Paying by the mile isn’t fair or safe
The practice encourages truckers to speed and results in unpaid time on the job.
The trucking industry is in crisis for one simple reason: It cannot find enough people to sit behind the wheel.
The American Trucking Assns., a trade group, estimates that trucks carry more than 67% of the country’s total freight by weight. Trucking is the nation’s most important mode of commercial shipping.
Currently, there are about 3.5 million people with commercial driver’s licenses, and 2.6 million drivers are on the road, according to the U.S. Bureau of Labor Statistics. That may sound like a lot, but the ATA and others estimate that we’re short 35,000 to 40,000 drivers, and they believe that shortfall will expand to 240,000 drivers by 2022. Many carriers have trucks sitting idle because there’s no one available to drive them; many want to buy new trucks but won’t do so for the same reason. Carriers need more operators to fulfill shipper requests not only as the economy expands, but also as it stands now.
The shortage is most acute in long-haul operations. However, it is now affecting short haul and regional carriers as well as drayage trucks that do short hops between, say, a rail- head and a nearby port. The driver shortage also hurts other transportation modes such as ocean shipping and rail, which rely on trucks to carry their freight “the last mile.”
The industry has tried to mitigate the shortage by offering drivers signing bonuses and shorter routes so they can be home more often, paying the cost for commercial driver’s license training, reaching out to ex-military, women and immigrant groups, and paying more for tenure. Carriers say these incentives help only incrementally and the shortage is not abating.
There are several reasons for the shortfall. First, drivers are older, on average, than the general working population, 49 versus 41.9 years, and many are retiring because they can no longer keep up with the physical demands of the job. Young people are not signing on to replace the folks who are leaving.
Second, federal regulations have cut back on the number of hours that a driver may spend behind the wheel, so additional drivers are needed to pick up the slack.
The most important reason, however, becomes obvious if you ask drivers directly. They’ll say the problem is how they get paid. Not how much, but how.
Consumers may not realize that drivers are paid by the mile and not the hour. This means that they make no money for sitting in traffic or waiting at a warehouse.
It is not uncommon for a trucker to pull into a warehouse a few minutes after it closes and sleep in his truck until it opens the next day. This is time on the job but not money in his pocket. As one driver told me, “Because payment is by the mile, warehousers and others don’t respect drivers’ time. Any inefficiency in their operation — and even from my own carrier — is soaked up by the driver at no cost to anyone else.”
Paying by the mile is both unsafe and unfair. It encourages truckers to speed in order to make money. Getting paid by the mile, moreover, means truckers never know how much they will make for any given week (they can’t predict breakdowns, traffic, weather or manmade delays at warehouses). Drivers report that inconsistent pay is even more of a drawback than low pay.
While the simple answer is to pay drivers by the hour instead of by the distance traveled, carriers are reluctant to do so because it would mean a dislocation of their business model, which dates to the 1930s when the trucking industry looked very different than it does today. President Franklin D. Roosevelt exempted trucking from the Fair Labor Standards Act, which mandated a minimum wage.
I have found only one carrier that pays by the hour, Dupré Logistics in Lafayette, La. Started as a tank truck hauler in 1980, the company has 1,200 drivers and 600 trucks. About 15 years ago, the company realized that even though it was following the rules governing how many hours a trucker could be on the road, its drivers were fatigued, and therefore accident prone.
“We were compliant, and we were legal, but we weren’t safe,” Reggie Dupré, the company’s chief executive, told me. To keep drivers alert, the company moved to a schedule that would allow them shorter stints on the road. And to save drivers from losing income because of the new scheme, the company decided to pay by the hour instead of by the mile.
Dupré reports that the company’s crash rate plummeted. Dupré also says the company has attracted experienced, reliable drivers. People want to work for there, and it has no shortage of applicants. The company’s driver turnover hovers around 17% in an industry where more than 90% is common.
The Centers for Disease Control and Prevention estimated in 2012 that fatal crashes of large trucks and buses cost the U.S economy $40 billion that year. Fatigue and speeding are major crash factors. It’s better for everyone if drivers don’t have to engage in dangerous behavior just to clock more miles, in the name of simply making a living.
Larry Kahaner is a writer who has been covering the transportation, trucking and logistics industry for more than 20 years.