For years, industry experts have tried to convince us that pay is not the most important factor in driver turnover and the inability to attract new recruits into trucking. “It’s about home time.” many said. “It’s because drivers feel unappreciated,” others insisted. “It’s because trucking has a negative image,” still others whined.
To which we politely say: Bull. Those factors are important, but they don’t put food on the table, and they don’t make earning $40,000 a year seem like adequate compensation for logging 70- to 80-hour weeks in a difficult, dangerous job.
Shippers can’t get their freight moved because there aren’t enough drivers to pull it. And carriers are realizing that the driver shortage may exist because there are a lot easier ways to make $40,000.
In fact, during a recent forum, some of the nation’s largest carriers said they think pay may have to increase to as much as $65,000 per year in order for the industry to attract enough drivers. Some less-than-truckload carriers already pay drivers $65,000, they said, and have less than 20 percent turnover.
It’s safe to say that carriers would be hard-pressed to raise only company driver pay. In order to woo and keep owner-operators, your compensation would have to rise, too.
The solution wouldn’t come cheap. Even though carriers estimate turnover costs them about $6,000 per driver, increasing wages by $20,000 or more a year per driver costs substantially more. If a carrier pays its 500 owner-operators $1 per mile and each one runs 120,000 miles per year, that’s a $60 million annual cost. Bump that to just $1.20 per mile, and we’re talking $72 million per year. The $3 million that carrier might save in recruitment doesn’t begin to cover the additional $12 million.
Other factors would help defray those costs, though. Because higher pay would make competition for jobs more intense, carriers would be able to choose from a larger, potentially safer, driver pool, which should translate into lower insurance costs. Carriers will realize productivity gains – and higher profits – from continuing shipper cooperation under the new hours-of-service rule. And increasing freight rates should make it easier for carriers to throw more cash your way.
When trucker pay finally increases substantially, my money says it will have a huge positive impact not only on the driver shortage, but on truckers’ attitudes and the industry’s image. When that happens, we can all say, “We told you so” to the “It’s not about the money” crowd. And that’s payback you can take to the bank.