Truckload Driver Turnover Rate Dips

Driver turnover rates for truckload carriers unexpectedly dipped at the end of last year, but the American Trucking Associations economist who runs the survey characterized the shift as a temporary “reprieve” rather than a durable change in trend.

And several trucking executives said they expect the market for drivers to tighten as 2012 progresses.

ATA’s report said the annualized turnover rate for drivers at truckload carriers with at least $30 million in revenue declined to 88% in the fourth quarter from 89% in the third quarter. For small truckload carriers — those with annual revenue of less than $30 million — the rate declined to 55% from 57% in the third quarter.

“The reprieve, while surprising, is likely temporary. As the economy continues to recover, freight volumes should continue to grow, which — along with regulatory challenges related to hours of service and the government’s CSA fleet oversight program — will continue to cause the driver market to tighten and the turnover rate to rise,” said Bob Costello, ATA’s chief economist.

“Our experience matched the report and continued into the first quarter of this year,” said Mike Gannon, group president of CRST International’s fixed asset division. “But we’re also finding it more challenging to get drivers. I’m seeing a lot more advertisements out there.”

CRST, Cedar Rapids, Iowa, ranks No. 26 on the Transport Topics Top 100 list of the largest for-hire carriers in the United States and Canada. The carrier uses a mix of company drivers and owner-operators.

Turnover rates in general have been increasing since hitting bottom — 35% to 39% — at the end of 2009 and early 2010.

They are still far below their record highs — 136% a year for large carriers and 114% for small truckload firms — that were set in the middle of the last decade.

ATA also said turnover at less-than-truckload carriers in the fourth quarter was much lower: 12.5% a year for pickup-and-delivery drivers and 6.9% for linehaul drivers. Linehaul had the lowest rate for any category of trucking employees, ATA said.

While the report focuses on company drivers, CRST’s Gannon said owner-operators also are in short supply.

“Over the last three years, a lot of them have exited the industry. They lost their trucks and haven’t come back,” he said. To compensate for that, Gannon said, CRST runs a lease-to-own program that provides owner-operators with easier access to capital. “This helps offset some of the problem. We lease the trucks at attractive terms.”

He also said truckload carriers are working more closely with driver training schools that develop new entrants, institutions often ignored during the recession.

The Truckload Carriers Association is trying to develop strategies to attract younger drivers, said Chris Hummer, chairman of TCA’s recruitment and retention committee. He said the industry needs to create pilot or apprentice programs to attract 18-to-20-year-olds, even before those people can get a commercial driver license to haul interstate freight.

In talking to other TCA members, Hummer said fleets are doing more to retrain drivers who pick up points under the federal government’s Compliance, Safety, Accountability program.

“If you’ve got someone who wants to work for you, fleets seem to be focusing more now on retraining. . . . Fleets are doing what they need to on retention more than ever before,” Hummer said.

The construction industry has long been a labor competitor for trucking. Although that sector has not yet recovered from the recession, there is growing competition in the booming natural gas and oil industry.

“We’ve lost three drivers to the energy companies,” said John Fritzius, chief operating officer of Motor Carrier Service, Northwood, Ohio. He said the hydraulic fracturing, or “fracking,” that is part of gas exploration uses a lot of trucks and needs drivers.

Fritzius said those companies offer regular salaries and higher wages for similar work, and the trucking industry needs to go through a driver revolution.

“We, as an industry, can’t keep treating drivers like third-class citizens. In what other industry would an employee be expected to work for free for two hours when there is detention at a loading dock, and the truck can’t be unloaded?” Fritzius asked.

He added that CSA has made recruiting even more difficult, and he has to pursue 40% more applicants to land the same final number of satisfactory drivers.

ATA’s report also stated that large truckload carriers increased their employment rolls slightly during the fourth quarter — by 0.1%. Over the same period, small truckload carriers trimmed employment by 1.1% and LTL carriers reduced payrolls by 1.4%.

Large truckload employment grew by 1.6% in the third quarter and 1.1% in the second quarter.

Dispatchers at large truckload carriers also moved around a lot, with an annual turnover rate of 104.7% — the highest rate of any category of employees in the report, ATA said.