Labor is so tight that $30 an hour offer couldn't pull in truck drivers at South Dakota cooperative

Two men stand in T-shirts and one in a ballcap, flanked by the co-op elevator they manage. — Brad Tangen, 50, general manager of the Farmers Cooperative Elevator Co., Inc., of Rosholt, South Dakota, manages the agronomy side of the business while Jordan Krump, 32, manages the grain merchandising. Photo taken July 21, 2022, at Rosholt, South Dakota.

By Mikkel Pates

August 08, 2022 at 5:30 AM

ROSHOLT, S.D. — It’s getting harder and harder to find labor for agriculture in rural communities, and 2022 was an eye-opener in Roberts County, South Dakota.

One co-op was trying to hire truck fertilizer “tender” drivers for the spring harvest and ended up hiring independent truck firms. Although grateful for the independent companies, it tripled the costs and the co-op’s semi-tractors stood idle.

Smaller trailers are parked with augers stand at the right while larger semi-trailers are at left. — Smaller fertilizer tender wagons, right, may go by the way at Farmers Cooperative Elevator Co. Inc., of Rosholt, South Dakota, as the company turns to the larger volume semi-trailers, left, to reduce the number of drivers needed. Photo taken July 21, 2022, at Rosholt, South Dakota.

Brad Tangen is general manager of the Farmers Cooperative Elevator Co. Inc., of Rosholt, South Dakota. The co-op, founded in 1914, serves 200 patrons and handles 9 million to 10 million bushels of grain each year. Patrons come from multiple counties in three states — Richland, in North Dakota; Traverse and Big Stone in Minnesota; Roberts and Marshall in South Dakota.

They offer full-service agronomy, with custom application of crop fertilizers and chemicals, as well as seed and seed treatment.

Availability of labor is getting tighter in the state.

Access to ‘town’

Rosholt has about 430 residents and the town is about 34 miles from the larger towns of Wahpeton, North Dakota, and 25 miles to Sisseton, South Dakota.

A man in a T-shirt stands in front of the bins of fertilizer that are mixed for delivery on farms. — Brad Tangen, general manager of the Farmers Cooperative Elevator Co. Inc., of Rosholt, South Dakota, says a declining rural population, competition with larger towns and more expensive training for commercial drivers licenses are among challenges his company faces. Photo taken July 21, 2022, at Rosholt, South Dakota.

“It’s becoming increasingly difficult to recruit young people to come and work in areas like this,” Tangen said. They focus on things they can control, like training and benefits.

“There are more opportunities elsewhere, but we try to make it an attractive enough environment that they want to stay here.” Sometimes it hinges on a partner or spouse having a job.

The one-site co-op has 20 full-time employees. They usually hire eight to 10 part-time employees, seasonally, usually hauling grain in the fall or fertilizer in the spring — typically April to the end of May.

The single-site Farmers Elevator Co. of Rosholt, S.D., stands with its new office and scale at right. — Farmers Cooperative Elevator Co., at Rosholt, South Dakota, in the spring of 2022 advertised $30 an hour fertilizer truck driving jobs, but got too few applicants to fill them. They felt fortunate to be able to hire private trucking companies, but it cost three times as much. Photo taken July 21, 2022, at Rosholt, South Dakota.

They start advertising for spring positions early in February and March.

“We just didn’t have any applicants, other than — thank goodness — the people from town here that have worked for us in the past, the folks that have retired from their other jobs and have the time to do it,” he said. “Thank goodness we had them. But to find new people to come in, it’s just getting increasingly difficult.”

Often, they can find people who have construction jobs in the summer, but can start at the co-op before the construction season. Historically, many of the temporary employees were retirees, still fully qualified with commercial drivers licenses and endorsements.

Normally, they pay $20 or more.

A $30/hour ad

This year, the co-op advertised “upwards of $30 an hour.” But they just didn’t have any or many applicants from the ads. Their only seasonal employees were four retired townspeople who formerly had worked at the co-op and still had effective CDLs. “To find anybody else was, basically, impossible.”

A fertilizer truck with a Farmers Elevator decal on the door, stands in a bay, transferring materials. — Farmers Cooperative Elevator Co. of Rosholt, S.D., was able to hire only four of their needed ten truck tender drivers for the 2022 planting season, despite offering $30 an hour pay. They had to hire private companies at triple the cost. Photo taken July 21, 2022, at Rosholt, South Dakota.

Despite the eye-popping pay boost, they still only found four of the eight drivers they needed. They had to hire on three trucks from different trucking companies, but still were one truck short of what they needed.

Tangen felt fortunate to have the outside trucking firms to hire, but noted there are limits to that availability, too. One of the companies does hauling materials for large-scale dairies in the area.

CDL barriers

One issue is that new CDL rules require more training to obtain a license. “It’s just getting harder and harder to find people that actually have the license,” Tangen said. “And — you know — you don’t want to just stick anyone in a truck. You want them to be as safe as possible.”

In the past the state required CDL manual knowledge. It costs about $4,000 in educational courses, Tangen said.

A co-op elevator and agronomy center stand against a town of about 450. — The Farmers Cooperative Elevator Co., at Rosholt, South Dakota, is a full-service, stand-alone enterprise, established in 1914, and serving about 200 farmer clients six counties in the South Dakota, North Dakota and Minnesota. Photo taken July 21, 2022, at Rosholt, South Dakota.

Tangen, 50, said he expects this particular labor problem will become more difficult as time goes on. “These small towns, you don’t get a lot of people that stick around and want to work here. They move on to bigger cities. With the aging population in this area, it’s really become a challenge.”

Instead of $30 per hour for a truck driver, the co-op must pay $90 to $100 for the trucking firms, who provide their own tractors but pull co-op trailers.

“The bottom line is we have such a small timeframe to get a lot of work done,” he said. “But I’m very thankful for those people to come in and do it, because the bottom line is, we have a small timeframe to get a lot of work done. Without these people, we wouldn’t be able to get done what we get done.”

Tangen hasn’t tried to take his concerns to policy-makers at the state or federal level.

“I think it’s just something we’re going to have to adapt to going forward,” he said. As the co-op expands, the company will try to hire more full-time people and get them CDL-qualified.

Going bigger

The co-op is shifting away from smaller “tandem” trucks, Tangen said. They’ll consider purchasing more higher-volume semi-trailers so that they don’t have to have as many trucks — and drivers — on the road. Plus, they have more application both for grain and fertilizer.

“But at the same time they’re getting the same amount of work done because they can haul twice as much.”

A man in his 30s stands in a ballcap, smiling in front of the grain elevator facilities he manages for a co-op. — Jordan Krump, 32, grain merchandiser for Farmers Cooperative Elevator Co., at Rosholt, South Dakota, oversees grain acquisition and sales. “I think it’s going to be a struggle going forward with everything in the economy inflated. Every business has had to up their wage,” he said. Photo taken July 21, 2022, at Rosholt, South Dakota.

Jordan Krump, 32, grain merchandiser for the co-op, oversees grain acquisition and sales, dealing with incoming grain and rail transportation.

“It’s all hands on deck, we’ll dump 400 to 500 trucks a day during the heat of harvest,” he said. “Everybody’s busy.” Most people in the ag industry understand there will be extended hours in the spring and fall.

Krump said the full-time crew will be pressed into service in crews, running 7 a.m. until 8 p.m. to 9 p.m. A handful drive 30 miles one-way each day. They are a 110-car unit train shippers on the CP Rail line.

“I think it’s going to be a struggle going forward with everything in the economy inflated. Every business has had to up their wage. You can only up it so far until it starts eating into your cost of business. It’s going to be an issue. A lot of it gets filtered to the end user. You have to make that work, or you’re going to have to shut down," he said.