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Driver pay among list of top industry issues


Last month in this space, I wrote about the impact driver and equipment detention is having on the industry. This year, for the first time, the issue appeared on the American Transportation Research Institute’s (ATRI) annual list of top industry issues.

The other issue to appear for the first time was driver compensation. Interestingly, and not surprisingly, this was the top issue among drivers, and didn’t even make the top 10 among motor carriers.

What’s also interesting is that this issue surged to number one among drivers following a year in which most made more money than in the past.

But it’s still not enough.

Bob Costello, chief economist of the American Trucking Associations (ATA), said during a panel discussion at the association’s Management Conference & Exhibition, that driver pay packages have increased, but their take-home pay has not kept pace.

This is for a variety of reasons, including shorter lengths of haul. In 2000, the average dry van truckload of freight traveled 800 miles, which has diminished to 503 miles. Fleets that used to put 125,000 miles a year under the bumper are now struggling to get 100,000, according to Costello.

Drivers are spending more time bumping loading docks and less time traveling down the road, making money.

Which ties into last month’s theme about driver detention, and how unacceptable it is. Drivers are being better compensated for every mile they run, but are now spending more time at shipper and receiver facilities, and in many cases, not being adequately compensated for that time.

And while everyone would agree drivers should be paid more, the reality is there’s now an oversupply of capacity. Fleets relying on spot market freight are struggling to get by.

“You can’t unring that bell,” James Reed, CEO and president of USA Truck, said of driver pay increases that were put in place during a strong 2018. His company raised pay rates 6.5%.

Costello agreed.

“Now you have a softer rate environment,” he acknowledged. “I think a lot of those smaller fleets in the spot market are going to struggle this year. You can’t walk that (pay increases) back. There’s less freight and lower rates. It’s tough.”

Already, we have seen a spike of bankruptcies among fleets south of the border. That trend has yet to surface in Canada, but can it be far away? As freight volumes soften and shippers flex their muscles, fleets will have to be very creative and forward-thinking to survive.

 

 

 

 


James Menzies

James Menzies

James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at james@newcom.ca or follow him on Twitter at @JamesMenzies.
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2 Comments » for Driver pay among list of top industry issues
  1. Jim Bradbury says:

    Fleets have to come to grips that we really don’t have a driver shortage! Treat employees like everyone else does in other industries. When business slows lay off drivers, they then collect EI! Instead of starving all drivers.
    When negotiating consider wages a fixed cost! Too many companies drop rates then drop wages to win contracts.
    Every move I’ve made is a result of companies taking advantage of slow periods, wen they hire more than they can feed! Then I’ve jumped ship. Show some respect to current employees. If in good times you need drivers then raise pay to attract drivers!

  2. Lloyd says:

    I just started at a new company in Chatham, On
    I do not feel they are right in what they are doing. They put us Canadian drivers in USA trucks with US ownership, plates and Ohio annual inspection. They say they have been doing this for 10 years. If this is the case why would a Canadian trucking company ever buy a truck in Canada and pay all the HST, GST, (because they are used trucks they bring in from Penske USA) Inspection then plate them in Ontario, All there other trucks are Penske Canada,
    I do not want to lose my FAST card or my right and lively hood to enter into the US.
    Could you help me out here please I am feeling bullied.

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