Driver turnover has remained above 90 percent for large truckload carriers for 11 consecutive quarters, and recently hit an annualized rate of 97 percent in the third quarter of 2014. Indications of an improving US economy negatively impact driver turnover rates as competition from high paying industries such as construction and energy to attract drivers is fierce.
While truckload carriers’ benefit from an improved economy, the increase in business often presents additional challenges. More business eventually means adding capacity or stretching the limits of what is already in place. Drivers will initially appreciate the increase in pay but may ultimately balk at the crazed work pace. As some drivers leave it becomes more expensive to recruit and train new drivers. Some estimates have recruitment and new driver training costs of $8,000 - $10,000. Additionally new drivers tend to have more service and safety issues. The overall effect is increased business costs, and difficulty maintaining operational efficiency and quality customer service.
Small fleets have typically maintained a lower than 90 percent turnover rate but that has recently increased to 94 percent as some drivers are moving to large truckload carriers in search of better pay and benefits. Larger carriers often offer better benefits and home time with newer equipment and overall solid financial stability.
Retention and profitability has improved for large truckload carriers who have adjusted pay, benefits and incentives to meet the expectations and demands of drivers. Tight capacity has increased freight rates across the board and unfortunately, the pool of new drivers has not kept pace as other industries such as manufacturing, construction and energy have been able to recruit young people who may have considered a career in trucking. There is also difficulty attracting strong dispatch and operations employees who ensure that freight moves smoothly and drivers are treated well.
Driver recruitment is the beginning of driver retention, so having a strong recruitment discipline is critical to increased revenue and profitability. HUB Transportation offers tips in Meeting the Challenge of Driver Recruitment and can assist in your efforts to identify the right team for your operation.
HUB Transportation Insurance Service advisors understand the challenges of driver retention and can help you to identify disciplines to keep drivers on your team.
HUB International Transportation combines national reach with local service to address the needs of large fleet, small fleet, and single owner trucking operations. We have exceptional market access, educational resources, and a deep bench of experts who are solely focused on serving the trucking industry. -
Steven Bojan, is the Vice President - Fleet Risk Services, for the Risk Services Division HUB International. To reach Steven or a local HUB risk services expert click here.