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Driver pay not the answer to the driver shortage dilemma

LAS VEGAS, Nev. -- Driver pay may be an important issue, and perhaps the one the gets the most attention when addressing the driver shortage, but it's not the best answer, according to a panel of US trucking executives speaking at the ATA...



LAS VEGAS, Nev. — Driver pay may be an important issue, and perhaps the one the gets the most attention when addressing the driver shortage, but it’s not the best answer, according to a panel of US trucking executives speaking at the ATA Management Conference this morning.

Placing drivers in quality equipment and getting them home more often are just as important, if not more so, than raising pay, said Derek Leathers, president and COO of Werner Enterprises.

Werner reworked its network to get more of its drivers home on a weekly basis. Back in 2008 only 38% of its drivers we’re getting home on a weekly basis; now it’s up to 71%. Werner hires a lot of drivers out of driving school so its turnover rate is around 85%, but getting more of them home on a weekly basis helped keep the turnover rate from climbing higher, Leathers said.

“This is hard work that we are asking them to do and I would argue that with the new generation it’s not just the trucking they don’t want to do; it’s the hard work they don’t want to do,” Leathers said in explaining that concentrating on more home time also helps with recruitment.

Kevin Burch, president of Jet Express, agreed that pay is not the most important factor in driver retention. He said how a carrier goes about recruiting drivers goes a long way towards reducing the likelihood of turnover.

“Drivers want to be told what they are going to be doing and how they are going to be doing it eye to eye. There are too many companies passing the buck,” Burch said.

Yet even if driver pay is not the top issue, it is stil a critical one. The panelists were asked what a carrier needed to pay to make driving more attractive. Leathers said it’s not easy to come up with a number. There are 140 different pay packages in his company ranging from pay around $30,000 for a first year driver to up to $60,000 for experienced drivers on difficult runs. But here is where it gets complicated:

“There are places in our network where people are making $30,000 and the turnover is almost zero. It could very well be that the highest paying packages in my fleet may be the ones most needing of incentives,” Leathers said, explaining that it’s the complexity of certain runs that determine turnover.

He also questioned the wisdom of industry thinking of moving towards pay by the hour for drivers.

“It’s dangerous to disconnect how drivers are paid from how the carrier is paid. Shippers will continue to want to pay us by the mile,” Leathers said.

What would help with both recruitment and retention is reducing the upfront training costs for new drivers, which can range from $4,000 to $7,000. Yet the panel also heard there is drastic drop in government funding for truck driver training.

The panelists were also not too keen on leveraging technology as either a recruitment or retention tool. Burch questioned how fleets can spend millions on dispatch software yet spend no time training dispatchers how to communicate effectively with drivers.

They didn’t see automated transmissions as particularly helpful either.

“Deciding to focus on switching to automated transmissions on a large scale would be more dependent on the resale value of the trucks because we don’t see them as a big draw for recruiting,” Leathers said.


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6 Comments » for Driver pay not the answer to the driver shortage dilemma
  1. Scott Letts says:

    It is all well and good for these CEOs to tell us drivers what we really want and need is not more money. Well I find that rather funny since all of these people talking at this conference have never been a over the road driver so how in the hell do they know what we want.

    And lets be honest the last thing any of these companies want to do is give a driver more money. Derek J. Leathers is 42 years old never driven a truck and makes 804,388.00 dollars a year and yet he will tell you that a driver is not worth a few pennies more a mile or that he should be paid by the hour.

    I would like to ask all these CEOs of these companies if they believe they should be compensated for all the time they spend at work, and I would bet the answer would be yes, so why in the hell should not over the road drivers be compensated for all that we do.

    If you want to get young people into the this game you have to compensate them for being away from home and having no life, yes I agree getting them home is a key issue, but lets be honest here, as the old saying goes money talks a BS walks.

  2. Melissa Damerell says:

    I’m one of the few drivers that gets paid by the hour and actually receive overtime for over 40. I average 50+ hours a week. I sleep in my own bed and have most weekends off. I won’t work for mileage pay again. I ran OTR for years. Lived out of my truck and ran 156,000 paid miles a year. Tried truck rail and lost my shirt. My pay check one week way $2.47 after a $100 cash advance for road expenses. If I’m sitting in a dock I’m still working. If I’m sitting waiting for the police to clear the road I’m still working. If my 14 is wasting away for something beyond my control, I’m working and expect to be paid. I was once told that 24 hours off was a day off. I got home at noon on Saturday and had to leave at noon on Sunday. I asked the dispatcher if they worked these hours if they would consider it a day off and they said no. Why is it a day off for me but not you? Getting paid by the hour ensures the company won’t waste my time. When the clock keeps ticking the company has motivation to get me rolling. You want to govern a truck and slow me down, you reduce my income potential and need to pay me to work slower. Electronic logs tell you if I’m wasting your time. With the electronics in the truck neither I nor the truck can’t sneeze without you seeing it on your monitor. I’m a professional, get out of the way and let me do my job. I’ll take care of our customers. You just make sure I can support and spend time with my family in return.

  3. Mike Mitchell says:

    Better equipment is all fine and dandy but it’s getting tougher to pay the bills with a shiny new Pete. Home time is also an important factor in hiring on with any new company but if you can make a better living working in a factory or a city driving job why would anyone work for milage rates that have actually gone down in the last decade? These bigwigs are loath to admit their pay rates are inadequate while collecting the big cheques for themselves. Well, I suppose thats their jobs but it’s also their jobs to keep seats filled with qualified and experienced operators. Here’s a newsflash… truck drivers in Europe are paid by the hour! All of them! So, do the argument(s) against really add up? With the coming of EOBRs does anybody really think they will be able to pull over for a few hours of nap time while getting paid? Those days were over a long time ago. Computers can keep track by the hour, by the quarter hour, even by the minute. Where is the problem with that? Would speeding be an issue anymore? (lower rpms save fuel eh?) I bet if insurance companies were asked they would support pay by time rather that miles.

  4. Mike Mitchell says:

    Better equipment is all fine and dandy but it’s getting tougher to pay the bills with a shiny new Pete. Home time is also an important factor in hiring on with any new company but if you can make a better living working in a factory or a city driving job why would anyone work for milage rates that have actually gone down in the last decade? These bigwigs are loath to admit their pay rates are inadequate while collecting the big cheques for themselves. Well, I suppose thats their jobs but it’s also their jobs to keep seats filled with qualified and experienced operators. Here’s a newsflash… truck drivers in Europe are paid by the hour! All of them! So, do the argument(s) against really add up? With the coming of EOBRs does anybody really think they will be able to pull over for a few hours of nap time while getting paid? Those days were over a long time ago. Computers can keep track by the hour, by the quarter hour, even by the minute. Where is the problem with that? Would speeding be an issue anymore? (lower rpms save fuel eh?) I bet if insurance companies were asked they would support pay by time rather that miles.

  5. Andy says:

    What a load these trucking wizards are shovelling. I think that they should be honest and say exactly what they mean ‘they don’t WANT to pay more for quality truck drivers’. Getting hometime wouldn’t ever be an issue if the driver earned enough money to pay the bills at home. I’ve been in this business for over 30 yrs and have never needed to stay out on the road as long as I do now just to earn enough to pay my road expenses and have enough left over to pay the bills at home. As for providing the drivers with nice trucks, you can’t eat chrome! and doesn’t csa require that anyways.

  6. Steve says:

    What a load of B.S.. I guess normal economic rules don’t apply to the trucking industry. Raise wages, and attract more and better workers. You know, I don’t think pay is key to retaining a CEO. I think we should cut their pay and give them more time at home. Mark my words, the trucking industry will push hard for Mexican drivers, just as the hospital industry and IT have done for H1-bs. Given the choice between raising pay for workers vs outsourcing and huge bonuses for executives, greed will surely win.

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