FOR IMMEDIATE RELEASE



Large Truckload Company Driver Turnover Up 6 Percentage Points
ALEXANDRIA, Va. – The driver turnover rate for large truckload and less-than-truckload carriers increased during the first quarter of 2007, marking their highest turnover rates since the end of 2005.



ATA, which began collecting driver turnover statistics in 1995, reported that turnover for large truckload carriers was at a 127 percent annualized rate for the first three months of the year. This figure was 6 percentage points higher than during the last three months of 2006. The group ended the quarter with 1.8 percent fewer drivers than it had at the start.



Large TL driver turnover posted a 116 percent annualized rate for the 2006 first quarter. Turnover peaked at 136 percent for large TL carriers during the 2005 fourth quarter.



“The softer freight demand contributed to the increase in large TL driver turnover,” said ATA Chief Economist Bob Costello. “Nearly 80 percent of the large carriers in our sample saw their number of employee drivers fall during the period. In some cases, the drivers that left were not replaced, due to soft and choppy freight levels.”



Small TL carriers saw the average annualized turnover rate drop to 102 percent from 112 percent during the first three months of the year. The small carrier turnover rate has been at least 100 percent for six consecutive quarters.



Small carriers added 3.5 percent to their driver ranks, marking the second consecutive quarterly gain in the number of drivers.



The LTL market, by comparison, reduced overall employment during the 2007 first quarter by 1.6 percent.



The American Trucking Associations is the largest national trade association for the trucking industry. Through a federation of other trucking groups, industry-related conferences, and its 50 affiliated state trucking associations, ATA represents more than 37,000 members covering every type of motor carrier in the United States.

 

Ok, I read this, just what exactly does it mean for the common driver? :wink:

 

It basically means three things

127% driver turnover among large companies means drivers stay an average on nine and a half months for various reasons. Some more, some less. Nothing really new there except that for all of 2006 the complete turnover was ten and a quarter months. So employees are quitting on average with three weeks less experience at a company than last year.

The big question there is how many of their replacements are coming in as experienced drivers. I suspect that at least half of that number are drivers who simply switch companies, not leave the industry entirely.

Small companies are growing, especially those with a niche market.

Shippers are realizing that they can get a better rate with truckload distribution, perhaps with a couple of stops. LTL carriers have overpriced themselves in the current market and I bet that will correct itself shortly.

Now as to what that means to the common driver: The big OTR companies are looking for drivers (nothing new there) but so are smaller and possibly better managed companies. If you want an LTL job now isn't the time to start looking for that.

 

What I see it as meaning is that the major and minor carriers, who are members of the ATA....have failed to learn how to correct their internal problems and correct the systemic errors in their sector of the industry in such a manner as to prevent driver turnover. In other words, they have basically proven once again that they either don't give a "flip", or are unwilling to make the decisions necessary to correct the existing problems, even though every time a driver quits and they have to hire a replacement, it costs them rough $7000.00.

Speaking of "management stupidity"???? :shock: :?

 

What is pathetically funny is that some major companies have spent hundreds of thousands of dollars trying to correct the driver turnover problem in the industry by hiring these focus groups/companies to come in and exam the problems and recommend changes.

Where it is pathetic is that they could have saved this money, and gotten better results, if they simply had asked drivers what needs to be done and actually listen to the answers.

It is my guess that if the $7000 it takes to hire a driver was spent on driver retention issues that the company would see at least an additional $3000 plus per year above that in productivity per driver, if not a lot more.

 

When you say that LTL is "overpriced" compared to truckload, you are inferring that LTL and TL compete against each other for the same freight. For the most part, that is not correct. Most of the freight that can be consolidated, crossdocked, pooled, aggregated, etc and put on truckload or rail has already been done so.

The only time an LTL and TL carrier compete in spot markets is in long-haul lanes (3-5 day transit times). In 1-2-3 short-haul lanes there is no competition and there never will be. In such cases, LTL has more in common with parcel carriers than they do with TL.

 

Bullseye!!!! Thats why I work for a small outfit, their only ad is on this site. Hard to get on here because of not much turnover. But they dont hire students only min 2 yrs exp. They run ad because of growth.

 

I wouldn't say that LTL company's have over priced themselves. Obviously it does cost more to use an LTL company because of a higher overhead. We are just simply not hauling the cheap freight so there is no growth in the LTL company's as a whole (most are cutting back). TL company's will haul the cheap freight and to make up for the cost difference they put more trucks on the road and continue to haul cheap freight. LTL company's can't haul all the cheap freight and keep adding more trucks because they also have to hire more drivers, dock workers, build bigger break bulks to handle the additional freight and more office support.

 

I agree, I don't haul LTL's anymore but the higher cost on some of it is the logistics an LTL carrier has to put up with load planning its a nightmare on some of those loads such as location and appts I can greatly see why they charge more. Then you have to have a backhaul. most of the drivers unload their own freight at the cust and I know why, on an LTL lumper fees by the time your empty can be tripple of a TL. It cost my co an average of $130.00 for a TL of meat to be unloaded by a lumper, If I have a 3 stoper which is about the most we do it can range anywhere around $300-$400 for the same amount of cases plus they pay us extra per stop. We are not allowed to unload anything,co policy, but I can see where the cost comes in.