Q4 annualized driver turnover rate comes in flat, reports American Trucking Associations

Following the second and third quarters of 2020, which saw annual significant gains, the annualized turnover rate for over-the-road truckload drivers, in the fourth quarter was flat, according to data issued today by the American Trucking Associations (ATA).

ATA officials said that the turnover rate for truckload carriers with more than $30 million in annual revenue remained at 92%, from the third quarter to the fourth quarter, following a 10% annual gain in the third quarter. And the turnover rate for smaller carriers, with revenue below $30 million, saw a 2% decline, to 72%.

For all of 2020, ATA said that the large truckload carrier turnover rate came in at 90%, which was down 1% compared to 2019, with the annualized average turnover rate for small truckload fleets was 69%, which was off from a reading of 72% in 2019.

The turnover rate for less-than-truckload (LTL) carriers, which ATA said is much lower than that of truckload fleets, dropped 2%, to 12%, for the fourth quarter. This marked a 1% decrease compared to the full-year 2020 LTL turnover rate, at 13%.  

“With the continued tightness in the driver market, it may seem surprising that the turnover rate didn’t jump in the fourth quarter as economic activity and freight traffic increased,” said ATA Chief Economist Bob Costello in a statement. “However, paradoxically, strong freight demand may have actually contributed to turnover staying steady by keeping drivers – particularly those engaged in the dry van and temperature-controlled sector—too busy to change jobs. With the impact of recently passed fiscal stimulus, and the quickening pace of vaccinations in the U.S., we are likely to see continued improvement in the economy which will drive not just healthier freight volumes, but are likely to create even more demand for drivers, tightening the market, so motor carriers need to remain focused on driver retention,” he said. While the driver shortage temporarily eased slightly in 2020 during the depths of the pandemic, continued tightness in the driver market remains an operational challenge for motor carriers and they should expect it to continue through 2021 and beyond.”

While market conditions are much different now, than they were prior to the COVID-19 pandemic, many issues related to driver turnover remain consistent.

For example, in early 2019, motor carriers took steps to be aggressive in trying to ameliorate the high turnover situation though efforts like raising driver sign-on bonuses, increasing pay, and providing financial aid options for potential drivers to attend driver training schools to get them their CDL licenses, among other things.  

And the ATA’s Costello said around that time that anecdotally, carriers continue to struggle both recruiting and retaining quality drivers – leading to increasing wages, adding that the tight driver market should continue and will be a source of concern for carriers in the months ahead.

“Turnover is not a measure of the driver shortage, but rather of demand for drivers,” he said. “We know that as freight demand continues to rise, demand for drivers to move those goods will also rise, which often results in more driver churn or turnover. Finding enough qualified drivers remains a tremendous challenge for the trucking industry and one that if not solved will threaten the entire supply chain.”