The American Trucking Associations (ATA) reported this week in its ATA Quarterly Employment Report that the annualized turnover rate for large and small truckload carriers was up in the third quarter.
The third quarter turnover rate for large fleets with more than $30 million in revenue increased 9% to 96%, which ATA said is the single largest quarterly increase going back to the second quarter 2016 and represents the highest figure going back to the second quarter of 2018.
For small fleets, the ATA said the turnover rate headed up 6% to 73%, marking a gain over the second quarter’s 67%, which is the lowest level, for small carriers, since 2011. Less-than-truckload driver turnover fell 4% to an annualized rate of 9%, which marks the lowest level since the fourth quarter of 2017.
“Counterintuitively, we saw turnover rise even as the freight demand was relatively soft,” said ATA Chief Economist Bob Costello in a statement. “While turnover rose at both small and large carriers, the reasons were quite different. Large carriers reduced the number of drivers they employed, in keeping with lackluster freight levels, but smaller carriers added to their driver pools, increasing their number of drivers by 1.9%. During the first two quarters of the year, larger carriers added drivers, but in the third quarter they started right-sizing their fleets. Conversely, smaller companies increased their driver pool in the third quarter for the first time this year.”
Despite the high turnover rate, motor carriers have been very aggressive in trying to ameliorate the current situation though efforts like raising driver sign-on bonuses, increasing pay, and providing financial aid options for potential drivers to attend driver training schools to get them their CDL licenses, among other things.
ATA’s Costello said in 2018 that anecdotally, carriers continue to struggle both recruiting and retaining quality drivers – leading to increasing wages, adding that the tight driver market should continue and will be a source of concern for carriers in the months ahead.
“Turnover is not a measure of the driver shortage, but rather of demand for drivers,” he said. “We know that as freight demand continues to rise, demand for drivers to move those goods will also rise, which often results in more driver churn or turnover. Finding enough qualified drivers remains a tremendous challenge for the trucking industry and one that if not solved will threaten the entire supply chain.”
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