Trucking Firms Raise Pay To Keep Moving

by Marty Cook  on Monday, Aug. 11, 2014 12:00 am  

Maverick Transportation opened its new $4 million driver training center in late July in North Little Rock. | (Photo by Wil Chandler)

“We are all sharpening efforts on retention and recruiting,” Beckham said. “There’s 1,000 different ways to recruit drivers.”

ABF Freight, the largest subsidiary of ArcBest Corp. of Fort Smith, doesn’t have the same pay issues as some of its nonunion competitors. ABF Freight had second-quarter revenue of $492.9 million and its drivers’ cost is stable thanks to a labor agreement with the Teamsters.

During a conference call July 31, ArcBest CEO Judy McReynolds said the company had some production problems because the increase in overall shipping nationwide had put stress on the company’s docks. The company hired new workers to handle the increased workload, but the inexperienced workers were 20 percent less efficient, McReynolds said.

ABF’s Teamsters, who are already better paid than average even after making wage concessions last year, got a 2 percent raise at the start of July, and the stable workforce results in about a 4 percent turnover, excluding retirement. Compare that to Maverick’s 62 percent turnover and a national average near 100 percent.

Brad Delco, a transportation analyst with Stephens Inc. in Little Rock, said the increase in freight shipments nationwide is a sign that the economy is continuing to improve. The economy’s continued improvement will only make the driver shortage more acute.

Delco said he predicts nonunion truck companies may have to raise wages 4 to 6 percent.

“One of the staggering statistics [of USA Truck’s report] was unseated drivers,” Delco said. “That’s a large percentage of their fleet they don’t have drivers for. That’s putting a crimp on capacity.”

Beckham said pricing has increased and that increases in revenue should help with wage adjustments while not hurting the industry’s customers, and, indirectly, consumers. Beckham said raising prices to ship bread, for example, shouldn’t cause Wal-Mart to boost the cost of bread.

“The distribution costs for manufacturers or retailers are significant but they’re pennies on the dollar,” Beckham said.

If the economy continues to improve, then the trucking industry will face other pressures on driver retention. A better economy means more jobs in fields such as construction, which will suction off drivers.

Williams said truck driving isn’t an easy, glamorous life, which is why part of his training program at Maverick is having experienced drivers teach the “nuances” of the driving life to new drivers. P.A.M. Transport Services Inc. of Tontitown and Maverick pair new drivers with tutors on early trips to ease the introduction to the trucking life.

“Drivers are on the road 25 nights a month,” Beckham said. “They make decent money but, for the lifestyle, it’s not enough.”

 

 

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