Delivery Drivers, Inc., a provider of independent-contractor labor for businesses, is in the process of hiring a huge number of additional drivers to meet the growing demand for last-mile delivery of e-commerce orders. In this conversation with SupplyChainBrain Editor-in-Chief Bob Bowman, DDI Chief Executive Officer Aaron Hageman discusses the challenge of attracting and retaining the necessary workforce during the pandemic and beyond.
SCB: You're planning to hire over 140,000 new drivers in 2021. Where will they come from?
Hageman: Absolutely everywhere in the United States. I think about it two ways. First, geographically. We need drivers in most every major city, and in a lot of rural areas throughout the country as well. The second question is, what type of work are they doing? What sectors are they coming from? We need delivery drivers for grocery, restaurants, pharmaceutical and medical.
SCB: How do you go about attracting them?
Hageman: There are a few main strategies. We do a lot of direct external advertising, and partnerships with some of the big advertisers like Indeed and ZipRecruiter. Additionally, we lean on social media. There's a lot of great technology that finds people who are currently drivers or who fit our profile. Last but not least, we deal with the 1099 [independent contractor] delivery world. We think of drivers who might be delivering with Uber or Lyft and similar programs. In our last survey, 65% of our driver base was working on multiple platforms at once. There are a lot of people out there who are looking to fill in gaps in their current delivery space.
SCB: We're talking about drivers who will be driving smaller vehicles and making local deliveries, right? Not the ones who are going to be behind the wheel of a big rig.
Hageman: In our network, 95% of the jobs are going to be local, available to the average person who has a car and a smartphone. There are some Class A certification and long-haul jobs in certain spaces if people are looking for that type of work, but it's predominantly last-mile local delivery.
SCB: We’re continuing to experience a nationwide driver shortage. To what extent does that extend to the type of workforce you’re looking at? Do you see a potential shortage of the type of driver you need?
Hageman: It’s definitely challenging. This is a very direct supply-and-demand conversation. The entire brick-and-mortar world has been accelerated into the delivery game in the last 18 months, with COVID-19 in particular. So the battle for all types of drivers is definitely out there.
SCB: The long-haul driver workforce tends to skew older. In your area, do the drivers tend to be younger?
Hageman: Interestingly enough, the data supports that it's not just young Generation-Z drivers. The demographics skew well above the average age of 30 in our network right now. There’s a large diversification of people who participate in last-mile driving on a 1099 basis. It's so easy to supplement your income, or do this as your primary source of income, working with multiple apps.
SCB: When you speak of 1099 drivers, does that mean that the actual number of hours they work during a day or week can be highly flexible?
Hageman: That's one of the upsides of being independent. You have the flexibility of working as much or as little as you'd like. And there's plenty of opportunity for full-time drivers. In our recent surveying, we’ve found that right now, 75% of our drivers are working five days a week — effectively on a full-time basis, because there are plenty of jobs and work to be done.
SCB: Is there an additional challenge of attracting these drivers in a time of pandemic?
Hageman: Absolutely. It works very well for the drivers. There's lots of competitive pay, sign-on bonuses, and economic opportunities. There's definitely a need to continue to recruit. We source thousands and thousands of open jobs a week right now.
SCB: Are some good candidates for these jobs reluctant to take them until vaccinations are more prevalent?
Hageman: It’s definitely a concern. The good news is that technology in the last year has quickly pivoted in the delivery world, to allow for both contact and non-contact deliveries. So a driver making grocery deliveries who has concerns about COVID-19 might choose not to deliver alcohol-based products that require an ID and signature.
SCB: What does it take in terms of training to onboard a new hire into your network?
Hageman: For us, we deal very strongly in the 1099 world. There's really no training required for most last-mile-based deliveries. You just need a smartphone and a vehicle, and nine times out of 10 you're going to be able to get working and start making money pretty quickly.
SCB: Do you expect to upscale or downscale the number of your drivers in accordance with seasonal demand patterns?
Hageman: For us at DDI, it's just a matter of moving forward. There’s some seasonality within certain delivery worlds — flowers, for example. But when you get enough different types of deliveries, our drivers stay very busy because they have many opportunities. On the whole, it's just getting busier and busier.
SCB: Assuming the economy is going to recover at some point, and maybe even get back to where it was before, with extremely low unemployment, do you foresee any challenges in attracting and retaining drivers over the long term?
Hageman: If you think back to the driver demographics that I was alluding to earlier, they're not just college kids out there delivering groceries. It’s our friends, neighbors, and former coworkers. As unemployment gets back into line with previous levels, there are going to be people who leave the contingent labor workforce for more permanent jobs. That said, because of the demands of the delivery world, and the shift from a brick-and-mortar-based economy to one focused on e-commerce, the business is going to continue to grow. It will be challenging when there are more employment opportunities all around, but on the whole, there's lots of work out there. We'll keep drivers busy.
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