The truck driver shortage is a real and pressing concern for the US economy. According to Statista, we’re currently in need of 80,500 more truck drivers than we have, and by 2030, it’s projected that we’ll be short a whopping 162,000 drivers. Many blame high turnover and low retention rates for this shortage, and on the surface, it appears as though they have a point. However, when you really dive into it, the two have little to do with one another. The staggeringly low truck driver retention rates we’re seeing aren’t proof that hordes of drivers are leaving the industry at all.
Calculating Truck Driver Retention And Turnover Rates
Turnover rates reflect the number of trucker drivers who leave a carrier or company over a specified period of time, including those who leave voluntarily and those who are fired or laid off. To calculate the turnover rate, divide the number of employees who left a carrier during a period by the number of employees at the start of the period, then multiply the result by 100. For example, if Carrier A had 300 employees in January 2021, and 60 employees left by January 2022, the turnover rate for that period would be 20%
60/300 = .2
.2 x 100 = 20%
Truck driver retention is the exact opposite of turnover; it’s the number of employees who stayed at a company during a set period of time. So, following the previous example, if 240 employees out of 300 stayed with Carrier A from January 2021 – January 2022, the retention rate would be 80%.
240/300 = .8
.8 x 100 = 80%
Why Is Truck Driver Retention So Low?
There are around 3.36 million truck drivers currently employed in the US, and in 2022, the average turnover rate for large fleets was 89%. Based on these numbers, that would mean approximately 3 million truck drivers exited their jobs, and if all of those drivers actually left the industry, that would leave a mere 370 thousand remaining. Even factoring in the additional 110 thousand new drivers expected to enter the industry each year, we’d still only have 480 thousand truck drivers left based on these numbers. If that were truly the case, the US economy would have fallen apart ages ago. The moral of the story is that truck driver retention and turnover rates are a bit misleading. Here’s why:
The Increasingly High Demand For Truck Drivers
High turnover rates don’t necessarily indicate that truck drivers are dissatisfied with their jobs, in fact, quite the opposite is true; it can be a sign of empowerment.
Sure, some drivers are terminated, some retire, and some leave to find a different occupation, but the vast majority of the time, that’s not what turnover is calculating. When most truck drivers leave their carriers, they aren’t leaving the industry altogether. Instead, they’re moving between carriers. Why is this, you may be wondering? Demand and opportunity. With so few truck drivers to fill so many positions, companies are increasing their benefits, compensation, and sign-on bonuses in order to attract quality drivers.
So, if a driver working for Carrier A sees that Carrier B is offering a sign-on bonus of $5,000 and higher annual pay, they may be enticed to switch. A few months later, if they see that Carrier C is also offering a sign-on bonus and better benefits, they may switch again. You can see how both truck driver retention and turnover can be conflated by multiple changes within the industry (rather than out of the industry).
Natural Career Progression
Another reason for low truck driver retention rates is that they don’t account for the natural progression of a truck driver’s career. Many drivers start out as company drivers for a carrier where they are typically paid by the mile as a contractor (not a W2 employee with benefits). A lot of drivers give up at this stage, which accounts for a portion of the turnover. However, most drivers simply move on to the next step in their career. In this stage, carriers encourage drivers to lease their own vehicle (and cover all the vehicle operating expenses) in return for a higher rate per mile and the promise that they will own their own company. Even more drivers drop off here. Finally, some drivers decide to start their own companies, operating under their own authority. Turnover for drivers in this category is likely much lower.
Other Reasons Drivers Leave
Self-insured large carriers have the capacity to train new drivers, which means that a great deal of the people they hire are completely new to the industry, and many of these newbies don’t stick around for long. They might be terminated for having too many accidents, they may not enjoy the unique lifestyle of a trucker, or they may not have realized how difficult the job is. For example, OTR drivers must be away from home for extended periods of time (the average OTR truck driver spends around 4-6 weeks on duty before coming home, often driving over 250 days a year, which can place a lot of stress on a family). For these reasons, turnover can be rather high for drivers in their first few years.
Pay Your Trucking Taxes With i2290
As you can see, a plethora of factors contribute to the high turnover of truck drivers, and in most cases, it isn’t an issue of drivers leaving the industry. However, that isn’t to say working as a truck driver is easy; that’s far from the truth. While there isn’t much we can do to alleviate the challenges of being on the road for extended periods of time, there is one way to make the job of a truck driver a little easier: file Form 2290 and pay the Heavy Vehicle Use Tax (HVUT) with i2290.
All you have to do is create an account with us, answer a few questions about your business, and you’ll receive an IRS-stamped Schedule 1 in a matter of minutes. All of your tax documents will be stored online, available for you to access whenever you need them, and if you run into trouble at any point in the process, our dedicated support team will gladly be of assistance. So, are you ready for an easier, faster way to file and pay your taxes? Create an account with i2290 today!