Cost of Driver Turnover

Driver Retention

Transportation is the only American industry that regularly accepts 60, 70 and even 100 perfect employee turnover. If the manufacturing sector operated at the same level of employee retention that transportation does, there would no goods for truckers to haul to market. In spite of the high cost of driver replacement, the industry as a whole has done very little to address the issue. Consequently, a large portion of the profits of the industry is spent on replacing drivers. Many fleets have as much as 25 percent of their equipment out of service while the company looks for replacements for drivers that have quit. Production is down, profitability suffers and poorly qualified drivers are hired as stopgap measures. None of these situations is acceptable, and yet the industry continues to suffer. In order to improve driver retention, the underlying causes of driver dissatisfaction must be understood and solutions must be sought.

How can you keep your good truck drivers?

Trucking companies continue to experience a lack of available qualified drivers while cargo volumes increase. The industry demand is putting the squeeze on long haul operators who are resorting to paying top dollar or recruiting inexperienced drivers, both of which are not ideal solutions to the problem.

Maybe the best question is not ‘how can we find more drivers?’ but ‘why can’t we retain the good ones we have?’ This makes perfect sense when you read that recruitment and training costs for each new driver is estimated at between $5,000 to $10,000, and the chances of being involved in an accident are considerably higher as workers ‘learn the ropes’ in their new position.

So how do you retain your good drivers?

A study by the Upper Great Plains Transportation Institute placed the average cost of turnover per driver for all companies in their study at $8,234.00. Included in the analysis was the cost of entry and exit administration, fixed asset costs due to idle equipment, profit lost due to idle equipment, and other costs such as insurance, legal and equipment maintenance. These costs included:

  •          Cost of Advertising

  •          Staff Labor Costs

  •          Testing Fees

  •          Recruitment Costs

  •          Orientation Costs

  •          Training Costs

  •          Referral/Sign-On Bonuses

  •          Monthly Cost of Interest on Trucks and Trailers

  •          Monthly Cost of Depreciation on Trucks and Trailers

  •          Monthly Cost of Insurance on Trucks and Trailers

  •          Idle Equipment Formula

  •          Safety / Insurance / Legal

  •          Productivity Loss Due to New Drivers

Stated the UGPTI study authors, “Driver turnover has been a major issue in the truckload industry for decades. Turnover rates in excess of 100% are common. There are two types of turnover that happen frequently. The first type is when a person exits the industry – they quit driving. The more common type, however, is when drivers change jobs within the industry.”

What Incentive Works?

One way to cut these costs is by offering an incentive that best insures commitment, and retention. The Drive4College program offers a college degree for a committed driver. The degree is available to the driver to utilize for their own degree/career goals, or that they can obtain, then provide to the benefit of a family member’s education. College is a costly dream for most, and is increasing in cost. This is a “One of Its Kind” incentive that can be obtained through a truck driver’s invested time, and commitment in driving.

Retention Agreement 

Customized on case by case basis. College Scholarship Credit earned based on agreed period of time committed to driving the truck.