Industry Warned About Driver Pay Problems

Driver pay — a hot topic at the Transport Topics Management Outlook Forum a year ago — is taking a back seat to more pressing issues as carriers struggle with high fuel costs and a softening of freight activity.

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Nonetheless, David R. Goodson, editor of the National Survey of Driver Wages, said he is disappointed that shippers and carriers have not agreed to adjust rates based on an index of driver wages.

“Until shippers are shutting down plants because they can’t get products moved, a lot of them are not going to change,” Goodson said.

Meanwhile, profit pressure has put a hold on driver pay raises. Only 14.7% of carriers surveyed in the period from July through September changed driver wages, the lowest percentage in the 4-year history of the survey. In addition, 50% of the changes were in the carrier’s fringe benefit package.

Goodson tracks company driver and owner-operator compensation at more than 400 truckload fleets four times a year. He sells the information to carriers through his company, Class 8 Solutions in Eagan, Minn.

In a survey earlier this year, Goodson found that some companies were raising health-care deductibles and eliminating bonuses in order to afford higher driver wages (2-21, p. 54).

In his remarks at the forum on Dec. 4, Goodson said the ability to manage drivers and control turnover is the “biggest single factor [that will] define the winners and losers of the future.”

“The people who do well are going to manage their driverforce well,” Goodson said.

According to his analysis of truckload operations, there is about a $15,000-a-year swing in profits when a tractor is driven by a good driver vs. poor driver. The analysis excludes the cost of accidents and turnover.

For the full story, see the Dec. 11 print edition of Transport Topics. Subscribe today.