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Carriers Could Pay Higher Wages to Address Driver Shortage

January 6, 2015

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Carriers of all sizes expect driver wages to increase in 2015. Graph by Transport Capital Partners.
Carriers of all sizes expect driver wages to increase in 2015. Graph by Transport Capital Partners.

A shortage of experienced drivers means carriers are hesitant to increase capacity, despite rising carrier costs and rates, according to the quarterly Transport Capital Partners Survey. To address the problem, carriers surveyed expect driver wages to increase by up to 10 percent in 2015.

In the TCP survey, more than 90% of carriers expected driver wages to increase by 6-10%, double the expectation from six months ago.

“Carriers remain hesitant to add capacity because of the shortage of experienced drivers, with replacement far outpacing additions on order boards for new tractors,” said Richard Mikes, TCP partner and survey leader.

The carriers in the survey were split by size into under $25 million in revenues and over $25 million. Larger carriers were more apt to predict a 6-10% increase in wages, while smaller carriers felt it was more likely to be in the 0-5% range.

The wage increase is part of an effort to attract experienced applicants who often go to other sectors like construction that can offer more benefits to drivers who want regular hours and access to better pay. The higher rates are being plowed into wages and other costs.

“Revenue from rate increases will go into purchasing new equipment, driver wages, rising maintenance costs and regulatory costs,” said Steven Dutro, TCP Partner.

Carriers also overwhelmingly support proposals to allow drivers under 21 years old to drive with proper training, in interstate commerce. As much as 84% of carriers support it, including smaller carriers that typically don’t hire inexperienced drivers.

Comments

  1. 1. Cliff Downing [ January 07, 2015 @ 04:55AM ]

    I have always advocated that the age for Interstate drivers be lowered to 18. It is stupid to have some 21 age thing going on. We have no problem sending an 18 year old into combat driving a truck, I don't think it is going to cause major problems to allow them to drive America's roads. Increasing pay is one thing, but if the working conditions themselves are not fully addressed, it really will not be that much of a game changer. There are carriers offering $.50 a mile or more and yet they still have wild turnover rates. It is the entire work experience that needs to be addressed. Some carriers have it figured out and don't need to pay that same $.50 a mile, yet have turnover rates below 20%. I am doing business with one of those carriers now. They address the work environment all the way from the top to the bottom. They deal with an excellent customer base that makes this realistic. As long as carriers just see it as a money game with drivers, they will never get ahold of their problems.

  2. 2. John Mullen [ January 07, 2015 @ 06:59AM ]

    Once again we see higher pay for "practical miles" as a solution to the increasing driver shortage. One of the definitions of insanity is to repeat the same act or procedure again and again and expect a different result. In a more politically correct manner we will simply refer to it as repeating failed practices. Now we add a factor which we recall has been tried in the past - lower the age of commercial drivers. The physical abilities are there but the mental maturity which has been proven to lack the recognition of danger and hazards are detrimental to this proposal.
    Before we call another conference of management and involve ivy league professionals to offer astute solutions could we consider calling upon those qualified with years of experience, safety records, hands on experience and a desire to see the industry attract and RETAIN those who are qualified. Just a thought outside the box.

  3. 3. Marty Marsh [ January 10, 2015 @ 01:12PM ]

    This is always funny stuff, the industry have been chasing the experienced people out of the industry because they did not want to pay. We let a million people in this country every year, they thought that was another avenue to cheap labor, what it isn't working? Then between the companies and the government the industry is over controlled. I drove for 39 years and there is not a scum bag alive that could pay me enough to put up with their BS. The only difference between me and the new kids, is they learn a lot faster than I did. You took a great no paying job and turned it in to just a job, just another job. Everyone sitting in their little cubical driving down the road while some worthless dispatcher is watching. Yes this is the life.

  4. 4. steve w [ April 19, 2015 @ 04:49PM ]

    Any company using a E-log needs to paying over $20 us per hour based on hour worked plus overtime after 10 hour per day. A parking lot worker working for go-transit makes more than a over the road truck driver.

 

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