Retail giant Walmart highlighted its pay package for new drivers and a referral bonus program during a recent Truck Driver Appreciation Week.

Fleets upping, getting creative with driver pay

Sept. 18, 2018
Fleets are increasing driver pay, benefits, and incentives amid a booming freight market and continuing driver shortage.

There's high demand to move freight and goods, and good rates being paid to move it. And with the long-running and deepening driver shortage, fleets filling their driver's seats has become a constraint holding back the industry—and they're starting to "one-up" each other in showing drivers the money.

There's been an upward, or more appropriately, downward slide with driver turnover rising higher among large carriers, according to the American Trucking Assns. ATA reported a turnover rate of 94% in the first quarter of 2018, up 20% from the same time a year earlier.

That trend continued until just recently, notes Tim Hindes, co-founder and CEO of Stay Metrics, a driver engagement and retention solutions provider. The company has tracked a slight decrease in driver turnover among all carriers in the second quarter.

He speculates that it's because of more lucrative pay packages. One by one, fleets and trucking companies have been walking out significant driver pay increases and/or new benefits and incentives.

A few examples: 

—Last week during Truck Driver Appreciation week, Walmart highlighted driver pay programs where new drivers earn on average $86,000 annually—well above the industry-wide average—and get access to benefits "on day one." Drivers get up to 21 days of paid time off in their first year, according to the company, and enjoy perks like safety bonuses and other incentives.

Walmart also launched a referral program where drivers can get up to a $1,500 bonus for helping bring on another driver.

U.S. Xpress announced its "Full Ride" scholarship program last week where truck drivers can earn a bachelor's or master's degree from Ashford University at no cost "in one of dozens of disciplines ranging from business and logistics to accounting or behavioral science."

And that extends to drivers' kids. US Xpress drivers can enroll up to two dependents age 17-26 at one time in a bachelor's or master's degree program at Ashford. The "free degree" program extends to the trucking company's subsidiary Total Transportation of Mississippi, U.S. Xpress said.

USA Truck just announced higher regional base pay for its drivers as well as an expanded 20-year pay scale aimed at long-term driver retention. The company has also instated weekly productivity payments for drivers to reinforce its "Drive more, earn more" philosophy.

But USA Truck also has something to gain in the equation and is now offering a bonus of up to $0.06 per mile for safe operation, bringing drivers' earnings potential up to $0.525 per mile depending on location.

Atlas Van Lines recently put in place what it said is "the largest and most extensive" pay increase for drivers in its history. Average increases of $0.06 per mile and $0.10 per mile went into effect for the company's truckload and special commodities divisions, respectively.

Atlas also boosted pay for first-year drivers and is offering new incentives like an expanded fuel discount program and a number of policy changes that the company said should reduce its owner-operators' costs by nearly $10,000 a year.

Just a blip?

Driver pay increases are certainly becoming a trend, but whether they'll have a lasting effect in reducing turnover remains to be seen. The reasons for the driver shortage and increasing turnover, after all, aren't just that pay isn't high enough.

There's also the job itself and time that may be required to be on the road and away from home. There's the question of job security, with young workers thinking twice about getting into truck driving as they watch self-driving vehicles and trucks evolve and the driver job being automated.

But for now, when it comes to hiring and keeping drivers, it looks to be more strongly a buyer's market, and fleets and trucking companies need to sell the positions and compensation packages they're offering. 

"The market is changing," Stay Metrics' Hindes says. "Don't just assume those veteran drivers love you."

About the Author

Aaron Marsh

Before computerization had fully taken hold and automotive work took someone who speaks engine, Aaron grew up in Upstate New York taking cars apart and fixing and rewiring them, keeping more than a few great jalopies (classics) on the road that probably didn't deserve to be. He spent a decade inside the Beltway covering Congress and the intricacies of the health care system before a stint in local New England news, picking up awards for both pen and camera.

He wrote about you-name-it, from transportation and law and the courts to events of all kinds and telecommunications, and landed in trucking when he joined FleetOwner in July 2015. Long an editorial leader, he was a keeper of knowledge at FleetOwner ready to dive in on the technical and the topical inside and all-around trucking—and still turned a wrench or two. Or three. 

Aaron previously wrote for FleetOwner. 

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