The impact of high turnover
The trucking industry powers our country. Without it, shelves would be empty and we wouldn’t have access to nearly anything we need or use on a regular basis.
It is clear truck drivers are important. Aside from the driver shortage already plaguing the industry, another major concern is the high turnover rate. At around a 90% turnover rate for large fleets, it is one of the highest rates in the country.
Generally speaking, people often associate turnover with leaving the industry. When it comes to truck driving, however, that’s not the case. In a majority of cases, turnover in the trucking industry means switching companies. The kicker to all of that- in 2021, carriers lost about one new driver for every twenty they hired IN THE FIRST SEVEN DAYS.
Turnover happens in every industry for various reasons. Truck drivers are in such demand that companies are incentivizing drivers to come work for them with huge sign-on bonuses and more competitive pay. In 2016, about fifty percent of companies were offering sign on bonuses that averaged around $2,000. It peaked in 2018 at 61% with a bonus of about $3400. Last year, wasn’t too far off from that peak- 60% of companies offered sign on bonuses that averaged almost $3300. Companies like Wal-Mart offered $8000 sign-on bonuses in 2021.
What does high turnover in the trucking industry mean for all of us?
It’s pretty simple- higher prices. Companies are losing a lot of money to turnover. The recruiting, hiring, training, and bonuses associated with hiring new truck drivers doesn’t come cheap. It costs thousands of dollars that essentially get thrown out the door when the driver quits for a new sign-on bonus. Companies don’t take on this cost without passing it through the supply chain, ultimately ending up to the consumer with higher priced goods. I think we are all feeling the higher prices at this point.