Companies pile on perks to keep drivers truckin'

LODI, Ohio Fri Aug 10, 2012 10:10am EDT

1 of 16. A truck driver selects food from a lunch buffet inside a TA Truck stop in Lodi, Ohio July 9, 2012.

Credit: Reuters/Aaron Josefczyk

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LODI, Ohio (Reuters) - Truck stops are getting a makeover as companies add amenities to combat a growing shortage of a precious commodity: drivers.

On a blistering July afternoon, truckers at TA and Petro stops in Ohio played basketball, cooled off in a 60-seat theater showing Robert Downey Jr and Jude Law in "Sherlock Holmes" and had their blood pressure checked by nurse practitioners.

TravelCenters of America, which runs TA and Petro rest stops, and other truck stop operators have spent millions of dollars over the last two years on jogging trails, gyms, clinics, private showers and healthier menus in a bid to enhance driver loyalty and keep the country's 3 million truckers on the road.

Trucking companies are conducting a parallel campaign. Worried they cannot afford pay hikes big enough to retain experienced drivers and entice new ones, Con-Way Inc, Ryder System Inc, Swift Transportation Co and others offer perks and cushier sleeper cabs to improve the job's quality of life.

"Probably the number one thing is pay, but the showers and other amenities and restaurants are all fantastic," said Toney "ZZ" Murr of Brevard, North Carolina, who has been driving for more than 30 years.

Jobs in construction paid an average of about $45,000 last year, and electrician salaries averaged $53,000, compared with about $40,000 for heavy- and tractor-trailer truck drivers, according to Bureau of Labor Statistics data. Average driver salaries, based on government data, rose 0.5 percent to 1.5 percent annually over the past three years.

Keeping enough drivers on the road is critical for the industry, which moves about two-thirds of all freight in the United States. But a shortage of drivers, already approaching 100,000 truckers, is deepening even with U.S. unemployment over 8 percent.

By the end of next year, the shortage could more than double to 250,000, according to Noel Perry, principal of research firm Transport Fundamentals in Cornwall, Pennsylvania.

"That would just put us on the edge where you would get occasional spot shortages where freight wouldn't move," Perry said.

Many older truckers, who stretched out their careers in the recession, will soon retire; and the grueling hours and isolation hold little appeal for a younger generation, who favor jobs close to home that often pay better.

"Driver pay hasn't kept up with the skills, long hours and less-than-ideal living conditions," said Todd Fowler, KeyBanc Capital Markets transport analyst in Cleveland. "The current generation is going to college to work at Google and Facebook, and going to trade school to become plumbers and electricians."

Some drivers will give up life on the road to return to higher-paying jobs in construction, or take jobs in technology or the trades. The boom in the hydraulic fracturing industry, which needs drivers to move heavy equipment to drilling sites, adds to the overall shortage.

Impending rules that weed out unsafe drivers and cut allowable driving hours will reduce productivity, forcing companies to hire more drivers to move the same amount of freight volume.

"Companies are trying to think ahead around how do they plan for this (shortage) and remain viable and not put themselves in a position where they cannot support their end customers and continue to grow," said Scott Perry, vice president of supply management with Ryder's Fleet Management Solutions division.

RAZOR-THIN MARGINS

Thousands of trucking companies folded during the recent recession, and most survivors are running razor-thin margins.

The companies are eking out profits by pushing small rate hikes to shippers that offset higher costs, including gradual wage increases, fuel and new trucks.

Over the past year, earnings for "truckload" carriers, which haul loads for a single customer from pick-up to the final drop-off, have increased 8 percent, but remain about 30 percent below the pre-recession peak, said Fowler.

Trucking industry analysts say it would take double-digit pay increases to make a serious dent in the high turnover rates.

"Unless customers are willing to give us more money for carrying their freight, we can't give our drivers any more increase, because we have to make a profit in order to stay in business and recapitalize the business," said Bert Johnson, vice president of human resources at Con-way Truckload, a division of Con-way in Joplin, Missouri.

Con-Way Inc shares skidded last week after the trucking company reported weaker-than-expected quarterly profits.

COMFORT CUTS TURNOVER

Without significant wage hikes, perks that make long-haul truckers feel more at home and less likely to bail on their employer are essential, say drivers and industry experts.

More than 90 percent of truck drivers leave in their first year, either to go to a competitor, start another career, or are fired, according to Bob Costello, chief economist for the American Trucking Associations. If a driver makes it through the first year, the turnover rate falls by half, he said.

Weeks at a time on the road away from friends and family can make a long-haul trucking career a tough sell.

Long-haul truckers spent about 22 nights each month in their vehicles last year and drove 120,000 miles in 2011, on average, according to Readex Research.

Companies are starting to hire husband-and-wife teams and allow drivers to bring pets to ease the lonely time on the road. Women make up less than 5 percent of all drivers, according to the American Trucking Associations.

The sedentary lifestyle and fast-food culture also take a toll on truckers' health.

Mike Armstrong, a driver based in Camden, South Carolina who said he has borderline high blood pressure, stopped at the StatCare clinic in TA's Lodi rest-stop to have his pressure checked while his rig was being repaired.

"A lot of the guys are obese and they also need to get these checks done and don't realize the importance of it," he said. "My mom was a diabetic and had heart problems, so it runs in my family." He said he plans to make full use of the gyms, jogging trails and clinics.

Armstrong also likes the bigger cabs that truck companies are now buying for their fleets. "I just can't see staying out two or three weeks in those little-bitty cooped up things."

New trucks in the fleets of Con-way Truckload, Ryder and others are also sporting GPS, Sirius XM satellite radio, DVD players and satellite dishes.

Con-way Truckload for the first time is having drivers test trucks from various manufacturers and seeking feedback. It recruits in hard-hit cities like Detroit, reimburses tuition for new drivers who take training courses, and allows drivers who are farmers to resign during planting season and rejoin without losing seniority.

All of these initiatives are helping lower Con-way Truckload's turnover rate to about 60 percent from 70 percent a year ago, said Chief Operating Officer Saul Gonzalez.

Swift began a quarterly performance pay bonus in July to "retain and reward drivers" with up to 6 cents extra per mile.

Driving students are also hotly pursued. "Competition is so fierce that most of my students have between three and eight job offers before they start class," said Kreigh Spahr, who runs the two-month program at Cuyahoga Community College in Euclid, Ohio.

CHICKEN FRIED STEAKS AND CLINICS

Companies that dominate truck stop business all have invested in the past two years on extras.

Pilot spent $135 million on upgrades to showers, restrooms, delis and restaurants after taking over Flying J in 2010, and plans to invest $49 million more by the end of 2013.

TravelCenters, the only publicly traded truck stop operator, spent $171 million in 2011 and $40 million in the first quarter on upgrades.

"Don't get me wrong, we make a delicious Chicken Fried Steak and we sell as many candy bars as anybody," said TravelCenters Chief Executive Tom O'Brien. "But driver needs and demands are changing pretty rapidly in response to trends in health and awareness of wellness as well as regulatory issues."

TA does not break out revenue from new amenities, but the spending may be paying off. Total revenue rose to $7.9 billion in 2011 from $6 billion in 2010 and $4.7 billion in 2009.

(Reporting By Lynn Adler; Editing by Patricia Kranz)

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Comments (7)
paintcan wrote:
This would be a good time to consider reviving rail freight if not for the fact that origins and destinations of deliveries are impossibly more diffuse now and the ROWs are discontinuous and encroached upon by abutters and/or conversion to biking and recreational use. It was a far more fuel and labor efficient way of moving massive amounts of freight and passengers. One or two Diesel engines could pull hundreds of cars. The gradient was actually easier than the interstate highway system. It was also a more compact infrastructure to maintain than millions of square miles of pavement and related structures. The noise pollution was more intermittent that the constant roar of millions of tires on asphalt and concrete. A major highway always sounds like a roaring river in flood stage. The drivers don’t notice and the abutters must be stupid or deaf. I think it is the former actually. You can never underestimate the sheer sensory dullness of the modern consumer.

Steel can be recycled while tires seem to be more difficult to dispose of or recycle. Freight and passenger vehicles could last decades while private vehicles seem to have a much shorter life.

Many countries of the world still use and have greatly upgraded their passenger and freight rail systems but the US stupidly threw it away during the last 50 years in favor of “call me baby driver” and the suburban tract development. Fear of Nukes?

BTW – A glance at Google earth in China a few months ago revealed a train-like truck that appeared to be several flat bed trailers towed by a single cab. They can evidently do that because the truck shared the road with very few passenger vehicles. They may be thinking twice about building cities that have to dedicate so much open space to parking and ROWs.

Unfortunately (maybe not, now that it has entered its terminal fascist years) this country sqwandered its open space and natural environment to sprawl and traffic congestion and now the central government is too broke to consider massive planning and development ventures.

I can’t quite imagine a day when private firms will ever be able to cut through miles of suburbia to revive or carve new ROWs. They had the easiest time of becoming established when the country was compact urbanism surrounded by farmland. I suppose, as the “greatest generation goes to its grave and leaves the underwater tract house to their kids, the suburbs could loose value and make it easier to condemn by ED?

The rust belt is still rusting and thousands of acres of former residential space is opening close to urban centers, apparently, but it is all surrounded by suburbs. So it isn’t going to happen any time soon if it could happen at all.

Contrary to popular opinion the US is not the most innovative of market economies. It is actually quite primitive and inert. The future of urbanism will be characterized by rotting stick built houses that have high fuel costs, inconvenient and expensive access to services and millions of miles of roads that will never be cheap to maintain.

The rest of the world will have the efficiency and lower costs built in while we will rot in our lily pad (more flattering than calling it pond scum) urbanism.

Note to the developing world: Don’t buy a car if you can help it. They are a pain in the butt and the wallet.

Aug 12, 2012 8:07am EDT  --  Report as abuse
uc8tcme wrote:
The industry should recruit the military veterans. This would be a great “transition” job for our returning military veterans – I have a friend that drives he starts the good pay and the ability to get home more and in some cases you can make your own hours.

Aug 12, 2012 8:10am EDT  --  Report as abuse
cranston wrote:
Long distance trucker have driven our nation right out from under us. They are the the foot soldiers in China’s invasion of our nation. Beyond that they are the reason for the premature aging of our roadways – running excessive loads into local areas that would better be served by rail and automatic delivery. The truckers, rather than being ‘Knights of the Road’ as they used to be, have become a danger and a problem. There are too many of them.

Aug 12, 2012 8:38am EDT  --  Report as abuse
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