Truck driver turnover has been at historic lows for the past few years due mostly to the poor economy and tightened capacity in the freight business. And although, after a year of quarterly increases, the driver turnover rate at large truckload fleets unexpectedly dipped one percentage point in the fourth quarter of 2011, fleets can continue to expect turnover to rise.
The poor economy has held the usually abysmal truck driver turnover rates at large truckload fleets at substantially lower-than-usual levels since 2007, when churn averaged 117%. Turnover among large truckload fleets bottomed out at 39% in the first quarter of 2010 and has been on the uptick ever since, rising steadily to 89% in the third quarter of 2011.
So the drop to 88% in the fourth quarter was unexpected. But fleet managers shouldn’t place too much faith in driver turnover maintaining low levels, Bob Costello, American Trucking Assns. (ATA) chief economist, warns.
“This reprieve, while surprising, is likely temporary,” Costello said. “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.”
But while driver turnover may have dropped a bit recently and has been down for a few years, only in trucking would 88% employee turnover be considered a “reprieve.” The trucking industry has serious issues it needs to address if it ever wants to significantly improve the driver turnover situation, according to one of the few independent studies of the driver turnover issue.
The study, “Examining Driver Turnover and Retention in the Trucking Industry,” was prepared in 2009 for the Center for Intermodal Freight Transportation Studies, The University of Memphis and Vanderbilt University and provides an interesting perspective on the trucking industry driver situation.
“Unfortunately, driver turnover and retention problems have been such a dilemma
for so many years that the condition has almost become an accepted obstacle and expense in the trucking industry,” Haskel D. Harrison, research associate professor at the University of Memphis said in the report.
And much of the information available on the state of driver turnover in the industry is questionable, Harrison’s report said.
“Much of the information on turnover, retention and the motor carrier labor market is anecdotal and has been provided by the industry itself or by industry consultants,” the report states. “The trucking industry is highly competitive and basically opaque, where independent investigations are uncommon, independent surveys are rare, and academic studies are forced to rely on limited industry data and publications.”
Harrison points out that conditions that influence truck driver turnover and retention are well known and have “become part of the fabric of the industry.”
The most widespread driver concerns, his study found, typically include: a lack of communication, a lack of respect for drivers and drivers feeling unvalued; requirements to be away from home for long periods of time; insecurity toward top-management; and pay and benefit issues.
“In general, industry management has failed to respond to driver needs and has outsourced training programs that have attracted secondary drivers,” Harrison said. “These factors, in addition to the industry’s inability to address dissatisfaction over salaries and benefits has ultimately contributed to and promoted churning or job-hopping.”
“Addressing the trucking industry’s shortfall in capacity and maintaining a strong workforce will require measures to attract drivers who will work in spite of the sometimes sparse amenities associated with the working environment,” the study pointed out. “Although elements that promote retention have remained essentially unchanged for the past two decades, specific alternatives that address those retention concerns have not been identified or evaluated.”
In terms of dispatcher effectiveness, research suggests that dispatchers are more
important in a company’s ability to retain drivers than is often realized, Harrison said. “Companies whose dispatchers respond more successfully to driver concerns are more likely to experience lower rates of voluntary driver turnover than companies whose dispatchers are not responsive. Expecting high performance from dispatchers requires appropriate training, tools, and working conditions.”
According to Harrison, identifying and keeping effective dispatchers requires:
- Job- and company-specific realistic job preview for dispatch at training that is available to current and future employees.
- Personality assessments to pinpoint potential dispatch/driver problems and to specify employee training needs.
- Promoting and treating dispatch as a success area—as an aspiration instead of a “stepping stone.”
In terms of recruiting and retaining qualified truck drivers and dispatchers, the study found that carriers should develop a Realistic Job Preview (RJP) specific to each position. “Through RJPs, applicants get a glimpse into what their future job would be if they complete the selection process and are hired by the organization to fill the position. Realistic information provided to applicants allows them to make an informed decision about whether or not they should continue with the selection process or self-select out,” the study said.
Harrison and his researchers reviewed alternative strategies that have been recommended and applied over the past 25 years in an attempt to solve turnover and retention problems in the trucking industry.
“Most of these tactics appear to be obvious and necessary components of any successful business — especially if the techniques are applied uniformly, seriously, and widely,” he said. “However, there is little evidence of the successful application of any of these strategies in the trucking industry, particularly in terms of producing a lasting and meaningful impact on turnover rates.”
The fact that the trucking industry is well-aware of successful strategies to reduce driver turnover and is reluctant to apply them, Harrison said, “suggests the trucking industry can tolerate the condition.”
“As no trucking company has successfully demonstrated that the costs associated with attacking turnover can be offset by profits gained from increased retention, the assumption could be made that the level of turnover and retention is appropriate for the prevailing business climate in the motor carrier industry.”