Channel 19

Todd Dills

Pay by performance, rate trends

| February 01, 2014

Gordon Klemp portraitI’ve talked over the years numerous times with Gordon Klemp (pictured, right), the primary analyst behind the National Transportation Institute and its National Survey of Driver Wages, which tracks driver and owner-operator pay packages at a bevy of interstate carriers. (You’ll find Klemp quoted most recently on the subject of hourly pay in my story on detention pay/time from last year here.) In the recent past, particularly for company and leased dry and flatbed haulers, pay’s been going up slowly but steadily from lows during the dramatic recession most of us will remember. 

DSC_0232 (2) (800x563)All the same, when I caught the title of his presentation at the Truckload Carriers Association meeting here in Nashville this past week (see right, and go here for more on the presentation), I wondered what exactly he might be talking about. Turns out, it’s not exactly the typical “driver shortage” type dynamics that are often bandied about at such conferences. Klemp’s “year that changed pay forever” theme seemed to me to hinge rather on a couple of dynamics he sees at play. 

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1. Data analytics and communication and its real use among carriers in determining variable pay rates. He talks a little about this element in the video below. It’s something that’s been enabled by the profusion of in-cab communication devices and the ability of fleets and drivers to track their own performance. A measurable percentage — 6 percent — of pay packages Klemp tracks are now utilizing such a system, updating driver per-mile or other pay quarterly or in some cases as frequently as monthly following performance: miles, fuel mileage, idle time, and other indicators. Anybody, company driver or leased operator, out there operating such a scheme today? Tell me in the comments. 

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2. The 65-and-overs are falling as a share of the total driver population. Klemp’s been following age demographics among drivers for nearly two decades. After 19 years of tracking along fairly steadily, the share of the 65-and-overs among the total group fell for the first time in his numbers. He interprets the drop as clear evidence, as has been predicted for many years now, that the boomers among you are exiting the business is outsize numbers, and (looking at other data as well) that they’re not being replaced on the other end of the age spectrum. This is giving carriers, he notes, more incentive to better compensate drivers and will create opportunities for innovative independents.

What do you think?

In  the vid below, Klemp likewise shows some optimism for the coming year particularly relative to owner-operators under percentage-pay plans — and independents hauling non-contract spot-market freight, where rate gains are most likely. 



  • http://joker-jim.blogspot.com/ Joker Jim

    There is not a shortage of drivers. There is a shortage of drivers that will work for crappy wages. Period.

  • Todd Dills

    Hear you on that, Jim. You may well recall this one: http://www.overdriveonline.com/driver-shortage-an-economist-and-a-recruiter-round-the-bar/

    Still rings true.

  • haller

    OK , so Congress will be paid by performance, I’m good with that, and who shall judge??

  • Ken Nilsen

    I think it is funny really. Most of the people out here who are paying crappy wages are owner operators getting retread company drivers and offering them shiny trucks, chain drive wallets, and paid lawyer welfare(TVC). I worked for a company when I first got into the industry in 1990. I have since owned 3 trucks and over the years, through good management and smart business principles have seen my wages, lifestyle, and on the road comfort improve dramatically. Is it tough? Yes. Is there a driver shortage? No.

    I would like to see more drivers step up to the plate, start a program with OOIDA that would cost zero dollars, and start spending downtime at the truckstops conducting seminars and helping younger drivers. You want to have better drivers out here then get off your ass and start helping and teaching. That is how I learned and that is what I do to help others.

  • Thomas Blake

    Ken, Remember when the only communication on the road was a CB, or talking to others at the truck stops, and if you broke down 3 trucks stopped to make sure you were OK. That is when senior drivers taught new drivers.

  • norman ott

    I learned from a driver that was 60, that was in 76. if you didn’t show older drivers respect they wouldn’t show you shit.

  • Clint

    I agree there is no shortage of drivers and too many illegal drivers out here driving a livable wage down the toilet. I also want to mention that Brokers such Jasp– is a complete joke out here amongst others that gouge the rates so bad we cant even haul for them Its getting bad out here and as a Independent with 30 years of experience in this trucking industry I am finding that this situation is creating nothing but havoc within our industry. In addition when is The FMCSA going to step in and enforce the regulations on these Uship operators that are non compliant nitwit operators that don’t have authority to be there . Our Trucking industry used to be a vibrant and lucrative but its getting out of hand . Our country needs to recognize that there are good competent and compliant operators out here and they need to be recognized, so I applaud anything that associates performance and compliance with our truckers, The good and qualified truckers deserve good pay . So how about it America quit being stingy and reward those who have put in there time and excellent service. I have been trucking for America for going 30 years and yet still feel that I am not getting what I deserve and that’s RESPECT and DECENT PAY.
    P.S And to all of you fellow quality Truckers out there Keep up the good work I really appreciate you!!!
    NW Transport Service

  • ivan67702000@yahoo.com

    Your Performance will be based on how well you kiss ass and suck-off with out spitting? OH the Government

  • uncompensated trucker

    That’s the most sincere answer ive heard in a while and i applaud you.

  • longhorn

    I am leaving the industry at age 60 (and taking over 3 million miles experience with me). Mainly because of overly agressive DOT enforcement. The money is just not worth the hassle anymore. Will be interesting how the newbies fare ?

  • jojo

    The average age of an OTR Driver is 50+. Without the immigrants picking up the less than desirable driving jobs there would not be any new blood except for those, who out of desperation, step out for a year or two and then go back home.
    Cheap freight relies on cheap labor! Labor rates are dictated by the corporate trucking companies. These are the companies pushing for EOBR’s and SPEED LIMITERS to level the playing field in the name of safety.
    I agree that we need to educate others. My banker used to believe that we stay in a hotel the two or three nights a week that we are out. She freaked when I told her that i spend 330+ days year anywhere USA living and working in a space smaller than her bathroom.
    Back in 1990 an old timer told me that he had put three kids through college at the expense of watching them grow up. He then said he was getting out of trucking because there was no money in it. He could not understand how we new drivers were making ends meet.
    In 1990 with one year under my belt I would run 4 to 5 thousand paid miles a week at .21cpm. Many relied on coffee, benny or the bull haulers toothpick. Many of us took it seriously. We worked out and trained ourselves to run the road just as a marathon runner trained.
    180,000 miles paid at .21cpm = $37,800.00. As I understand it, $36,500.00 is the average wage for todays driver.
    Todays driver has had a rude awakening and is looking for a way out or has figured out that there is no need to pay rent and never see the place.
    Todays HS Grads are paying high dollar college tuitions (Demand) to work at McDonalds (Supply) and are struggling to pay back their school loans. With a job at McDonalds these boys and girls can at least build a life together.
    Do the MATH! $36,500.00 / 300 days = $121.66 a day. $121.66 / 24hrs = $5.07 an hr flat.
    Todays Co. OTR Driver is under 24hr supervision via EOBR’s.
    They are required by their companies to take 10.5 hours of break time each day unpaid. They are required to wait, to load, to offload and for a load. UNPAID!!!
    They are managed every minute that they are AT work and only paid if and when they are driving at a rate that is decided by the employing company.
    YES, Educate ourselves and others to the reality of our wages in realistic terms that the real world relates with. HOURS NOT MILES.
    When my banker realized that I ONLY made 50K for 330 24hr days at work she quickly understood that I don’t even make minimum wage.
    As an old timer I believe that an hourly wage for ALL hrs spent AT work for Co. OTR Drivers is the only solution that solves many issues. I’m willing to swallow my pride! I’m willing to admit that I don’t even make minimum wage!
    I understand that we are governed by the clock, paid by the mile and monitored electronically.
    There is a price to pay for safety. As it stands, We drivers are the ones paying the price for what the public seems to demand via more regulations.
    Would a Driver being paid by the hour HAUL BUTT RACING A CLOCK in an attempt to earn a living????
    Are EOBR’s and SPEED LIMITERS necessary to create a safe environment??? How about a LIVING WAGE INSTEAD!!!!!!!!!!!!!!

  • bigred

    I don`t know where these new wages are coming from( I think from some crack head) but this business always has and always will be paid according to the amount of fright that gets delivered. My question is……What makes anyone think they will get more money when the Fmcsa is continually cutting your driving time….Did everyone that comments here just fall off the damn TATER wagon????
    If it takes 4 days to deliver a load that used to take 3, how in the hell can you expect to make more money….geez

  • Mind Games

    Well at least we got the best government that CEO’s in the trucking industry could buy…. errrrrr I mean bribe! Not that it will do much for our pay at least somebody’s happy!

  • Del Ray Johnson

    A bunch of nonsense propaganda by the companies through their marketing agents to convince some stupid drivers. Let me tell you what will happen next a bunch of schemes LIKE WE HAVEN’T SEEN them before fuel bonus, detention pay, on-time pay = no pay increase! Simple .$65 CPM no exceptions.

  • http://maddadkeith.smugmug.com/ Keith Birmingham

    Carriers generally view any condition that causes them to have to pay a living wage to their drivers as driver shortage.

  • JakeOil

    Find hunders of gigs for owner operators here http://owneroperatorgigs.com

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