Channel 19

Todd Dills

Driver shortage: An economist and a recruiter ’round the bar

| March 02, 2013

jeff-clark-profile-newYou’ve got to hand it to owner-operator Jeff Clark (pictured), whom longtime regular readers will know fairly well at this point. The man can break an issue down.

If you’ve missed it as yet, Clark posted yesterday via his new-ish Freightliner Team Run Smart blog (his first post was earlier in February, there joining two other Channel 19 semi-regulars and Trucking Solutions Group members in Henry Albert and Linda Caffee, among other owner-operators) a dissection of the systemic issues around the much-ballyhooed “driver shortage” near-perfect in its presentation as, well, a conversation between two strangers in a bar.

Jeff Clark and four other owner-operators are blogging via Freightliner's new initiative to highlight owner-operator business issues and their new equipment. Find them all here.

Jeff Clark and four other owner-operators are blogging via Freightliner’s new initiative to highlight owner-operator business issues and their new equipment. Find them all here.

It not only makes the points that Clark and others have long been making about the so-called “shortage” — namely that it’s best understood as a pay or rate shortage with long-in-the-making dynamics driving it — but it does so with quite excellent humor. For the first part, get on over to Clark’s blog, where an economist and recruiter get the niceties over with, describing what they do. The economist of course is “never wrong,” he says, because:

We economists like to use the phrase “all things being equal.” Of course, all things are never equal, so we are never wrong. But let me try another example: You walk into a Cadillac dealer with $30,000 in cash and ask to buy a new Escalade. The dealer turns down your offer. Do you walk out of the dealer telling everyone who will listen that there is a shortage of Escalades?

But of course not, the recruiter says. “A new Cadillac Escalade would be worth way more that $30,000.”

Apply those same principles to the driver market, says the economist, and the recruiter begins to see the point.

Clark cut off the conversation at that point (again, find it here) but offered up the remainder to those interested — including, well, me. Following find the rest in its entirety:

Recruiter: … If we can’t get enough drivers we simply aren’t paying enough.

Economist:  Yes, but there are more factors than just money.  Tell me: what are some of the things you do to recruit quality drivers?

R: Last year we put a model in a bikini and put her on billboards and in our magazine ads.

E: How did that work?

R: Not so good — a few drivers called and asked to talk to the bikini-wearing recruiter. We told them that she was just a model and did not actually work here, and they hung up. A few of the drivers asked to see the settlement sheets to see what our guys were making. Then they never called back. We did get one driver to sign on immediately, but the bank repossessed his truck.

E: So have you tried extra incentives to attract these drivers.

R: Yes — we have been very innovative. In fact, we pay our drivers detention automatically after 2 hours at a shipper.

E: What do you pay them for the first 2 hours?

R: Nothing

E: Don’t the fair-labor laws say that you have to pay them.

R: No, interstate workers are exempted from many fair labor laws. Those laws have been in place since FDR.

E: Wow. So what is your turnover rate?

R: Pretty good. Just under 100 percent!

E: That’s good?

R: Yes, the industry average is over 100%

E: Why do you think the industry turnover rate is over 100 percent?

R: Oh, a lot of reasons. Sometimes,  we even have to let good drivers go. We had one last week who got a speeding ticket in a construction zone. It was his first moving violation in over 3 million miles, but we had to let him go.

E: That messed up his record that bad?

R: No, the D.A. reduced the charges to a nonmoving violation, but it messed up our CSA score.

E: So a driver was accused of his first moving violation in 3,000,000 miles but not convicted and you fired him?

R: Yes, the new CSA rules are tough. The government even invited Mexican carriers into the U.S. and then paid for their electronic logs and they wouldn’t come.

E: That is tough, but it can’t be the only reason to explain the turnover rate.

R: No, like I said there are a lot of reasons. Recruiters tend to promise drivers the moon just to get them in the door. Then they give them the same as everyone else in the industry. We even lost one driver to a company that promised to pay him for every mile he drove.

E: Wait — you don’t pay a driver for every mile they drive?

R: No — really, nobody does. We pay them on an antiquated system that was designed to standardize the shortest distance from post office to post office.

E: You mean zip code to zip code?

R: This system was invented before the zip code.

E: Really? So are all of these routes legal for truckers to run? And really, man, the GPS in my car can immediately calculate the distance from door to door. Why don’t you pay them door to door?

R: No, most of these systems just calculate the shortest distance, and the industry standard is hard to change. We just can’t go into a customer and tell them that the distance between two points has increased since last year.

E: Now I see why there is a driver shortage.

  • http://www.facebook.com/jojo.klemm.1 JoJo Klemm

    True.

  • http://www.facebook.com/jojo.klemm.1 JoJo Klemm

    Hours of Service should be for prisoners on parole, only.

  • http://www.facebook.com/profile.php?id=1289745590 Steven Charles

    I was in trucking for only 3 years got tired of the long time away from home and crap wages. Wouldn’t of minded the time away from home if the pay was worth the aggravation, corp. bull shit (swift) and down right rude shippers / receivers that think they are all that and a bag of chips. Yes, it will take the industry to go into “FULL COLLAPSE” before anything will be done!

  • http://www.facebook.com/profile.php?id=1289745590 Steven Charles

    The time has way past for a national shut down. England did it a few years back and it didn’t take long for the government to say “Gosh, we do have a problem, maybe we best have a look at it” and the trucks began to roll again.

  • http://www.facebook.com/profile.php?id=1289745590 Steven Charles

    Honestly? that’s what I ended up doing and made out real good. lol

  • http://www.facebook.com/profile.php?id=1289745590 Steven Charles

    Welcome to Swift

  • http://www.facebook.com/profile.php?id=1289745590 Steven Charles

    It will never happen, this garbage has been going on for years, drivers need money to pay for their rigs and all the expen’s. that go with them , not to mention money for home. No one wants to take the time nor feel the pain of shutting down so they will just continue to bitch about how bad it is, how bad it will be and in the end ….NOTHING will change….EVER!!!

  • http://www.facebook.com/profile.php?id=1289745590 Steven Charles

    Yes Roger, all drivers need to go home. I’ll guarantee you it won’t take but a skippy minute for you guys to be missed. Manufacturers will be screaming “WHERES ALL THE TRUCKS…I’VE GOT FREIGHT TO MOVE”. It’s going to take drivers going home to get the governments attention, to bring them to the table. Right now they think truck drivers are a joke and don’t have the balls to do a “drive out” and so they will just keep jerking you guys chain and things will stay right where they are.

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    So True…..

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    Oh those are the Nastiest of the Crooks…the Broker! Born to lie and cheat!! Easier to get food from a Badger..than get money BACK from the stingy tightwad broker!

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    True!

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    $16 Trillion in Debt too! Not looking good!

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    10-4 I see they NOW give licenses to ANY illegal alien in ILLINOIS effective immediately…must include CDL LICENSES to help out those Mid Eastern Crooks!!

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    Yep the Southwest States are FLOODED with these Spanish Speakers….they are some Nasty Pukes too…not real fond of Gringos.!

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    CHP waves them thru Banning all Day and Night..no questions asked…..

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    That is very true…alot of guys didnt plan on being in trucking forever..it does kind of “grow on you”…..and it IS purdymuch the bottom of the barrel…and getting Worse!

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    True…some of these “rules” could be lifted for drivers with experience….a few lbs overweight or minor LogBook infraction could be accepted if their is PROOF the guy has sufficient time in the industry…also this gives the driver a Little Pride..knowing it is Recognized that he is a Journeyman with an otherwise Good Record….

  • http://www.facebook.com/profile.php?id=1269137418 Mike Jones

    Yep…and Low Paid Idiot at that….or maybe Whipping Boy is just as good! “whiping Boy” needed…low wage, long hours..must be able to stoop, kneel, crawl on belly!!

  • haller

    What would Jimmy Hoffa do? My guess would be, if the driver didn’t speak english he would be roughed up and thrown in the ditch. Next , brokers would be paid a flat fee from the truck, ($200) for getting a load for a trucker, NOT 60% of the freight charge. Brokers would not be allowed to bill shippers or receivers any freight charges. Carriers or groups of OO, or trucking companies would bill shippers or receivers directly, with payment due within 10 business days. If shippers or receivers didn’t pay their shipping bills on time they would get a bad rating on their business profile. The State would then inspect them and fine them for jerking around the truckers. Next, remembering Hoffa, some of the new mega dot scales would be shut down in one way or another. Stop lights would be programed to move the trucks along and through communities not stop them. Small truck stops with real food would not serve 4-wheelers. Amen

  • Michael Wiedman

    David, after hearing the pain; frustration, and anger;rightfully so,…MAN, YOU HIT IT RIGHT ON THE HEAD…TAXES and OBAMA…but don’t even think of including the word CARE, because they DON’T.
    FYI: years ago the government attempted to control the price of EGGS, which has been the staple of dare I say, Every MAN’S real meal breakfast since Wheaties, Corn Flakes and HO Oatmeal dominated our store shelves…OK, so I am not youngster…
    Going after the Little GUY is their specialty, until they RAN INTO PURCHASING COMBINES, who could leverage their power across their ENTIRE NETWORK, turning the smallest player into a GIANT…You see, when you are not the farmer; not the trucker, but you are DETERMINING PRICE…you are a broker, AND NEED VERY LITTLE KNOWLEDGE(THEIR SPECIALTY), NOR CONSIDERATION FOR COST AND RISKS OF ALL THE PLAYERS.
    Here’s the catch 22 for the point I am making. EGG COMBINES MUST SELL THEIR EGGS because they can spoil, but can not be cheated so long as stores need to buy. If the American Truckers STOPPED haulin they’d be fired if part of a FLEET, replaced if an INDEPENDENT, and yes, the impact would be felt, but remember CATCH 22…think of the cost
    Some companies might rehire, but have dropped drivers from group insurance; after 30 days; AUTOMATIC OPTION…IIf it ain’t being paId, it ain’t in force…think of the risk to those with a family plan. For the more desperate Independent, theyd would reduce your rehiring pay…Then there is the old standby…PRESIDENTIAL ORDER that any group action by truckers would be deemed detrimental the United States…not pretty
    Trust me, there is plan in place.
    I specialize in providing Truck Owner Operators; Fleets OPerations 10-12% increased fuel efficiency;REDUCED DEF costs, but still 30% less emission; practically ELIMINATING “GO NOWHERE LIGHT, and testimonials from GUYS like you; “MORE TORQUE; LESS MAINTANCE; LESS WQRRIES ABOUT GETTING THERE AND BACK…LONGER ENGINE LIFE, and I can do this with DIESEL AS WELL AS CNG
    I like an intellectual growl sir, so why not take chance and give me call 717 747-1767, or any of you fellas can reach me thru LInkdin., but keep in mind that same fella whose language offends you,probably has many of the same concerns, someone you’d give a trucker’s nod in silently passing.
    We may not be able to FIX STUPID, but together we can LEVERAGE AGAINST IT.

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