How High Driver Turnover in Less-Than-Truckload Carriers Impacts Shippers’ Freight Spend
Higher driver turnover in 2019 will be inevitable, and with less than two months remaining in 2018, the best thing carriers and shippers can do today is to work on reducing the burden and stress on drivers.
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Industrywide Turnover Rates for Trucking
Overall, truckload fleets have seen turnover rates jump to 98 percent, and while much of the focus of higher turnover rates revolves around full truckload, the guarded less-than-truckload fleets are starting to see a shift in turnover as well.
Understanding industrywide turnover rates for trucking is essential to reducing freight spend for shippers.
High driver turnover in full truckload can have a compounding effect of eliciting higher turnover rates in Less Than Truckload carriers.
Why Driver Turnover Has Surged
Higher driver turnover rates are the result of multiple factors.
The electronic logging device (ELD) mandate, new technologies, rejected tenders, and poor shipper-trucker interactions can lead to increased job dissatisfaction among truckers.
As explained by William B Cassidy of JOC.com, drivers are often left on the sidelines when new technology is implemented.
While truckers have embraced multiple safety systems, such as onboard cameras, truckers still have a propensity not to take criticism well.
As a result, shippers and carriers need to work on creating constructive criticism and focusing on inclusion and positive recognition.
Mobile technology used by truck drivers is essential in today’s world, so avoiding it is not possible.
Turnover rates have increased 4 percent to 14 percent, marking the highest turnover rate since the first quarter of 2013.
Unfortunately, the LTL segment, which routinely serves to absorb capacity overflows in full truckload, is starting to experience problems.
What High Driver Turnover Means for Shippers
The silver lining in current trucking turnover is that it is not as severe as its all-time high. The turnover rate was 136 percent throughout the trucking industry in 2005, but smaller fleets and Less Than Truckload carriers have typically experienced fewer problems with drivers, reports FreightWaves.com.
For shippers, issues with drivers and high turnover rates are about capacity. The average driver that increases miles driven by 500 miles per month would effectively increase their trucking capacity by 5.9 percent, and increasing the number of miles driven by 1000 miles a month could increase capacity by 11.8 percent. So, that leaves shippers with two outcomes.
Shippers either need to work with drivers to ensure that the majority of their HOS time is spent driving, not stuck in the dock or yard, or shippers will pay higher rates for any OTR transportation. In LTL, the effects of higher driver turnover will drive surcharges and may increase the risk of being hit with detention fees by carriers.
There has been some debate over whether shippers are actually paying detention charges, going so far as to reverse payment months late. Unfortunately, this notion will only undermine the willingness of drivers to work with shippers. In turn, LTL rates will skyrocket.
How to Reduce Impact of High Driver Turnover for Less Than Truckload Carriers
While freight rate hikes are expected in the coming year, the best way to address driver turnover is through changing how drivers are perceived.
Drivers are not merely a necessary evil; they are actual people. The ability of a shipper to make an impact on the lives of drivers is excellent.
Shippers that want to create positive relationships with drivers, and therefore carriers, should follow these tips:
- Make freight attractive. Freight should be ready when scheduled, packaged appropriately and with the right, accurate documentation.
- Use the right technology. Shippers should also consider using technology in their warehouses to ensure they know when a truck will arrive, even when delayed by outside influences.
- Reduce deadhead. The amount of capacity lost on empty backhauls is significant, so shippers should work with third-parties or within their enterprises to make the most of backhauls. The trucker already has to drive it; why not make it profitable?
- Expand carrier-shipper partnerships. Multiple partnerships can help protect against higher rates and inadequate capacity.
- Have a positive attitude. Attitude is everything, and a poor attitude toward drivers will only result in poor reports to the carrier. Driver feedback is a bit part of determining shipper of choice status.
What Does It All Mean?
Higher driver turnover in 2019 will be inevitable. With less than two months remaining in 2018, the best thing carriers and shippers can do today is to work on reducing the burden and stress on drivers. Drivers are living, breathing people, and they deserve to be treated fairly by both their employers and shippers.
Follow the tips in this article, and start working to build better relationships in every interaction you have with truckers.
Related Article: Why Less-Than-Truckload Is Moving to Dimensional Based Pricing
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