Looking for new strategies or new approaches to your driver compensation programs this year? With a challenging freight environment persisting amid a still-strong labor market, fleets often are walking a tightrope the past 18 months, trying to balance the need to attract and retain their most valuable asset — professional drivers — with the need to maintain profitability while waiting for the freight market to rebound.
With that backdrop in mind, NTI’s team of experts has assembled this list of four driver pay resolutions for your fleet to consider this new year and beyond:
Find pay strategies that reward drivers and also cut your fleet’s operational costs
Entering 2024, the freight market is still grasping to find its footing. Freight volumes have remained stagnant and still haven’t found any upward momentum after falling off in late 2022 and through the first half of 2023. While capacity has been exiting the market, the freight market is still out of balance. Thus, freight rates on both the contract and spot markets still haven’t entered a recovery period or upward cycle.
With the freight market still trudging through this down cycle, fleets have a keen eye on controlling costs — including those related to driver pay. Base hourly and mileage pay saw slight increases in 2023. However, driver turnover remains elevated, driver hiring activity remains higher than in 2021 and in 2022, and preventing driver dissatisfaction with their take-home pay remains critical for fleets of all types, particularly as fewer miles and hours available to drivers could chip into their paychecks.
How can your fleet balance all of that in 2024? By finding and implementing the right incentives that not only help bolster drivers’ take-home pay, but that also lead to lower expenses for your fleet.
Those include but are not limited to: fuel network compliance and fuel-mileage incentives, productivity and safety incentives available as milage add-ons or flat-rate bonuses, performance bonuses, and referral bonuses available to drivers for recruiting on behalf of your fleet.
Last year, NTI explored Six Driver Pay Strategies to Excel in a Down Freight Market, and those all still apply as fleets enter 2024. See those strategies here.
Invest time and resources in internal marketing programs to your drivers
Make 2024 the year your fleet puts intentional and consistent effort into developing robust internal marketing programs to connect with drivers and as a major boon for your driver retention efforts. That includes consistently communicating with drivers about what’s happening in the freight market and all of the opportunities available to them to earn the incentives spelled out above.
One area that NTI consistently coaches fleets on in their recruiting and retention programs is to never stop recruiting — or ABR, Always Be Recruiting. What does that mean? Don’t stop selling and re-selling your company to drivers once they join your company and once a truck is seated. With all channels available and appropriate for you — email newsletters, blog content, text messages, social media, internal communication platforms, driver apps — connect, engage, and communicate with your people to remind them of their value to you and to promote your company as a place where they can thrive and work their entire career.
In 2024, resolve to not only build these vital internal marketing campaigns, but use them to promote all forms of compensation available to your drivers and help them maximize their compensation through all of the pay incentives offered at your company.
Work to mitigate drivers’ unpaid and unproductive time
Unpaid and unproductive time like layovers, detention at shippers and receivers, traffic congestion, weather delays, and simply fewer miles, loads, and hours available to drivers cuts into their take-home pay and can sow seeds of dissatisfaction and resentment.
This unpaid, unproductive time not only pushes drivers away from your fleet, it also is a consistent catalyst for drivers to leave the industry outright.
This year, make tackling this unpaid, unproductive time outside of drivers’ control a priority at your fleet. Find ways to mitigate these instances across drivers’ schedules from an operations and management standpoint, and ensure you have answers for issues like detention, layover, deadheads, and other issues that lead to unpaid working time.
Maintain presence with the next generation of drivers
No matter what dynamics surround the freight market — through good seasons and tougher seasons — your fleet and the industry at large still need drivers. Like all other freight cycles behind and ahead, this too shall pass, and fleets and the industry at large shouldn’t abandon the commitment to the future of the industry because of this present cycle. Many companies have pulled back from investments in training programs and partnerships with CDL programs because of a perceived lack of ROI. However, what’s happening is the pipeline of drivers has been drained, and those who may have been interested in trucking careers have invested themselves in other industries. This dynamic will only come back to haunt when the market rebounds and there’s a resurgent need in driver hiring.
In 2024, despite the sluggish freight market and challenging rates environment, resolve to buck this trend at your fleet and keep an eye on the years ahead by investing in outreach, training, and commitment to the drivers you’ll need tomorrow.