Just a few days after the calendar flipped to 2024, we held this year’s inaugural Payday! with Leah Shaver show on SiriusXM Road Dog Trucking Radio. That’s the show we host monthly, and it’s a live call-in show where we field calls from drivers to help them navigate questions about their paychecks, compensation, HR and legal issues, life on the road, their relationships with their fleet employers, and so much more.
It’s one of my favorite hats I wear in our industry, and that’s because we get to have honest, authentic conversations with our professional drivers about the issues most important to them.
On that show earlier this month, two clear themes emerged in those conversations with drivers. First, a mix of questions from truckers at for-hire fleets who wanted to talk about the current down freight market cycle, how it had impacted their earnings, and when conditions might improve and alleviate some of this strain. Second, we heard from several drivers at private fleets and dedicated carriers operating confidently in their jobs and expressing satisfaction despite the market flux.
Corollary to the themes of the Payday! show, in the past few weeks at NTI we have held a flurry of conversations with recruiting and HR leaders, compensation managers, operations teams, and C-Level executives about what’s on their minds as we embark on this new year. Again, the same two trends have emerged in those conversations. For-hire fleets are working hard to manage the questionable freight cycle while awaiting a rebound, which has translated to muted pay gains for drivers and productivity losses that have chipped into drivers’ paychecks. Meanwhile, private fleets and dedicated carriers are taking an active, highly analytical approach to their driver compensation, recruiting, and retention programs to intentionally grow their fleet and excel through any market cycle.
Basically, for-hire carriers are taking a wait-and-see approach to driver pay decisions, while private fleets are analyzing every pay attribute to ensure it’s competitive in the markets they operate and so that drivers walk away with a deeper understanding of their pay and that they’re being paid for all of the work they do.
It’s with that dividing line, recognized by both drivers and their fleet employers, that our 2024 driver pay outlook has to begin. No matter which side of the line your company falls — wait-and-see or active analysis — everyone in our industry recognizes that the bottom line is directly connected to seating trucks with safe, qualified drivers and retaining them for the long term.
With that in mind, I’ve sketched out my thoughts below on what to expect this year around driver compensation trends, as well as driver recruiting and retention shifts, along with some notes and tips for your fleet to consider as you navigate another year of uncertainty and change. We’ll also be rolling out our 2024 Driver Market Forecast in the coming weeks, which will include our forecast for pay changes this year. Stay tuned for that! In the meantime, let us know if you have any feedback on the points below — as always, we’re all ears: email@example.com.
Retention is still key: Apply a keen focus on your fleet’s retention programs this year
Commit and re-commit your company and every department in your organization to driver retention efforts this year. The weight of healthy, ongoing communication with your drivers (and everyone within your company) cannot be ignored. Lean heavily on your internal marketing efforts to remind drivers why they chose you, what they like about you, and why they want to stay with you. Drown out the noise of all of the competitive fleets around you trying to entice your drivers to leave.
Thinking about those conversations on Payday! earlier this month, the concerns of for-hire fleet drivers tells me that communication remains so vital. Communicate both internally and externally about what’s happening in the freight market, what your company is doing to navigate it, and how drivers can take advantage of programs like safety bonuses, fuel incentives, performance pay, and more to help offset productivity losses that impact their paychecks.
Renew efforts around training and development of the driver candidate pool
Despite how grim the market can feel right now, the macro labor market is still historically tight and the constraints facing the driver population are long-term, secular trends that are calcified in our industry. The driver population continues to age out or wear out, despite what feels like a more robust driver supply at the moment, and opportunities outside of trucking remain plentiful for our driver pool.
Thus, it’s imperative that we focus on attracting, developing, and training the next generation of drivers. Otherwise, when hiring needs do ramp up again when the market shifts to a more inflationary cycle, we’ll wake up to a depleted pipeline of new entrants and struggle to hire the drivers we need. We’re hurting ourselves by pulling back from training programs, from partnerships with CDL programs, and from making intentional efforts to reach the next generation of professional drivers. Whether drivers come in younger or older or in their third career — it doesn’t matter. We can’t abandon our commitment to the future of our industry because of a moment in time. Remember, this too shall pass, and when it does, the need for newcomers to our industry will persist.
Reflect on what builds success with driver compensation decisions
The days of simply checking your fleet’s mileage or hourly rate against competitors once or twice a year and raising pay a few cents a mile or a few dimes an hour are fading quickly. Driver compensation decisions are growing increasingly more complex, analytical, and data-driven — and the pace of that change has accelerated in recent years. The most innovative and successful companies use driver compensation as a vital pillar of their recruiting and retention programs, and they analyze every single attribute of their driver pay package on an ongoing basis, often at the market level (aka the location where they’re hiring drivers).
The proof is in the pudding, too: The fleets who do take this highly granular, data-driven approach to their compensation planning see the most success in hiring the drivers they want, and they have very low turnover rates.
Also, private fleets and dedicated carriers have remained active in their hiring throughout the freight market correction cycle, and they’ve been active in hiring from the surplus of drivers in the for-hire market.
Consider restructuring your pay model
Simplifying your pay structure can make it easier for drivers to understand their pay and alleviate administrative burdens internally for accounting and operations teams. This is an area where NTI has been active in working with private and dedicated fleets in the past year. Some of the most innovative, and successful, fleets have sought to simplify how the structure and administer their driver pay packages, and they’ve reported strong results in transitioning to a model that rewards drivers for all time worked. Not only does it help stymie costs related to turnover and driver recruiting, but it also helps cut costs internally, even if the result means drivers take home higher paychecks.
Continue implementing robust mental and physical health and wellness programs
I saw countless comments on social media and in phone conversations at the end of last year about how 2023 was one of the toughest years in recent memory for folks. We never know what someone is going through, so be sure to check in with your people. Not just drivers, either. Make sure everyone in your organization — including and especially those managing your drivers — feels supported and understood. If your frontline managers are struggling with mental health setbacks, that will roll into your frontline workers.
Also, continue to prioritize physical health programs that support drivers’ journeys. Think smoking cessation programs, and educational programs about diet and exercise. We’ve covered those topics in-depth in the NTI Blog several times. Find those resources at this link.
Bonus tip for 2024!
Don’t forget to read our 4 Driver Pay Resolutions for 2024, posted in the NTI Blog this month. And subscribe to our weekly newsletter, NTI Alerts, to stay up to date on the latest driver pay trends, have a deep understanding of what’s affecting the driver market and driver compensation, and to read our tips and strategies for managing everything that comes our way this year.
From our team to yours, we wish you a prosperous, joyous, and fulfilling year ahead! ~Leah