the events of September 11.
"When the New Year starts, the transportation industry will have no shortage of challenges. The future of transportation, and the therefore the nation, depends on what we do next," says Swan.
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Editors: Peter Swan is at 814-863-7196 (office) or pfs4@psu.edu . For assistance, contact Steve Infanti of the Smeal College Media Relations' Office at 814-863-3798 or smi3@psu.edu .
Penn State's Smeal College of Business is a pre-eminent learning community, shaping business practice for tomorrow's converging economies. With 5,900 undergraduates, Smeal College has the third largest undergraduate business program in the country. In addition to the nationally ranked undergraduate program, Smeal College is home to internationally ranked MBA and Executive Education Programs. Smeal College's seven academic departments, as well as its ten research centers and institutes, present programs and studies in leading-edge areas such as B2B marketing, supply chain management, e-business, and entrepreneurship along with the traditional areas of marketing, management, finance, real estate, accounting and information systems.
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REPORTERS & EDITORS: For more information, please contact Wyatt DuBois in the Smeal College of Business Media Relations Office at 814-863-3798 or wed112@psu.edu.
Penn State's Smeal College of Business offers highly ranked undergraduate, MBA, executive MBA, Ph.D., and executive education opportunities to more than 5,500 students at all levels. Featuring academic departments of accounting, finance, marketing, insurance and real estate, management, and supply chain and information systems, the college is also home to major research centers such as the Center for Supply Chain Research, the Institute for the Study of Business Markets, the Center for Digital Transformation, the Farrell Center for Corporate Innovation and Entrepreneurship, the Center for Global Business Studies, and the Center for the Management of Technological and Organizational Change.
