The premiere of Canada’s Alberta province on Thursday called on the federal government to halt a COVID-19 vaccine mandate for cross-border truck drivers, which companies say will disrupt the supply chain and boost inflation.
The mandate, imposed by Ottawa to help curb the spread of coronavirus, has cost Canadian trucking companies about 10 percent of their international drivers, six top executives said this week. They said they are raising wages to lure new operators in under the worst labor shortages they have experienced.
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Alberta Premier Jason Kenney called at a press conference in the Calgary government to extend an exemption that had been in place for truck drivers since the start of the pandemic.
Kenney made his request the same day that the United States confirmed that their own vaccine mandate for truckers would begin on Saturday. Canada has been in place since January 15th.
“Common sense tells us we’re on top of supply chain constraints across North America, around the world, huge inflation,” Kenney said.
This is not the time “to potentially lose thousands of truck drivers on our roads, pick up groceries from the US and who knows maybe (COVID) fast test kits too,” he said.
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As many as 32,000 or 20 percent of the 160,000 Canadian and U.S. cross-border truck drivers may be taken off the roads by the mandate, the Canadian Trucking Alliance (CTA) estimates. The industry lacked about 18,000 drivers even before the mandate, the CTA said.
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Prime Minister Justin Trudeau has resisted industry pressure to postpone the mandate since it was first announced in November. On Wednesday, Trudeau defended the mandate, saying Canada was “in line” with the United States, its largest trading partner.
On Thursday, Canada’s Department of Transportation said the measure did not adversely affect the delivery of goods and that cross-border truck traffic had not varied significantly.
Within the next two weeks, consumers will see that “there are not that many choices on the shelves,” said Dan Einwechter, chairman and CEO of Challenger Motor Freight Inc in Cambridge, Ontario.
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“The prices will ultimately be passed on from the sellers of these products because we pass on our increases to them,” he said.
Canada’s inflation rate hit a 30-year high of 4.8% in December, and economists said the vaccine mandate could help keep prices higher for longer. In the United States, inflation rose seven percent year-on-year in December, the largest increase in nearly four decades.
More than two-thirds of the C $ 650 billion ($ 521 billion) in goods traded annually between Canada and the United States travels by road.
Rob Penner, president and CEO of Winnipeg, Manitoba-based Bison Transportation, said from Jan. 1 that it raised the base rate for cross-border drivers by nearly 20 percent, but failed to achieve any.
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“There’s more freight than there are people right now.”
Fresh foods are particularly sensitive to freight problems because they expire quickly, though all imports from the U.S. could be affected, truck executives said.
Canadian companies are seeing labor shortages intensify and wage pressures rising, according to a Bank of Canada survey released on Monday. Investors are increasingly expecting the central bank to raise interest rates next week for the first time since 2018.