Dive Brief:
- Ozark Motor Lines and Smokey Point Distributing, which is part of Daseke, are increasing driver pay to mitigate driver turnover, Transport Topics reported.
- Ozark will provide 41 cents per mile for line haul drivers with less than one year of experience, while drivers with the most experience will be paid up to 48 cents per mile. Smokey Point is nixing per mile compensation and is offering a $65,000 yearly salary for experienced drivers.
- The news comes as more trucking companies increase driver pay to improve morale and retain talent in the midst of a tight capacity market and unpopular new regulations like the ELD mandate and the Denham amendment.
Dive Insight:
Trucking companies already struggling in such a tight capacity market can't afford high driver turnover rates, which are above 90%. Earlier this week, Truckonomics CEO Myron Manuirirangi told FreightWaves that the only way to retain drivers in the current market is to pay them more.
A month ago, Cartage Company increased driver pay by 30%. On average, the American Trucking Associations said driver pay is up 15%.
But not all pay raises are equal: switching to a salary could be better for truck drivers in the long run because it disincentivizes them from logging long hours, which allows them to get more rest and then be more productive. Sleep apnea still plagues the trucking industry, causing accidents and reducing productivity and morale.
Salaried drivers would be less inclined to push themselves to the physical limit, and could end up enjoying their job more. Then the turnover rate would decline, and the industry may stabilize.
