MT : Let's start with the positive news. Canadian fleets appear to be doing a better job of retaining drivers. Your research found that the average driver turnover rate among Canadian fleets was down ...
MT: Let’s start with the positive news. Canadian fleets appear to be doing a better job of retaining drivers. Your research found that the average driver turnover rate among Canadian fleets was down to 22%, compared to 36% when you conducted similar research in 2002. That’s also significantly better than the turnover rates in the US. What are Canadian fleets doing right on the retention front?
Gauthier: What we found this time around is that drivers are being treated differently. I think trucking companies are taking on some of the models from the other industries they are competing with to attract people. One of the big issues we found is the type of benefit packages that are now being offered drivers. Once you’re receiving a salary that you feel is acceptable you are looking for the additional pieces that are very valuable. Insurance, health benefits, paid time for training, guaranteed days off, performance incentive programs – when you add all of these it impacts retention. We also asked what were the top things that made an employee stay with a company and the responses we got from drivers included well-maintained equipment, pre-arranged paperwork, paid waiting time and clean cabs.
MT: Yet despite the improvement in retention, your research has identified an escalating shortage of qualified commercial drivers across Canada. About 12% of the industry’s job openings are remaining vacant. Do we have a good sense of what is causing the driver shortage to escalate?
Gauthier: Companies want to hire qualified drivers. There is not a shortage of drivers; there is a shortage of qualified drivers. New entrants coming into the industry are not meeting the industry standard, which is not helping fill those empty seats. Also, not everyone is interested in the driving lifestyle. In some companies the working lifestyle includes long hours and being away from home and that does not appeal to a lot of people. In some cases, the pay is not competitive enough. And truck driving is not an attractive occupation to youth. And, of course, the aging of the workforce is affecting not only us, but many industries. We have amongst the oldest workers and that will impact the vacancy rate.
MT: I understand there are also recruitment and retention issues unique to regional challenges. Can you fill us in?
Gauthier: Lower driver shortage rates are found in Ontario and Quebec and that’s basically because of the economic slowdown in the United States and the downsizing of a lot of manufacturing. On the other hand, the shortage is higher in the West, particularly in Alberta. BC is another province with a higher level and that is attributed to construction tied to the Olympics and the issues around the Asia-Pacific Gateway. Atlantic Canada’s shortage is also higher than the average and we believe a good portion of that is due to the fact that a lot of people from Atlantic Canada are going to Alberta for jobs. That’s the picture today. The economic slowdown in Ontario and Quebec could change within the next 12-18 months and can be volatile to one extent or another.
MT: What impact is the driver shortage currently having on motor carriers?
Gauthier: One part of our research, the empty seat survey, looked at what the problems were. Over 40% of the carriers surveyed said the lack of qualified drivers impacted their ability to move freight. Over 70% had refused or delayed shipments. And 40% had to delay or cancel future business plans. We’ve also been talking with the shipping community and we will probably do a survey to try to zero in on those numbers because they are seeing a problem in getting the freight moved as well.
MT: There is a “greying” of the industry that is rather alarming. Among the most popular professions for men, trucking has seen the largest increase in average age since 1987, according to research conducted by Transport Canada. The average age for a company driver is 42 and the average owner/operator is 45 years old. The year 2004 marked the first time truckers 55 and over outnumbered those under 30. Your own research found that the industry’s newest drivers don’t tend to consider trucking until after they’ve worked in other careers, and 60% of them are over the age of 30. Why is trucking usually the next choice?
Gauthier: I think one of the reasons is because younger people don’t see career opportunities in the trucking industry. When people think of trucking they think of just the truck driver; they don’t think of all the other occupations that are tied to trucking. Young people today are looking for opportunities to move within a company. I think there are also other issues such as the fact that companies need people to be over age 21, they don’t have the ability to hire young people at age 18 or 19, and so they are being attracted to other industries before we have a chance to attract them. I think also because our industry is not well known, parents are not encouraging students to go into the occupation. This is something we hope to correct with career awareness projects. These are some of the reasons we are getting “second career” people but there is also an advantage to that. You’re getting people who have experience in the work force and know what they want to do. It’s not just a dream; it’s a lot more serious for them. But there are also higher expectations from someone who has been in another career.
MT: How much of an issue is money? A few years ago, Russell Gerdin, CEO of Hartland Express, considered by many as the best-run trucking company in North America, said driver salaries have to get up to $70,000 a year to attract drivers. Is that what needs to happen?
Gauthier: I think financial issues – and it’s not just tied to salary but rather a larger package which includes benefits – are important because of the cost of living and working today. More companies are paying for waiting time and making time for training. When you provide training opportunities and pay for the employee’s time, you are making an investment in your employee. And when you invest in an employee you are telling them that they are important to you and it has an impact on retention. Work schedule in terms of hours and how it’s distributed is also important. Drivers are looking for a lot more than just salary, but the salary base is important and it has to be competitive.
MT: What role can the creation of a career path play in attracting and retaining drivers? Many of the industries that draw from the same labour pool as trucking do provide a career path.
Gauthier: I think it would but we have to be careful because you have a large base of drivers and then after that the other positions within a trucking company are very narrow. A driver may consider becoming an owner/operator and if he stays as an O/O, he is still filling in the need for drivers. But a lot may decide to go into dispatch or safety and compliance or training and I think there are opportunities there. Look at the companies that exist today. How many of the owners started off as drivers? I think there is an indication that someone can be very successful starting off with a driving position.
MT: One thing that the public and politicians have a hard time grasping is that when you look at the numbers, on the surface there seems to be plenty of people to place behind the wheel – Canada has 662,400 Class 1/A licence holders, which places trucking among the top three jobs for Canadian males. Why is that overall number deceiving?
Gauthier: It’s deceiving because it corresponds to all the people who have decided to acquire a Class 1/A licence for purposes other than to drive commercially – firemen, construction workers, farmers, hydro workers can have Class 1/A licences. There’s also a lot of people who hold a licence and are no
longer driving but won’t give up the licence. We studied the potential of attracting some of these people back to the industry and our research showed there is not large enough numbers that we could attract. We have to focus on new individuals who are ready to stay within the industry.
MT: Considering that 73% of inactive licence holders are over the age of 45, would it have been a viable long-term alternative even if you could attract them?
Gauthier: We don’t think so. To reintegrate a lot of these people would require quite a bit of training and maybe some of them would not even qualify based on their abstract and other criteria. We’ve decided there are other strategies and groups to consider rather than looking at this group.
MT: What about women and minorities. We’ve long heard that the industry needs to do a better job in attracting candidates outside the “white male” box. Is any progress being made there?
Gauthier: I had a conversation just recently with a major carrier out West and they are building a new facility with plans to have an independent locker room and shower for women. One of the complaints from women drivers is that either at truck stops or at the carrier building there are no facilities specifically for them. I think you would find more women coming in to the industry if companies provided the right type of environment. As far as minorities are concerned, I think a lot of companies are bringing in immigrants or hiring minorities already here. But I think the challenge is to recognize that some of these people have a different culture. If we think that these people can come in and completely adopt our culture without any kind of recognition of theirs, we will not be doing all that we can to retain them. Companies have to be willing to make changes to the way they do business and how they treat their people.
MT: It’s important to stress that the need is for qualified drivers. I understand your research looked at training and experience issues as well and found a dire need for training even for licence holders. Can you elaborate?
Gauthier: The licence holders currently employed indicated some very clear areas where they felt they could use some upgrades, such as regulations, coupling and uncoupling, shipping transmissions, and defensive driving. Other areas identified included reading, writing, and math. Companies that ask their drivers how they can help them do a better job will probably choose better educational programs that will in turn help retain drivers.
MT: What’s the next step you will be taking with your research?
Gauthier: Part of our plan is to do a phase three of the research. Rather than just focusing on the driver occupation, we know there are other industry positions also facing shortages. We will have a labour market research project that will look at these other occupations in trucking. We’ll also be looking to develop a forecasting tool that would permit us to provide the industry with up-to-date numbers on a regular basis, potentially looking at the labour supply. We hope to start that in January.
MT: The driver shortage is an issue that can only get worse when shipment volumes return to what we saw from 2004 to 2006. In your communications you emphasize there is no ‘magic bullet,’ but what can fleets do?
Gauthier: The largest portion of that shortage has to do with turnover. That is something the industry can deal with directly. You can’t do much about retirements. Companies should concentrate more on reducing turnover. This industry is all about people and we have to take a closer look at how we treat our people and how our business functions with the people we have. We have to look at what other industries are doing and not just look internally because we are competing with those other industries, which are also facing labour shortages. We have to do a better job of screening future drivers and bringing them into our companies. We have to make sure we are bringing the type of people into our companies that will stay with our companies. And we have to consider changing the way we do business. If we want to retain some of the retired people, maybe we have to split the timing and have two older workers sharing a truck. The CTHRC has developed an HR Guide, which is a tool for non-HR professionals who are directly involved with recruitment, retention and turnover issues. We are hoping this will help the industry better retain its people.