Overdrive Magazine | Trucking Business News & Owner Operator Info
Issue link: http://read.dmtmag.com/i/87831
Has your carrier increased any aspect of pay within the past year? Though analysts continue to note mostly upward trends in owner-oper- ator pay over the last few years, this OverdriveOnline.com poll's results suggest otherwise, with nearly 80 percent of operators reporting either no increase or negative pay movement within the last year. No 64% 15% I'm paid percentage, rates are down or flat. readily translate to boosts in driver pay next year. Many carriers have begun to raise pay and take other steps to improve retention, Klemp says, but "pay will have to continue to improve to keep the good people." All the carriers Overdrive talked to agreed with that sentiment. Drivers and leased owner-operators with Trimac Transportation, Dart Transit, RWI Transportation, Fikes Truck Line, Marten Transport, America's Service Lines, Old Dominion and D&T Trucking, among others, report rela- tively recent pay increases. Supply is on your side With per-mile pay generally stagnant until recently, there hasn't been a large number of new people coming into the trucking business, Klemp says. And "a tremendous number have retired over the past decade," he adds. Of the year 2000 driver pool, "36 percent will be retired by the end of this year," representing "a huge number to be replaced." From 2007 to 2010, he says, the industry in aggregate "essentially replaced none of them." Reacting to this dynamic, carriers in a position to do so have sweetened sign-on deals and boosted pay. Klemp reports a $12,000 sign-on bonus as the highest outlier in his carrier pay pack- age data. Other anecdotal reports have shown figures of $15,000 in the recent past. At Illinois-based Nussbaum Transportation, says CEO Brent Nussbaum, "five years ago our turn- over was 60 percent a year. Today it's 30 percent." He attributes that not just to company culture at the 210-truck dry-freight carrier, but to action on one of the biggest problems in the indus- try: "We've always felt that driver pay should be higher than what it is." The company increased owner- operator per-mile base pay 3 cents in 2011 "and another penny this year," Nussbaum says. In addition, after taking a pay cut during the depths of the recession with a move to household goods miles from practical miles, Nussbaum-leased owner-operator Homer Kaiser says pay is back to a practical miles basis. And, Kaiser adds, equipment changes paid for by the carrier have yielded what amounts to a further pay increase with a boost in fuel mileage. "I'm gaining at least a mile a gal- lon from what I was running," says the owner-operator, who's been leased there 4% Yes, substantially. 3% Not sure. Yes, minimally. 10% I'm paid percentage, rates are up. 4% for seven years, with the addition of side skirts and trailer tails to company- owned dry vans fleetwide. Today, Kaiser is up to a 7-7.25 mpg average in his 2006 Volvo, powered by a Cummins ISX15. That boost in fuel mileage for an owner-operator running 120,000 miles a year amounts to saving $11,400 a year. Nussbaum says driver pay is up about 9 percent from early 2011, well above the national average increase for vans. Top pay for top standards Also putting upward pressure on pay is carriers' increasing need for the highly qualified driver, as management of new dynamics like CSA rankings becomes more important to maintaining freight levels and getting new business. Says Melton Truck Lines Safety Vice President Angie Buchanan, "We've struggled with how to pay for a higher qualified driver. How do you pay for a good CSA score?" The 1,000-power- unit, company driver-dominated flatbed carrier has tossed around different ideas but ultimately settled on what Buchanan calls "rewarding drivers for doing the right thing." Among other boosts in the pay pack- age – an added cent to 2 cents a mile for all drivers, two increases in detention pay over the last two years and other perks – a new fuel-mileage-performance bonus for high-efficiency operators is delivered in the form of a base pay November 2012 | Overdrive | 19