Transportation
The transportation industry is enormous, encompassing everything from
municipal bus, subway, and commuter-train systems that get folks to and
from work and school to the container ships that transport goods from port
to port all around the globe; from the rail and trucking networks that move
those containers across states, countries, and continents to the airliners
we use to fly to destinations near and far for work and pleasure, to the
express shipping companies "for when it absolutely, positively has to
be there overnight."
The industry encompasses all those businesses that move people or goods, by
land, sea, or air, from one point to another. This is a big industry,
employing millions: In addition to the package deliverer, truck driver, and
airline attendant—the ambassadors of the industry—there's a beehive of
behind-the-scenes workers bustling to load containers, fuel airplanes,
coordinate the logistics of thousands of railroad cars, and chart the best
routes for truck drivers to take across America.
Virtually everything that surrounds us—including our clothes—comes from
somewhere else. Your computer's components, manufactured in multiple
countries, all had to be transported to the computer manufacturer,
assembled, and then transported to a store or perhaps your front door. The
newspaper you read this morning could not have been produced (think of the
trucks delivering logs to the paper mill; think of the paper and ink being
delivered to the printing press) or delivered without the transportation
industry. And then there's passenger travel—the airlines, trains,
boats, and buses that people use every day to get from place to place.
Transportation may not be sexy, but it pervades nearly every area of our
lives. Without the transportation industry, economies, global and domestic,
would disintegrate.
Opportunities in the industry can be classified geographically, as local,
regional, national, or international. In many career paths, you'll need
to pay your dues in a local job before moving up to a regional
transportation outfit, and you'll have to work at a regional one before
moving to a national one. And if you go into freight transportation, be
aware that this sector has been consolidating, as companies seek to become
global players by merging into giant, full-service transportation
integrators, combining ships, trains, boats, and rail.
Hard Times for Airlines
The airline industry has taken a series of body blows in recent years.
First there was 9/11, which resulted in a year or two of reduced numbers of
passengers, as well as new costs associated with beefed-up airline security
requirements. Then there's been the increase in fuel prices, punctuated
most recently by a spike in prices in the wake of 2005's Hurricane
Katrina. And through it all, airliners, like companies in all industries in
the U.S., have been faced with higher and higher health care costs for
employees. The consequences have included lots of strife between labor and
management, as workers fight to keep the benefits they believe they've
earned while management struggles to cut costs and make their airlines
profitable. Ask any insider, and he or she will tell you: The airline
industry has been an ugly mess of late. Indeed, US Airways, UAL (which owns
United), Delta, and Northwest all either are currently operating under
bankruptcy protection or have done so in recent years.
That's not to say that there haven't been any bright spots in the
airline industry in recent years. Low-cost carriers Southwest and JetBlue,
which keep costs low by offering only bare-bones services, have far
outperformed big airlines with more august histories. Some of the bigger
airlines have tried to follow their lead by launching low-cost
subsidiaries, but these have typically run into problems as many have
tended to cannibalize existing offerings.
Consolidation
As in many industries, many of the big players in transportation have been
looking to get bigger in recent years, with an eye on lowering costs
through economies of scale, among other things. Indeed, in the recent past,
AMR (owner of American Air Lines) has absorbed TWA; US Airways has merged
with America West; Deutsche Bahn has acquired Bax Global; Canadian National
has merged with British Columbia Rail; DHL has acquired Airborne; Exel has
been acquired by Deutsche Post; and AP Møller-Mærsk has acquired Royal
P&O Nedlloyd.
"Just-in-Time" Technology
Just-in-time technology allows businesses to avoid inventory costs by
procuring goods only when they're needed. Take PC manufacturers like
Dell or Gateway, which promise rapid delivery. Rather than gathering all of
the parts necessary to make a PC, assembling all those parts, and storing
the PC in inventory—tying up money that could be used for other purposes
before anyone’s actually purchased the PC, and increasing costs due to
inventory maintenance—just-in-time technology allows PC manufacturers to
order PC components, have the components delivered, have the components
assembled into a PC, and ship the PC to the customer in a matter of hours.
The freight transportation industry has earned new relevance thanks to its
implementation of just-in-time technology.
RFID Technology
Radio frequency identification technology, or RFID, promises to be a
transforming technology for supply chain management and the transportation
industry. RFID is a system of tags (small chips embedded in products) and
readers that decode information. In RFID, a tag is encoded with information
about a product. As a reader passes by a tag, it emits a radio signal that
stimulates the tag and momentarily powers it, allowing it to send back
data. A reader can also update a tag with information. Similar technology
is used in E-ZPass and FasTrak cards and readers in toll booths on the
East and West Coasts. The potential uses for supply chain management
include providing increased information about freight shipments, auditing
of shipments through the supply chain by automatically adding data to a
card every time it is read, and eventually supplying data to allow
transportation and logistics companies to more efficiently map shipping
schedules to the inventory needs of the retailers or manufacturers at the
end of the supply chain.
There are two sides of the transportation industry: companies that move
goods (freight and shipping companies) and companies that move people
(passenger transportation companies). The biggest of the shipping companies
are the ones that integrate several types of transportation services to
offer clients efficient door-to-door service, thanks to just-in-time
technology and containers that allow goods to be transferred seamlessly
from ships to railroads to trucks. (This is called "intermodal"
transport.)
Here's how the two sides of the transportation industry look when
broken down by the type of vehicle used:
Plane
The biggest shipping players in this segment—FDX Corporation (FedEx), DHL,
and UPS—integrate air transportation with other types of transportation.
On the passenger side, the airline industry has consolidated in the years
since it was deregulated in 1978. American Airlines, Continental Airlines,
Delta Airlines, Northwest Airlines, and United Airlines earn more than half
of U.S. airline revenue. The remainder of this sector comprises regional
carriers, which fly people between rural areas and bigger airports, and
low-cost carriers, like Southwest and JetBlue, which are faring much better
than the big passenger airlines when it comes to the bottom line—and are a
big reason for the major carriers' recent financial woes.
Ship
About three quarters of all maritime shipping is transoceanic, including
tankers that mostly carry petroleum. The biggest shipping companies are
based outside the United States: Taiwan's Evergreen Marine, Japan's
Nippon Yusen Kabushiki Kaisha, and Denmark's AP Møller-Mærsk move
enormous numbers of containers. Although the federal government is
revitalizing U.S. performance in this segment through the use of advanced
technology, job opportunities are generally better at the foreign
companies.
Passenger transportation, which accounts for less than 5 percent of total
water transportation revenue, includes ferries and cruise liners. Carnival
is easily the biggest cruise company in the world. The ferry business is
not as consolidated as the cruise business, with most companies owned
regionally. Both businesses are predicted to grow slowly in coming years.
Truck and Bus
The trucking industry carries 80 percent of all consumer goods. The biggest
players in this segment are integrated-transportation parcel-delivery
companies such as United Parcel Services (UPS), FDX Corporation, and DHL.
The sector includes trucking companies like Schneider National and Yellow
Roadway Corporation, as well as truck rental companies like Amerco (best
known for its U-Haul trucks).
On the passenger side, the biggest bus company in the United States is
Greyhound, which also offers express package delivery.
Rail
Freight trains mainly carry coal, grain, and lumber. After a period of
intense consolidation in this segment, the four leading companies are
Burlington Northern Santa Fe, CSX, Norfolk Southern, and Union Pacific.
Passenger rail transportation in the United States is dominated by the
federally funded Amtrak, which makes stops in 45 states. Amtrak has long
been a financial black hole, and is in danger of losing funding and ceasing
to exist.
Logistics
At the most basic level, the logistics sector of the transportation
industry makes sure the trains run on time. Logistics professionals make
sure people and freight get from place to place when they’re supposed
to—and that they don't hold up the next leg of the trip that's
waiting on their arrival (e.g. that airline passengers changing planes at
airline hubs arrive on time to catch their connecting flights, or that the
ocean freight shipment arrives in port in time to be transferred to the
railway that's going to move it across the country before the train is
scheduled to depart). Most big transportation companies have significant
logistics departments to oversee these matters, but there are a number of
sizeable companies that don't own the ships and trucks and other means
of transportation, but rather just handle the logistics details for the
companies that do.
Examples of these kinds of companies include C.H. Robinson Worldwide and
Expeditors International of Washington. Other companies that contract to
handle logistics for transportation companies include Kuehne & Nagel
International, Schneider Logistics, and DHL Worldwide. Other players in
this sector also include warehousing companies, such as Preferred Freezer
Services, which provide warehousing services for transportation companies.
This is an industry that employs some 10 million people in the United
States. If you want to hop aboard, however, you'll want to keep some
things in mind.
Be aware that for many positions, you'll need to join a union—and in
recent years, strikes and other labor disputes have been a part of life in
the industry (just ask UPS, Northwest, American Airlines, and workers and
management at U.S. ports). Old-line airlines, in particular, have been
putting downward pressure on jobs as they try to fend off or emerge from
bankruptcy.
Job seekers interested in having direct contact with cargo and vehicles
should think about taking jobs in operations, which are often set outdoors
and can involve loud noise and physically strenuous work—for example,
loading or unloading boats or trains.
Logistics, which involves planning and managing efficient transportation
for everything from individual shipments (such as a book from your favorite
e-commerce site) to entire fleets of trucks or planes (think: planning when
and where the planes in FedEx’s fleet will take off and land), has been
growing in recent years as information technology advances have swept the
industry. Today, it's possible to track shipments by satellite and thus
improve the efficiency of the transportation and shipment process, and
ongoing advances in technology should make this an area of strong job
growth.
In the air transport sector, the globalization of business and the fact
that waves of Baby Boomers are starting to retire from the workforce (many
with healthy retirement accounts) both point to growth in the future, even
if consumer airlines are struggling currently in response to terrorist
threats. Opportunities should be plentiful for flight attendants and
aircraft and avionics technicians. Jobs for pilots, on the other hand, are
expected to be difficult to get in coming years.
Overall, there should be weak growth in coming years in opportunities for
travel agents ( online ticket purchases are here to stay), but
solid-to-excellent growth for air traffic controllers, ticket and
reservation agents, and the likes, as well as for people in rail, trucking,
and water transportation. And right now's a good time to get a job in
the industry, as transportation companies are emerging from the bottom of a
business cycle, along with the rest of the economy, and beginning to hire
new workers.
On a macro level, the U.S. Bureau of Labor Statistics expects the number of
jobs in the air transportation sector to grow at a slower rate than the
rate of overall job growth between 2004 and 2014, while it projects that
the number of jobs in the truck transportation and warehousing sector will
grow at about the same rate as jobs overall during that time.
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Smells like Team Spirit
As in many other industries, the network of coworkers you develop in
transportation will not only be important for your success, it'll be
what makes the work fun. But transportation differs from some other
industries in that there's very little snobbishness among the people in
it. An insider says, "We help each other, wherever we are. This makes
work easier and more enjoyable."
The Power of Technology
Technology has changed the face of the transportation industry. If
you're in logistics, for instance, expect to work with 3-D graphics or
special software to help you arrange the placement of billions of tons of
freight onboard a ship, or plan global shipping routes, or monitor
shipments by satellite. An insider describes the innovative technology as
"awesome," adding, "There are so many cutting-edge tools
being developed every day to enhance tracking performance that it's a
great challenge to be working with them."
Join the Industry, See the World
As you might expect, opportunities to see the world abound in this
industry. If you steer the plane, train, or ship, or if you assist on
board, you'll definitely get to see new places. As an added bonus,
family members can come with you or do their own traveling—for free.
The Hours
This is a 24/7 industry; as a result, the work can be unusually strenuous.
People at the corporate level talk of 12-hour days that keep them in the
office until late at night, while people in operations highlight the stress
of working night shifts. "I hate the hours," says one insider who
otherwise likes his job. If you like to keep vampire's hours, this
industry might be the perfect place for you; if you find yourself nodding
off at 10:00 every night, it most likely isn't.
Tons of Pressure
Managing huge operations, solving problems on short notice,
multitasking—this typical transportation industry job description may
appeal to some, but sound like a nightmare to others. Deadlines in
transportation come fast and are inflexible, and the pressure to meet them
can seem huge—you're dealing with millions of dollars in cargo or
cranky passengers who needed to be in Des Moines three hours ago.
"There are so many things to do that sometimes I get on the verge of
losing my cool," says an insider.
Join the Industry, See a Blur
Although insiders in this industry usually think the travel's great,
there are times when they're more likely to hate it. Often, people in
the transportation industry are moving around too much and too fast to
really see any of the new places they visit. Some find too much travel
positively depressing. "I wouldn't want to be on the road all the
time anymore," says one insider. "You're away from your
family and friends too much of the time."
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|
Top 25 Major Players, by 2005 Revenue
|
|
Rank
|
Company
|
Revenue ($M)
|
1-Year Change (%)
|
Employees
|
|
1
|
United Parcel Service
|
42,581
|
16.4
|
407,000
|
|
2
|
DHL Worldwide
|
33,524*
|
21.6*
|
171,980*
|
|
3
|
A. P. Møller-Mærsk A/S
|
30,421*
|
14.8*
|
62,300*
|
|
4
|
FedEx Corp.
|
29,363
|
18.8
|
250,000
|
|
5
|
AMR Corp.
|
20,712
|
11.1
|
92,100
|
|
6
|
Cendant Corp.
|
18,236
|
-7,8
|
85,110
|
|
7
|
UAL Corp.
|
16,391*
|
19.4*
|
61,000*
|
|
8
|
Delta Air Lines
|
16,191
|
7.9
|
55,700
|
|
9
|
Union Pacific Corp.
|
13,578
|
11.2
|
48,000
|
|
10
|
Burlington Northern Santa Fe Corp.
|
12,987
|
18.6
|
38,000
|
|
11
|
Northwest Airlines Corp.
|
11,279*
|
18.6*
|
39,342*
|
|
12
|
Continental Airlines, Inc.
|
11,208
|
15.0
|
42,200
|
|
13
|
YRC Worldwide
|
8,742
|
29.2
|
50,000
|
|
14
|
Norfolk Southern Corp.
|
8,527
|
16.6
|
28,475
|
|
15
|
CSX Corp.
|
8,618
|
7.5
|
35,847
|
|
16
|
Enterprise Rent-a-Car Co.
|
8,230
|
11.2
|
61,000
|
|
17
|
Southwest Airlines
|
7,584
|
16.1
|
30,974
|
|
18
|
Hertz Corp.
|
6,676*
|
28.2*
|
31,400*
|
|
19
|
Ryder System, Inc.
|
5,741
|
11.5
|
26,300
|
|
20
|
C. H. Robinson Worldwide
|
5,689
|
31.0
|
4,174
|
|
21
|
Con-Way Inc.
|
4,170
|
12.3
|
20,100
|
|
22
|
SIRVA, Inc.
|
3,470
|
47.7
|
7,580
|
|
23
|
Schneider National, Inc.
|
3,200*
|
10.3*
|
20,000*
|
|
24
|
Swift Transportation Co., Inc.
|
3,198
|
13.1
|
21,000
|
|
25
|
J. B. Hunt
|
3,128
|
12.3
|
15,850
|
*2004 figures.
Sources: Fortune 500; Hoover's; WetFeet analysis.
|
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Opportunities in transportation generally fall into the following six
categories:
Sales
Sales representatives work closely with clients that have something to
transport. They spend a lot of time visiting clients, developing
relationships, quoting prices, and working with their company's pricing
department to determine fees for deliveries based on weight, volume, and
delivery time. Charisma and confidence are more important in sales
positions than a college degree. Salary range: $25,000 to $75,000 or more,
depending on commissions.
Documentation
People in these positions work on pricing and rating. Pricing personnel
determine the rates clients will pay, which vary based on the weight and
volume of freight, transit time, and other factors. The rating department
steps in once goods reach their destination; rating department personnel
deal with bills of lading—final computation of the price charged to
clients. Documentation personnel working with international accounts also
deal with customs-related issues. Entry-level documentation positions
require a college degree. Salary range: $20,000 to $90,000.
Information Technology
Jobs in IT involve database management, the development and maintenance of
warehouse systems, and supply chain management. Many companies outsource
the management of their IT systems, so these jobs aren't always
technically within the transportation industry. IT work requires a strong
background in programming; a degree in computer science is often a
requirement. Salary range: $35,000 to $100,000 or more.
Logistics
Logistics personnel manage the movement of people and goods—they make sure
the plains and trains arrive and leave on time. At the field level,
dispatchers schedule pick-ups and deliveries. In more strategy-intensive
positions, logistics people use computer systems to track shipments around
the globe or to limit the amount of time products stay in warehouses or
distribution centers. Jobs in logistics generally require a college degree
or military experience; some positions require an MBA. Salary range:
$40,000 to $90,000.
Marketing
People in marketing promote their company to current and potential clients
and investors. Most often, marketers cite either the efficiencies their
company can bring to shipping processes or their lower prices. An insider
stresses the importance of imagination, strategic thinking, and keen
perception for people in these jobs. A college degree is required, as is a
marketing portfolio. Salary range: $30,000 to $100,000 or more.
Driving and Piloting
People in these positions do everything from driving a UPS truck or an
18-wheeler to piloting a train, boat, or airplane. Truck drivers and bus
drivers need a commercial driving license (CDL), which can take a few weeks
to obtain, while pilots require a commercial pilot license (CPL), which can
take up to three years to get. Train engineers usually start as yard crew,
then work for at least ten years before driving a train. Although truck and
bus drivers usually work alone, ship captains and plane pilots generally
require assistance from at least one other person. Salary range: $20,000 to
$120,000 or more.
There are a lot of different people doing a lot of different jobs in
transportation, so qualifications for entry-level positions vary. In
general, even though training programs exist at all levels, the more
advanced positions nearly always require an MBA or prior experience in the
field. Many insiders say that sales is the quickest way into
transportation—once you’re in the industry, it's possible to jump from
one career track to another. Whatever job you're looking for, expect to
start in the field—at the local level—and keep the following in mind:
-
Research the company you're applying to and its competitors. It will
impress an interviewer if you demonstrate knowledge about the company and
how it's different from others.
-
If you want a job in marketing, learn how the company presents itself to
its clients and what strengths it emphasizes by studying its marketing
collateral, then prepare a portfolio that shows how you would sell the
company's strengths to potential clients and investors.
-
Understand the basic measurements used in logistics, and have a good
grasp of geography.
-
Timeliness is something people in the industry strive for, so be punctual
for your interview.