In doing driver recruitment for companies across the country in the last 8 years or so, I’ve been able to keep my finger on the pulse of the driver pay ‘situation’, we’ll call it. I’ve seen zero pay reductions in those years and several pay increases (and more sign-on bonuses than I’d like to admit, unfortunately). In all these instances the statistics, percentages, and economic information given was usually given in relation to the current CPM (cents per mile) paid to any given driver. The metaphor I referred to earlier, was about the fall of just that: CPM.
In the graphic to the right, you can see that driver pay has gone up, albeit gradually. I’m sure many companies were not quick to give up every penny (literally) that was given to driver pay. You can see, however, that driver pay increasing is a direct result of a demand for freight. This is to be expected, but freight has been increasing alongside the economy and inflation for many years now. Driver pay packages have historically not kept pace with inflation.
In 2018, we are seeing far more companies stray away from the typical CPM pay structures in lieu of a ‘flat rate’ or ‘guaranteed pay’. When I say “far more companies” keep in mind I’m only able to use that phrase because so few companies have adopted those sorts of pay structures in the first place. We still seem to be a long way away from the industry accepting the dreaded ‘salary’ as the common-place pay type for professional Class-A drivers. So why is CPM finally getting tossed to the side for the favour of other pay types?
This is by far the biggest reason why CPM is quickly losing ground on other pay types. I have found myself making the following statement to nearly every truck driver I have spoken to regarding job opportunities: “It doesn’t matter how many CPM you’re getting if you’re not getting the miles. $5.00/mi. for 50 miles each week is still only $250.00!” Although that example is a bit brash, it gets the point across. If you are on a CPM pay structure you will never be ‘guaranteed’ any sort of minimum pay. Even if your employer is extremely efficient in optimizing each trucks’ usage, there will always be the chance that due to unforeseen circumstances (such as breakdowns, weather, etc.) that your pay is affected.
Why is this important? Here is some perspective: most people want a few simple things in life. Having a fulfilling career, being healthy, being safe, feeling loved (family), owning a home, etc. are just some examples. Class-A driving is a career. This means that people start as an inexperienced driver with the intention (not always but stay with me here) of possibly retiring as a Class-A driver. Most of the desires I listed above are significantly harder without a consistent paying job. Ever try to get approved for a mortgage when your last four-weeks’ of pay check’s look like this: $1400, $400, $550, $1000? Probably not because most people understand that they would not get approved. Why? Inconsistent pay.
The same could be said for hourly pay regarding consistency (just like any other hourly paid job). There are many Class-A driving positions that still pay hourly. Is hourly really the proper way to be compensating a Professional Class-A Driver? This brings me to my next point:
Professional Class-A Driving
The term ‘professional’ does not always precede ‘Class-A Driver’, and that is extremely unfortunate. In my opinion, being a Class-A driver requires a level of professionalism that most office jobs do not. I am not referring to professionalism with intercommunication or customer relations, either. What I am referring to is an overall level of ‘seriousness’ that is beyond that of ‘this is my job and I have to be on my best behaviour in front of my boss’. This seriousness is more of a ‘if I make a mistake today, I could kill someone’ type of seriousness. I understand that this is a dark route to take this explanation, but I feel as though it is needed to get the point across. If Mike the Manager makes a purchasing mistake, in most instances not too much will come from that interaction (some irate co-workers, maybe). If Teresa the Truck Driver forgets to check her brake lines for the connections and any potential air leaks, then we’re having a much different conversation…
The point I am trying to make, here, is that companies, drivers, and society alike are all beginning to understand that if they want a ‘professional’ driving their Class-A vehicles then they need to be treated as such in all aspects of the word; including pay. A business professional gets paid a salary, why shouldn’t a trucking professional?
This category is something that has enabled more consistent pay as of late. If there is more freight than trucks available to move it, usually trucks will have an easier time keeping the wheels turning. This also means that shippers are willing to pay a premium to guarantee that their freight is moved (can you guess what the key word is, there?). With guarantee’s come flat rates and a pay that is consistent.
This, however, is a more short-term catalyst enabling the advent of salaried professional Class-A driver pay. To look for a longer-term solution, we need to look towards recent technologies.
In 2017 & 2018, trucking companies and shippers have begun to allow for a greater sense of transparency throughout their operations. Some companies are only doing so internally for their company’s culture and operations, and others are doing so with their partners to strive towards an easier working relationship. In either instance, this transparency means a greater transparency regarding pay rates and structures. When all aspects of the supply chain are available to be perused by all parties involved, it allows for greater consistency in networks and more importantly load-to-truck ratio’s. This consistency then translates into a more consistent pay structure for drivers. Blockchain has been on everyone’s mind over the last year or more, and once fully implemented it could have a significant impact on how drivers (and carriers) are paid in the future.