This Is Why the Nation Is Facing a School Bus Driver Shortage

they had a pre pandemic. Yeah, truly, it's been a year of shortages or I guess maybe maybe scarcity is a better way of putting it, both in terms of like the supply chain, which we've spoken a lot about, but also in terms of labor market. So a lot of employers saying that they can't find the right employees, or if they find the right employees, then they don't turn up to actually work, or they're all quitting on

mass to do something else. I have a lot of questions about what else is that other people are actually leaving to do. But that seems to be you know, the anecdotes that we keep hearing over and over from the labor market, right, And it's important to note anecdotes from the employer's side. Obviously the anecdotes from the labor

side might look different. One area that from what I understand, is have uh and we'll get drilled down into specifics, but public sector employment has been tough, and I think a lot of governments to particularly areas where people have pensions that they can retire to and so forth. You know, for a long time post grade financial crisis, the public

sector cut a lot of jobs. But my understanding right now is it's the opposite where the public sector by and large is having a really hard time recruiting, and of course public sector is more limited budget flexibility and so forth then businesses are. But that's a whole area or sub component of the labor market shortage that we haven't really talked about. Yeah, it's kind of an interesting one because is you know, for years, if you worked in the public sector, it was considered a very safe

and stable and to some extent, desirable job. And I have to say I'm kind of speaking slightly from experience here because I just realized my mother worked in the public sector for Austria and she just took early retirement last year. I think there's one of the people that basically like threw her hands up and said, it's not worth it anymore. I'm just going to retire early and avoid all this pandemic related stress and um, you know, take my retirement benefits and and go live my life.

So yeah, Now, of course, when it comes to government, their varying degrees to which the public actually interfaces with the government. But there's no question that for a lot of parents, particularly including myself, over the last two years, one of the big issues has been schools and getting to school, and that is sort of for people, for parents who have children kind of one of the key

ways that they interact with public institutions. And so whether those are functioning, whether AHM staffing, whether they can get the kids to school h H is to what we're talking about. That is a huge way in which these shortages can or again these mismatches perhaps are this scarcity. I keep using shortages even though I really think that's like sort of employers and framing ends up being a

real issue for the for the general public. Yeah. So, the only thing I know about this is basically from your tweets, But there is apparently there is apparently a shortage of school bus drivers, and as you just pointed out, I mean, this is particularly a sensitive issue for parents. And you know, we talk about inflation being painful for people who feel like they're no longer able to feed their families or it's going to cost them a lot

more than it used to. And I feel like you're right, this is probably one area where the labor shortage would

actually be particularly felt by parents. And the question I have is whether or not this is an idiosyncratic development, because maybe there are individual things around the school bus driver market that make it more difficult to hire the right people, or whether this is a reflection of that broader trend that you were just describing of people really, you know, the great resignation that we keep hearing so much about and people just deciding that they don't want

to drive school buses for a living anymore. Well, I'm really excited. We're going to dive right into it. Before I do, I just want to say my daughter, she goes to school very close to our house, as she could walk, but she did go to summer camp on Staten Island uh the summer, so she did have to take a school bus for the first time. So this is an important topic for me, and we have the perfect guest to discuss it. We're gonna be speaking with

Corey Muirhead. He's the executive vice president at Logan Bus Company and Affiliates. It's the largest New York City public school UH bus contractor in the area, has two thousand buses in New York City plus another five on Long Island, and up until very recently, he was the president of the New York School Bus Contractors Association. So we have the perfect guest to talk about what is going on

with school bus drivers. Corey, thank you for coming on outlots Hey, Joe and Tacy, thank you very much for having me. So obviously we're going to talk about the claims that there's a school bus shortage or a driver shortage,

to be more specifically. But before we do, and before we get into current conditions, why do you give us like a brief overview of what a what pre pandemic normal look like in terms of how the market works and how many drivers you employed and how much they're paid, and just sort of like just what what normal looked like pre pandemic. So, pre pandemic people were coming through

the door and they wanted to be hired. One of the things that we see now post pandemic that was still very prevalent pre pandemic, and one of the big things that we're pushing as an industry is no matter what time frame it was, it's always extremely difficult to become a school bus driver. It's one of the most heavily regulated industries and it is a regulatory marathon. But for good reason, right you want to put on the

most professional, expert people drivers that are transporting kids. You know, we're transporting the most precious cargo. So for obvious and for safe reasons, you need to have those regulatory hurdles in order to put the best and brightest on the road. So be that as it may. Back before the pandemic, people were coming through the door, but there was certainly a little bit of a a stagnant, a stagnation happening there. And you know, was it wages? Was it because the

drivers were only getting six hours per pay. A lot of the companies outside of New York City don't offer pensions, and they don't they offer four one ks or the benefits. You know. One of the things that you see there's a dichotomy between New York City and the surrounding areas of Westchester, Long Island, et cetera. Because New York City offers family benefits, full time, forty hour paying jobs with pension,

and a mound in Westchester do not. So you certainly, you certainly saw some people leaving the industry because with everything going on, people were coming into this industry. The pay may have not been as good as other industries, but they were coming because of one the stability of a pension and two because of the family health benefits

that you were able to receive. Now, another big thing about the city and Long Island, and this is what we're all kind of getting together and racking our brains about, is you have a job is like despite being the length of a school year, like a teacher, when the teachers are obviously that are paid than school bus drivers. School bus drivers are paid basically forty weeks out of

fifty two weeks of the year. So if you're looking for a full time job, that's extremely difficult to not be paid for three months out of a twelve month year. So we started to really see people exit the industry

there as well. A lot of times this industry was flooded with retirees because of just the flexibility of the hours, the shortness of the routes, certain things that you were able to do that it was you know a lot of retirees in the NYPD, f D and Y sanitation other second jobs that people would retire forty fifty and then come and drive a school bus because it only took a couple of hours a day for them. That

was all great and well pre pandemic. Now we'll get into why post pandemic that is just completely non existent. But that was the flexibility we had where we had the full time people in the part time people. So can I just press you on this point because I

think it will inform the rest of our discussion. But can you give us, like, you know, if you were trying to sell someone on becoming a school bus driver, what would be the big selling points that you would give them, What is the attraction about the job, and historically what kind of people I realized you just mentioned retirees, but what kind of people would have been most interested in becoming drivers? The people that would be most interested

in becoming drivers are community members. Flex time flexibility, right, So you have people that maybe haven't been in an industry, are are new to entering uh the job workforce, and they say, hey, what can I do that's something around the block or that gives me the flexibility if I have children, I five, if I have other things to do.

So the reason why a lot of people became school bus drivers because you got your job done early in the morning, you have the flexibility to do some of the things in the middle of the day what you needed to do, and then you did the afternoon route and you got to do whatever you need to do at night. As well as being a part of your community, you were around your neighborhood. Many of these school buses, school bus companies facilities are in heavily densely populated neighborhoods,

so a lot of people work walked to work. There's very seldom do I have many drivers that are driving to the facilities. So that was another big, big sticking point. Now once again probably the largest thing, and it with certain companies was the stability of the industry pre pandemic. Our industry is recession proof, but it's not pandemic proof. So what we saw during the Great Financial Crisis back in o eight oh nine we saw we had so many people applying for jobs that there had to be

layoffs and waiting lists. That has completely gone done A one eight. So it's very interesting to see in this life cycle, you know, from two thousand and eight to two one it's uh, it's the complete opposite. But like I said, you had people lining down the block because you were able to do and and as you know, as we get into it there, as you continue to escalate through your years of longevity and tenure, you get paid more. But because of that flexibility, some people do

have second jobs. And when the financial crisis happened, that's what we saw. A lot of people were retirees or people from you know, the finance sector. We're saying, you know what, I need a job. They are hiring, school buses aren't going away. I can do this job in the morning, in the afternoon, and then I could do what I need to do in the middle of the day and at night as well. So that was the

attractiveness of the industry pre pandemic. You know, it's interesting you mentioned regulation, and we have high barriers to entry into space for a very good reason because you know, it's children and it's the same with daycare and childcare. But there's also this tension in childcare and daycare where the very the regulation of childcare facilities is extremely high, but a lot of the people who are in childcare itself,

particularly teachers, aren't paid particularly well. Can you just give it a little more clarity out of sort of like what school bus driver pay grades looked like a normal time. So we'll talk about the greater New York area, and for New York City, it's forty hours paid pay per week, and there's an average between twenty and twenty two dollars per hour. When you get outside to Long Island in Westchester, that average dips down to about eighteen dollars an hour.

There are certain different you know, companies offer different packages. If you don't take benefits, then you can be offered a package as high as twenty five dollars an hour, but then you start to tail that you cut back on the number of hours that you're paid. So many times in Westchester, along Island and even upstate, you'll start to see a five hour guarantee or a six hour guarantee.

And that's really the problem with our industry right now that really needs to be addressed is if you want to attract people, this has to be more of a full time job. That's something that the industry has really it's really shined a light on what's going on right now that no longer do people just want the twenty five dollars an hour for five hours a day. You need to give them a full day's paid work. The

retire re section. That's kind of where that that marriage came from, because these retirees only wanted to work part time or quote unquote part time, and that's non existent as I said before, So you know, it runs the gamut between eighteen dollars and twenty two dollars. There's different types of school buses that we can get into a little bit longer of why other people aren't coming into this industry. As you mentioned before the Great Retirement. There's

type A, which is minivans. These minivans transport special needs education children. And then there's type C, which is your conventional big school bus that you guys see on the road quite often and that transports the general education children. Could you may describe how the contracting system works in New York because I think not a lot of people

will necessarily be familiar with it. But you know, if a district needs school bus drivers, how do they actually go about acquiring those or um, you know, striking a deal with a company that can provide them. So there's two different ways that this industry operates. There's the public sector and the private sector. So let's go micro to macro. New York City is a hundred percent privately contracted. New York State is sixty privately contracted. The nationwide is forty

private contract privately contracted. So the majority of the majority of the nation is publicly contracted, but New York State is majority privately contracted. How you get a private contract or a public contract, so it works two ways. It's an RFP or an RFB, and RFP is a request for proposal and an RFB is a request for bid. The DIP prince between the two is very simple. And RFP has a select criteria of about ten agenda items that you have to master and you get scored based

on that criteria. So it's safety, operational history, insurance, age of vehicle driver abstracts. It's it's a it's a select criteria so that you are you are the most fit and professional operation and obviously prices, of course one of the bigger ones. But there's there's a myriad of different things that you need to score the highest on to

be selected as that vendor. And you are selected by a panel of about three people within the school district or the municipality, and they look at your entire proposal and they say, we deem this operator the most fit operationally financially, and we would like to go ahead with them. On the opposite side of that is what's called a request forbid. A request for bid is very simple. It

is the lowest responsible bidder. So if you bid the lowest number, so long as that district of municipality goes in there and they say, okay, they have the facilities, they have the buses, they have the drivers there will go with them. It's very simple. A lot of the districts, the majority of the districts opt for an RFP because of all of the extra things that you have to put in there. Right, you know, you want a safe, reliable,

good company, You want newer buses on the road. So a lot of people in their RFPs they'll put in we're gonna promise to purchase forty brand new vehicles you know, if you do an RFB, you don't have to put in the age of your fleet. Now, if you're a school district, then you don't want to have fifteen year old buses, dirty diesel buses for every single bus on

the road. No, when you look at that, and as when you're a board of education or superintendent and you're looking at these rfp s and RFPs, you have a fiduciary responsibility to put the safest, most reliable, and also environmentally friendly vehicles on the road. So many oftentimes they opt for an RFP rather than an RFPA. So let

me ask you another question. You as a Logan bus company, your company largest NYC contractor, you have two thousand bus and NYC how do what is the market share of your of those two thousand buses in New York City? And how do market share decisions work? How can they change over time? To what degree do you compete with other operate fleet operators within that our New York City

school bus contractors? So there's very little competition outside of the two bids that went on in two thousand thirteen and two thousand fourteen as far as market share, where about twenty two to fluctuating on how many routes are created each year. And how it works is you you get you pick your routes at the beginning of each year, the d o E and OPT have to route each child, and you know, you have a certain of what's called

restoration rights and you get restored your contract routes. But overall, with including pre K, there's about ten thousands school bus routes in New York City and we operate two thousand. So just you know, for easy context of the market. Now, as far as competition and how we grow and and and you know what, how we scale or things like that, this is an extremely difficult job. It's an extremely difficult industry, I should say job. Excuse me, uh, it's extremely extremely

capital intensive. And a few of the things that are i'd call threats to the industry in terms of businesses staying in business are the cost of vehicles, the cost of real estate, and the cost of insurance. Obviously, because we are school buses transporting children, we have very high levels of insurance, and with high levels of insurance come

high levels of litigation. So many school bus companies have gone out of business or they have was up shop because they could not afford to pay for these expenses. Vehicles are six figures. You know, brand new type C school bus costs about anywhere from a hundred to a hundred and twenty grand, depending on which original equipment manufacturer you're coming with. And then, of course the other thing being who can pay the most for the same pool

of people. We all operate in the five boroughs of New York City, and some of us have the same collective bargaining agreement with unions. Some of us have other unions. But when you are all operating in the same space and you're fighting for the same person, you have to get very creative and crafty on what you're willing to

offer these people. So a lot of the smaller companies, you know, if I were to go and offer an extra five days paid off on top of the New York City five page leave a smaller company that operates a hundred or two hundred busses, it's gonna be very difficult for them to offer an additional five paid days off for a hundred people. That's going to really really

handstring their operations. So that's where we see a lot of companies fold and consolidation of the industry out, whether it be acquisition or for the most part, it's just it's companies throwing in the towel and then the Department of Education distributing the work to the vendors. So this is something that I wanted to ask you based on your previous description of how the contracting process actually works.

But if you're a school bus company, how do you actually make money in this business while providing a sort of economic rate to the people who are buying your services? Because I imagine the ceiling on running a school bus operation could in theory be almost limitless. You know, you could have totally brand new school buses because everyone would love to have their kids driven in a brand new vehicle.

You could have the us possible school bus drivers, people with years and years of experience, because obviously parents would feel more comfortable with that. It feels like the cost could rapidly spiral out of control. But clearly people are in this industry. You have lots of companies competing for these contracts, So how are they actually making money and how do they sort of balance safety with the need for profit. So that's a great question, and it's it's

a very difficult one. So here the couple of easy answers to that, and I say easy facetiously. But the ways that we maintain and mitigate exposure when you talk about being able to turn a profit is you have to stay on top of your insurance and your insurances and safety. So what I mean by that is accident courses to limit the number of vehicles a vehicular accidents you get into so that your order liability claims stay low.

Workers compensation. We have such an extensive workers compensation program because as I'm sure you could imagine, I have two thousand buses employees, we have quite a bit of workers compensation claims. So to stay on top of that program, mitigate the workers compensation claims, mitigate the losses, return to work policies, things like that when you can, when you're able to control and mitigate those type of costs, that

is way to turn profit. You know, you can't sacrifice safety, right, so you still have to put the best, latest and greatest vehicles on the road. But what you can do by that is if you have great credit and you build a grood company, you can leverage debt. So if I'm going to make sure that I pour the money in my company, back into labor and back into and I reinvest into my vehicles. I can, I can buy vehicles at an extremely large number of quantity, and I

could have great rates to buy those vehicles. So that's a great way to leverage debt in our industry is that if you want to have a good, safe operation, you reinvest your money or you use the money that you have to debt to buy debt down on brand new vehicles. And then you know, as far as other things, it's a juggling act between the labor and the number of employees that you have to run your operation. You know, as far as efficiency wise, you really have to end

like operational operational logistics. You have to take a really deep, deep dive and understanding your personnel. How many people, though I do I need to run dispatch to get out a hundred buses? How oh man, it's two? Okay, And that may seem like a lot, but at the very least you need one dispatcher for for every fifty buses. Think about that for a second. This person is responsible for GPS and answering phone calls and making sure that they can get the driver on the radio. So even

fifty fifties a lot. But that's exactly it. So you really have to get down into the leeds, and it's it's more about you don't make money, you don't make more money on each round. You have to find streamlined operational efficiencies in order to make money make more money. So I think we've got a pretty good understanding of like how the market structure generally works in this space. So what don't we now address the so called the

school bus driver shortage? So you talked a little bit about what looked like you said, this is a recession proof industry, but it's not a pandemic proof industry. You said, post GFC you had applications out the door because it was a stable very different today. Why do you talk us about here we are, it's December, what are the new stresses on the running of your business? And what are what are some of the overall numbers of how

how things changed? Sure, so let's go back to March when the entire nation school bus school education system shutdown. Obviously we were low on the picking order, right, Respectfully, I completely understand that. But here's the problem. And as we say, you know, the school bus starts the education process, especially especially in minority neighborhoods and lower income neighborhoods where you see twice as many nearly twice as many people take the school bus to school in those neighborhoods to

get their education. So we weren't being spoken to by the contract The contractors were not being spoken to by the school district. The school districts had a lot on their hands, municipalities had a lot on their hands. But we tried to explain to them, this industry is not just a lights which you don't turn it on and off. These are some of the most heavily regulated and highly licensed individuals in the state. You need to have a plan for us. They didn't have a plan for us.

And what happened was you saw a lot of these CDL drivers say, you know, what the heck is going on with my job? What am I supposed to do? And a lot of the school districts and municipality said, we're not going to pay the school bus contractors because

it would be seen as a gift of public funds. Now, I'm not an attorney, I can't unpack that, but that was that was, you know, a full statement, and what we saw was a lot of these school bus drivers, as they mentioned before, that operating the same communities they live in, the communities they opt rate. They're very upset in the sense that they felt like they're you know, the school districts and the municipalities turned their backs on them.

You know. For me, obviously, we tried to work with the unions to keep them paid for a certain period of time. We tried to keep their benefits for a couple of months and things like that. But when I am receiving zero revenue, I of course had to lay off, lay them off, and you know that keeps you up at night. But concurrently with all of that going on, you hear terrible, terrible stories that the transportation industry was

the second deadliest job during COVID. Even in New York City alone, m t A experienced a hundred and fifty six deaths. Now, the m t A union, one of the m c A unions, is one of the school bus unions. They all speak to each other. So it became a very very difficult job. You were laid off the people who were working, which, by the way, school bus drivers and transit workers are considered essential employees. They

never get the same respect. And I'm not saying that whether they should or not, but they should be at least, you know, acknowledge as essential employees. So you had a really bad perfect storm of you were laid off, you weren't getting paid, the contractors couldn't do anything, and you were hearing about these transportation deaths. And then you were expected to come back that September and you're expected to

drive a school was filled with fifty unvaccinated children. Now, this industry is the median age of a school bus driver is fifty five years old. So this is a pretty old and I say that relatively, this is a pretty old workforce. There was there was quite some fear amongst a lot of people to come back to work. I'm talking back in September twenty now, quite a quite a lot of fear about people coming back to work

transporting children that were unvaccinated. Despite all the measures that we took, whether it was mandating masks, we had, we had cleaning solutions to wipe down the buses, we lost quite a bit of workforce then because of the fear of unvaccinated children. So at the same time, during the pandemic, when school bus drivers weren't working. They still had their CDLs. What was the number one industry that boomed during the pandemic,

truck trucking and delivery. So many drivers went to go work for Amazon and other delivery services because that was pandemic proof. That was a pandemic proof industry. In fact, it skyrocketed to ring the pandemic. So if you are a CDL driver holder, and Amazon warehouses and last mile services are popping up every day in a new neighborhood, whether it's Brooklyn, whether it's Rockaway, whether it's Staten Island, they have all of their bases covered in the five boroughs.

You can walk in there with the CDL and your drug testing and all of your licenses still intact and say, hey, put me on the road immediately. So that further decimated

our industry. Last year, if you remember, in September to June, many of the schools were remote learning, so it was a hybrid x. It was some days in school, some days out of school, and there were quite a bit of problems on how we're going to be paid for that and not from the school districts, And then that trickles down to quite a bit of problems on how you're going to pay your drivers. So how was the driver expected to only work three days out of the week or only work two days out of the week.

Once again, that's strength that strike three, that that once again decimated the industry. So those are the three really big points from school from the school year on why we see today when they said in September, hey, we're going back to a d ready to go fully back in school, and the industry said, whoa hold on. You've been telling you guys for the last eighteen months there's

gonna be an issue here. So two things here, is it possible to give like a rough estimate of how many drivers were lost because they were you know, slightly older retirees who are maybe worried about actually catching COVID versus people who needed money or found better alternatives in the form of Amazon and simply couldn't hang on to the school bus job. And then secondly, I'm assuming that the older generation of bus drivers probably isn't going to

come back into the workforce. Um, correct me if I'm wrong. But on that assumption, where do you start to look for new drivers? So the first part there was about depends nation in statewide, there was a fifteen driver shortage, so you lost you know, if it's the ten thousand in New York City, you lost two people in a New York City does a little bit better because of the things that I spoke about before the forty hours the union that that the health benefits and pension and

things like that. But no, across the state and across the nation you saw about decline. And then to your second point, Yeah, it's a very very very scarce job market because there are no retirees and they're are no older workforce to be here. So some of the creative things that we've been doing is we're trying to you know, hire younger, trying to trying to hire people as a

stepping stone. And you know, whether it be hey, drive a school bus for a couple of years before you get your Class A and go onto trucking, or drive a school bus before you you you do something bigger. Um, it's been it's been a challenge and we're still racking

our brains. There's no right answer here. We're offering sign on bonuses, were increasing our pay something you mentioned before that is really big and something that the whole industry is taking about you know, right now inflation, you know, and we measured in our industry, but just by c p I right now CPI is outpacing e C I and e c I is the employer cost index. So if those increases are if your bottom up there, how

are you expected to hire workforce? How you how am I expected to film my film My void if if inflation is outpacing the the employer uh costs index. So you know, we're really trying to get creative here and think of ways outside of the box to at ract new people. One of the things when I mentioned the younger workforce is once again trying to hit on that flexibility of hours. Hey, if you only want to do a PM route because you don't want to work in

the morning, will take you. I was wondering on that, like, you know, like artists, like any thought of like just like sort of the more classical gig worker types or people who don't want to make it a career but need a little extra money while they pursue their passion. Is that a possible Is that a possible future school bus driver? It is to a certain extent, But this goes back to the difficulty It takes and the longevity

it takes to become a school bush. You know, you have to take five written tests, five written permit tests to pass. You have to take a you know, you have to learn about air breaks, you have to learn about pre inspections, you have to know about transmission and suspensions, uh,

leaf springs. You know, I'm just throwing names out there, like, you know, if you want to if you're a part time person, if you're developing an app, or if you're you're an accountant, or if you're doing something like that, but what are you going to learn about shock absorbers and brake systems? You know, it's a very difficult, difficult, cumbersome process. And then on top of that, you still have to get behind the road and pass your road

test and you need training. It's not like you just get in this car and pass your d m V road tests. No, we do driver's head and then the same thing for school buses. So we're trying, we're trying to figure out ways for people to to think of like hey, we'll do split shifts, we'll do you know,

medical positions and things like that. But no, it's become it's become very difficult so one of the things, um that's obviously happening right now, and I should just include our usual caveat, which is that we are recording this on December six. But clearly there are concerns over the omicron variant of COVID, and we are seeing some you know, additional steps to maybe not go back into full lockdowns.

But people are talking about, you know, more vaccination requirements and perhaps more restrictions on the movement of people and things like that. How do you expect that to impact the school bus driver situation now? And are you worried that it's sort of I guess undoes some of your efforts when it comes to recruiting new drivers. Absolutely, it's extremely extremely im I am extremely extremely nervous, especially if you go into a remote option or if you do

a full lockdown. In both of those scenarios, it's very hard to pay labor because if they're not going to pay the contractors for the days that you are remote, then the contractors can't pay labor. Then they're going to look for other industries where they can continue to work five days a week. You know, as we spoke about before, if you're only working three months nine months out of twelve months, and you have three months off being the

summer and the HOID breaks. You know you're going to continue to further destroy the industry if you don't pay

them for the time off during the remoteness. So all the efforts that we've had paying for training, we've been working with government to make the road tests and the regulatory process more efficient and eliminate some of the unneeded things, and all of these goal, the goodwill and the progress that we've built over the last four months a whole from September December would be destroyed because all of that uncertainty.

Just like how the markets move with on the kron the job markets going to move if if they if they see the writing on the wall is that there's going to be a shutdown, They're going to look for businesses that do not shut down when school shutdown. So I want to get your take, UM. I think in the September Governor Hocoll announced these plans to ease the school bus driver shortage somewhat perhaps streamline the efficiency of

the CDL system. Can you talk about have you seen any effect of those UM proposals and what more could the city or states or municipalities be doing to continue to ease some of the stress you're facing. That's a great question and that that's once again a lot to unpack, so let me try and address all of that. We worked with Governor Hopele's office there. They were great. Sometimes when you work with government, I'm sure you guys know this, they write down notes and then nothing comes of it

with respectfully and it's art because it's difficult. They have to hear from every industry in every sector, and they don't know what is right what is wrong, and they take it with a grain of salt, but knock her off as they did great. So we had meetings and we had conference goals with them, and here are a couple of things that that that they did really that really helped our industry. As you guys remember, uh federal unemployment stimulus packages where people were staying home in New

York State. They're making about nine hundred dollars a day, I believe, or maybe a little bit less than that. It didn't end until September six, by the way, trying to hire people when you were already making nine hundred dollars for September first rollout for schools. That was another very difficult task, right, you know, if you're already sitting home making nine an hour, why are you going to come in and drive a school bus at six am

for you know, the same pay. So with that being said, when we spoke to the Governor's office, we explained to them that it's very difficult to have people come in the door when we have all of our people who are still sitting home on unemployment and the benefits haven't exhausted, but we know that there's a lot more CDL people. So one of the biggest things that she did is she released a survey with about three thousand responses of CDL workers that were on the sidelines, will call it

on unemployment to come back to work. And she said, hey, look at your local school buses. They're offering sign on bonuses, they have new pay packages. Are you interested in driving for a district or for a private contractor? And the responses were overwhelming. There was three thousand responses, and they released the data to all of us and we were able to call these people and get them pluck them off the list to come work for us. That was

extremely extremely helpful. The other thing that was extremely helpful. Has we've spoken about quite a bit is the time it takes to become a driver. It takes anywhere between sixteen and twenty two business days to become a driver. Now that's very, very difficult, and I should say it could take even longer than that. If you need a job immediately, the last thing that you want to do is wait three, four or five weeks to get put on the road unpaid. So that's always been a problem

with our industry. And the Governor's office recognized that and they said, hey, that's that's not right, that's that's really tough. So what they did is they suspended the two weeks between the written tests and the road test. That if you were ready, if you passed all of your written permit tests and you were ready for a road test, you could schedule that immediately and you could get on

the road. Now, another thing like any other industry, And as you alluded to at the beginning of this podcast, you know, government was short staff during the pandemic also, so d m V had less people working the road tests. So so times you can have all of your licenses in place, your drug testing, fingerprinting, everything done and then it would still take four weeks to schedule yourself a

road test. Now, when they heard that, they said, oh my god, that's really terrible because not only did you take the three weeks to get all of your things done to become a driver, but now you have to wait on the government four weeks to take your road test to become licensed. So she put on more DMV inspectors and and and test instructors, and that really helped

us as well. So after that happened, we certainly saw a good number of people come into this industry and we were very very thankful that we had an ear because the previous administration, I'm not going to get political, Uh, the previous administration completely tuned us out. So this kind of leads into a slightly philosophical question that I want

to ask you. But you know, if if we all decide that school bus drivers are are a value part of the labor force, essential workers, what are the chances that governments actually start paying them more or you know, start paying more for contracts and then the contractors can actually pay school bus drivers more. Like is that the natural solution to this is just to pay them more? And if so, why isn't that happening, or what are

the obstacles to that happening. I think that's a loaded question. Sorry, it's okay, No, it's great. I understand you're saying. I think it's difficult. I think get in good faith. Yeah, I know, I know that. I'll say this though. The public companies, the public school districts, excuse me, do quite often pay more than the private contractors to a certain extent, and they're still having an extremely difficult job of hiring people. So I don't know if money is just the answer.

And I think it's because of the type of job it is. And I think that the workforce right now because there are other jobs out there that and you you know, you said that else the other thing at the beginning. I think that the other jobs out there are more enticing to the new workforce. I don't think people want to wake up at five o'clock in the morning and hop on a school bus and transport unvaccinated

children right now. I think that that looks like a difficult job for them when they can work for Amazon or work for other delivery companies and they can wake up at eight o'clock, nine o'clock. Um. Obviously, there's some other things with the federal with the New York state marijuana legislation in that pass that we lost some of our people as well. You know, not to speak on Amazon, but Amazon doesn't you know, in delivery services, they don't

drug test. Obviously, school buses, of course we're going to drug test. It's we're governed by the Federal Motor Clearing Safety Administration and it's not federally regulated, so they have to make sure that they're still not smoking marijuana. So I think you lost people there as well. The younger work for is going to tail off to more jobs that do not drug test to a certain extent. So you know, I'm not sure it's just pay. Obviously, pay

needs needs to needs to be looked at. And let me just one more question on pay though, and all your other points make a lot of sense. You know, you know, a company like Amazon, though, like they could announce tomorrow that every one of their um, every one of their warehouse and logistics workers get to two dollars more proper. I don't know if they would, but obviously they could do that unilaterally. To what extent are your

revenues fixed? And how long did the contracts last with the municipalities, and what kind of flexibility is there in terms of repricing those contracts from your perspective, as the labor market reprices. So the contracts are extremely fixed. But for the most part, you by New York State education law, a contract can go no longer than five years. So

five year extension is the is the maximum. And what would happen if you wanted to give our industry, if you wanted to give a two dollar raise, you have to go what we call quote unquote go out to bid. So what go out to bid means is you, you know, you tell the municipality the contract numbers no longer work. We would like to go out to bid and try and get our numbers. And then you you, you go out, you put pen to paper and you put in a new number. Now, obviously you know the contract. The school

districts look at all the bids that come in. They once again have to find the safest, most reliable, fiscally responsible bus company. But but you know that's the competition. So a lot of times, I certainly do think you see more activity in the bid space now more than ever. So sure, and I think that that's where this industry is going. Is that you'll continue to see and it's healthy competition. But there is still very extremely uh, there is still huge barriers to entry for any new existing

bus company to come in. But that's what's going to have to happen. Contractors are going to have to bid out their work and get their numbers up and then enforced that of course, must go back down to giving increases to labor. One other thing I'll say, by the way, and some of the other contractors will get mad at me for saying this, but I already do it. So I'll say here all the things you're not supposed to say. It has to be an eight hour job. It can't

be five hours, you can't be six hours. The retiree pipeline is no longer there. You have if you're only working ten months out of the twelve months, you have to give them the full eight hour job so that people can see it as a forty hour work week and a full time job. If you when you start to get to those levels, I think you'll see even

more people come into this industry. It's kind of interesting because we're told over and over again by other types of employers that the younger workforce is looking for flexibility, and you know, they want to be able to work from home or they want to be able to dictate their own working hours. But you're sort of advocating going in the office directions. Well, unfortunately for us, we don't

have that flexibility. Right school buses operate at six in the morning and two in the afternoon, So whoever wants to come into the industry, it's the school bell times aren't going to change. So let me just ask you

one last question before we go. So right now, you know, one of the things that strikes me about school buses and schools in general, and I mentioned this in the intros, it's one of the most clear ways that parents are people interact with their government, especially if their kids are in public school. Um, but it's a clear it's a service that people expect. What is the quality of service right now? Have there are the fewer routes being run?

Have you to consolidate routes? Do parents need to take their kids further from their front door to find a bus route? Like? What is the current level of adjustment that's been required because of the difficulty and high Sure, So the contractors and municipalities and school districts have really worked together well. But there is still some pain points that are being filled. Uh. There are certainly less routes being run what will we'll call them, uh, multiple routes

being ran on the same bus. You know that some kids, some kids are are not taking the bus any longer. So you have that flexibility. But say you have a middle school on a high school. One of the bell times is eight o'clock, the other one is eight thirty. You'll put both of those groups of kids on the same bus and you'll do that route back to back. So that consolidation of route has been helpful. Now the only reason you're able to do that is because it's

not at full capacity. But some of the times the routes still do run late. Um. You do not have that flexibility on special education routes. Special education routes they go all over and you can't double up what I'll called double putting two routes on one. So you know, other things are Obviously home to school is the most important thing. The school bus starts the education process. So we've worked with the athletics departments and the athletic conferences

in the state to explain. You know, hey, we have to make sure that we do our routes, get the kids back home from school, and then we'll do the athletics. So whereas athletics used to start at three o'clock three thirty, they're starting at four o'clock now, and that's been a big help because, um, you know, it's one of the things that people understand, understand, it's one of the few things that even the parents understand. You know, it's more important.

It's more important to get the kids home from school right now than to get the kids to to practice, which, by the way, I play I too, season athlete. I completely understand. It stinks. It's a very unfortunate situation right now, but that's the type of creativity we need to get everybody to and from school right now. Well, Corey, that was fantastic. I learned a lot from that. Coremere ahead of the Logan Bus Company. Thank you so much for coming on odd Locks. Thank you both very much. This

was great. Yeah, it's so good. Thank you, Tracy. I really like that episode. And you know, I like all of our episodes where we go like deep into something. But now I kind of want to do more things related to public sector provisioning because it's like it's a whole different world, or thinking about business reality is and things like how ur fps are done and r f b s and all that stuff and listening to Corey

explaining all is U super educational. Yeah, And I mean I think it fits in with the broader theme of Outlots over the past year or so, which has been this idea that you know, we're talking supply chains, We're talking all these invisible processes that you don't normally think about and suddenly in one you actually have to think about them. And that you know, includes things like where

do school bus drivers come from? And where do we get more of them when an entire generation of older driver decides that it's not really worth the time or the risk anymore. The other thing, and you know, thinking about future Odd Lots episodes is like the Amazon effect on the labor market overall, because I really think like that's its own fascinating story essentially, Like you can make the argument like Jeff Bezos, but did he returned? He's

not the CEO. Whoever the CEO of Amazon is at any given moment, is like our de facto minimum wage center right now in America because there's so many warehouses all over the country. They have such a large footprint, and as soon as they set up shop in an area, as Corey said, like for a lot of his employees, it may just make more sense to work at Amazon.

And when you know, I didn't think about it. You know, when you think about the conditions of last September, especially before the vaccine, You're on a bus getting up on you know, bus full of unvaccinated children, your school bus drivers, uh, typically on the older end. And suddenly the just competition from other areas. You can see why even pay us side, you could see why other other types of job has become more appealing. And then you have this veheman Amazon

that just growing and growing and growing. Yeah, and I mean minimum wage that is a great way to put it. And you kind of wonder what the response from the government is going to be, right because you think of Amazon, and normally people think about it in the context of taking potential workers away from private businesses or crowding out some sort of private business, and you don't necessarily think about it crowding out public services. But in this particular case,

that's exactly what what it's been doing. Yeah, no, totally. And you know, I hadn't thought like his point about hybrid two days on, three days off, and how maybe that might have worked for the teachers, but it was very unrealistic for school bus drivers like slash all their routes, and there very so many interesting things like yeah, I guess it just goes back to so many interesting things

I had never thought about. I mean, part of me also just continues to be stunned by like the lack of a social safety net or job security in the States, and the fact that school bus drivers seem to be at will employees, and even though they might have expected to drive school buses every day for a school year, the pandemic happens and suddenly it's like, oh no, we don't need you anymore, so goodbye, you're out of work. That's kind of stunning and unfortunately different to the way

some other countries would do this. Yeah. Pretty uh, pretty fascinating lens into how things actually work. All right, should we leave it there? Let's leave it there. This has been another episode of the All Thoughts podcast. I'm Tracy Alloway. You can follow me on Twitter at Tracy Alloway. And I'm Joe Wisenthal. You can follow me on Twitter at The Stalwart. Follow our producer Laura Carlson. She's at Laura M. Carlson.

Follow the Bloomberg head of podcast Francesco Leavi at Francesca Today, and check out all of our podcasts at Bloomberg under the handle at podcasts. Thanks for listening to