The premier of Canada’s Alberta province on Thursday called on the federal government to halt a COVID-19 vaccine mandate for cross-border truck drivers that companies say will disrupt supply chains and fuel inflation.
Six top executives this week said a mandate imposed by Ottawa to help curb the spread of the coronavirus has cost Canadian trucking companies about 10 percent of their international drivers. He said they are raising wages to lure new operators during the worst labor shortage.
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Alberta Premier Jason Kenney urged the government at a news conference in Calgary to expand the exemption that has been in place for truck drivers since the start of the pandemic.
Kenny made his request on the same day that the United States confirmed that its own vaccine limit mandate for truck drivers would begin on Saturday. Canada is in effect from 15 January.
“Common sense tells us that we are at the peak of supply chain bottlenecks in North America, around the world, massive inflation,” Kenney said.
“Who knows, potentially losing thousands of truck drivers on our roads, fetching groceries from the US and maybe (COVID) rapid test kits,” he said.
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The Trucking Alliance of Canada (CTA) estimates that 32,000, or 20 percent, of 160,000 Canadian and US cross-border truck drivers could be taken off the roads by mandate. The CTA said the industry was already short of 18,000 drivers before the mandate.
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Prime Minister Justin Trudeau has resisted industry pressure to delay the mandate since it was first announced in November. On Wednesday, Trudeau defended the mandate, saying Canada was “allied” with the United States, its largest trading partner.
On Thursday, Canada’s Ministry of Transport said the measure was not negatively affecting the supply of goods, and that cross-border truck traffic did not vary significantly.
Within the next two weeks, consumers will see that “there aren’t as many options on the shelf,” said Dan Einwechter, president and chief executive officer of Challenger Motor Freight Inc. in Cambridge, Ontario.
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“Ultimately the prices will be passed on to the sellers of those products as we are paying our hikes on them,” he said.
Canada’s inflation rate hit a 30-year high of 4.8% in December and economists said the vaccine mandate could contribute to keeping prices up for longer. In the United States, inflation rose seven percent year-on-year in December, the biggest increase in nearly four decades.
More than two-thirds of the $650 billion ($521 billion) traded annually between Canada and the United States travels on roads.
Rob Penner, Winnipeg’s president and CEO of Manitoba-based Bison Transport, said starting January 1 it raised the base rate for cross-border drivers by about 20 percent, but failed to achieve any.
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“There’s more freight than people right now.”
Trucking managers said fresh foods are particularly vulnerable to freight problems because they run out rapidly, although all imports from the United States may be affected.
Canadian firms are facing an intensifying labor shortage and increasing wage pressure, according to a Bank of Canada survey released on Monday. Investors expect the central bank to raise interest rates next week for the first time since 2018.