Mileage pay and other benefits remain on the rise across the trucking industry as motor carriers seek more ways to recruit and retain more drivers to handle ongoing increases in freight demand.
Flatbed carrier Montgomery Transport recently instituted a one-cent-per-mile pay increase for all miles accrued by its drivers effective immediately, bringing up average annual pay to more than $62,000, with the top 10% of Montgomery’s drivers reportedly earning more than $71,500.
Additionally, new drivers joining the carrier are going to get more benefits through the carrier’s Road to Success package of “start-up” incentives. Thom Pronk, Montgomery’s human resources representative, said new drivers joining the carrier will earn up to $10,000 (up from $8,500) in incentive pay for achievable criteria such as orientation, time on the job, years of experience and safe driving.
The company stressed that it also offers other benefits such as weekly home time, comprehensive insurance options, and a 401(k) retirement account with employer match.
Estes Express Lines recently announced it’s making a “multi-million-dollar investment” in employee pay and benefits through a new program called the “Estes Care Package.”
The privately-heled LTL carrier noted that the “Estes Care Package” consists of four different employee-focused programs to be implemented quarterly in 2018 dubbed “Our Thanks, Our Future, Our Team and Our Heart.”
“Our Thanks” went into effect this week and is comprised of a bonus check given to all current Estes employees, who were actively employed as of December 31 last year.
“Our Future” expands the carrier’s existing scholarship fund for children of Estes employees attending a university or college. Estes said this “enhanced” scholarship program has amended guidelines that provide greater access and availability, with no limits on the number of annual scholarships awarded.
Finally, “Our Team” and “Our Heart” focuses on the “caring nature” of employees by helping them and communities in times of need in a structured fashion. “Our Team” provides for an employee assistance fund, giving employees grants to assist them in rebuilding their lives after devastating natural disasters and/or personal hardship, while “Our Heart” sets aside funds that enable employees to direct donations to national charitable organizations that mean the most to them.
“Our big worry is drivers, drivers, and drivers,” noted Rob Estes, the company’s president and CEO, during a conference call hosted by research firm Stifel Capital Markets late last month. “Today though the economy has gained a lot of dynamics; average shipment weight has gone up 100 lbs. and we need more drivers to haul the shipment volume we’re getting.”
He added that “acquiring and keeping talent is a challenge; smart people tend to grow restless and move on so we have to make sure we continue to energize and encourage our workforce. Looking forward, that will continue to be my worry list or excitement list, however you view it.”
The demand for drivers relates directly to the high volume of freight being tendered. For example, data tracked by load board operator DAT Solutions, showed that flatbed load posts increased 10.8% for the week ending March 10 while truck availability dipped 1% compared to the previous week. There were 88.5 available loads for every flatbed truck posted on DAT load boards, up 11% week-over-week. By comparison, DAT pointed out that flatbed load availability was at 61.8 a month ago and below 30 in November.
As a result, the national average flatbed spot rate hit $2.50 per mile for the week ending March 10, or 11 cents higher compared to the previous week. Houston was the largest market in terms of outbound flatbed freight volume, with available loads jumping 11.4% and its average outbound spot rate up six cents to $2.70 per mile.
After two weeks of rising volumes, the number of dry van loads slipped 0.6% for the week ending March 10, while truck posts increased 3.1%. The result was a mostly neutral week in terms of spot rates, with the national average spot dry van rate holding at $2.14 per mile, unchanged for the third straight week, with the dry van load-to-truck ratio down slightly to 6.8 loads per truck.
Refrigerated or “reefer” load posts increased 4%for the week ending March 10, while truck posts increased 5%. That caused the national load-to-truck ratio for reefers to decline slightly from 10.6 to 10.5 loads per truck and helped keep the national average reefer spot rate at $2.40 per mile for the second week in a row.
Yet all of those numbers are up significantly compared to last year, the company noted, and that upward trend has helped fuel pay increases for drivers and owner-operators alike.
For example, accounting and consulting firm American Truck Business Services (ATBS) recently noted that based an analysis of data collected from its more than 20,000 owner-operator clients, their average net income in 2017 exceeded $60,000 with their rate-per-mile pay increasing 5% on average from 2016, though average miles driven went down by half a percent.
“We’ve rebounded strongly from the freight recession of the last few years and 2018 is shaping up to be a record year for owner-operators,” says Todd Amen, President and CEO of ATBS.