It depends on who you ask, but most folks throughout the industry say it costs $5,000 to hire one professional driver. Other clients say it’s north of $10,000 to replace a driver. What’s with the spread?
A Closer Look at The Cost of Turnover
There’s only been one legitimate study conducted on the cost of hiring a driver. It dates all the way back to 2001. Upper Great Plains Transportation Institute published a paper called “The Costs of Truckload Driver Turnover.” The study obtained data from 15 companies who they interviewed in an effort to understand how much it costs to replace a driver and where the costs lie. They looked at everything: cost of advertising, staff wages, recruitment and orientation costs, training, and much more. Their study showed that the average cost of turnover for those 15 companies was $8,234.
In almost any other field, a study from 2001 wouldn’t hold-up as a credible source. How can something that’s nearly two decades old still have relevant data? If you look at what people are saying though - between $5,000 and $10,000 for driver turnover - eight grand splits the difference. Some of the variance comes down to what the company is hauling. For instance, it takes a lot more time and resources to hire and train someone transporting fuel or hazmat materials than it does to train someone that hauls dry goods. Many companies leave out the cost of a lazy asset sitting against the fence that’s not producing revenue while incurring costs and depreciation.
How Can You Cut Down Your Turnover Costs?
Regardless of the specific number, driver turnover is expensive for every trucking company. And it’s a pervasive problem. Industry turnover is about 90% nationwide. It’s clear that your success hinges on your ability to solve turnover. Big picture, there are two approaches you can take.
- Keep The Drivers You Already Have
Focusing on driver retention is an essential step towards solving your turnover problem. Your hiring efforts are futile if every driver you snag walks out the door in a matter of weeks. Long-term strategies are the most effective for improving retention, but you also need to take immediate action. For ideas on how to retain more drivers now and later, check out our ebook “75 Strategies to Help Increase Driver Retention.”
While you tackle your reading assignment, consider investing in leadership training. Our Leadership Development Course is made for frontline leaders in the transportation industry. It consists of more than a dozen online self-directed lessons that will teach your managers and supervisors how to improve driver retention. If you’d like to learn more, contact us today.
- Improve Hiring Efficiency
Increasing retention is a great start, but you’ll always be hiring. That’s why it’s important to improve your hiring efficiency to reduce your cost of hire. A great way to do so is with a driver-centric Applicant Tracking System (ATS) like A-Suite. An ATS will help you hire more drivers in less time. You’ll reach more candidates, reduce your time to hire, automate lead source tracking, and much more. If you’d like to schedule a free A-Suite demo, contact us today.