It is not a matter of paying "more" but changing how they pay
Most Truckers are paid by the mile... So if your sitting in traffic no pay (next time your stopped in traffic look around, how many semi's are sitting with you, most of those drivers are doing it for free)
Then there is load and unload time, which for some companies is non-paid, other is a nominal flat rate of like $35 that could take up hours of your day.
Then there is the "hours of service" which many companies require their drivers go "off duty" when they arrive at warehouse, but the warehouse required them to monitor the CB Radio to be called to pull into a dock, so their "sleep" time is taken up waiting to be unloaded, and they do this waiting for free.
Trucking companies need to end the practice of per mile pay, and start paying drivers Per Hour or a Salary (non-exempt) like every other company.
You started down the right road. Much of their pay has to do with how they are paid. There are trucking companies that don't pay drivers to fuel the truck. Do you know how long that takes? It isn't like it is an optional task - that truck won't move without fuel.
I know a driver who spends 2-6 hours waiting to be unloaded. He doesn't get paid for that time but isn't free to leave the truck because when the loading dock is ready for him he needs to be there to move the truck. How is that not being "on call"? If he wasn't working he could go catch a movie or dinner, sleep or whatever, but for some reason the law says it is OK to make him sit without pay to do his job.
The issue is that most drivers incorrectly assume they are in the weakest position for any given scenario. They absorb delays as if it were their own fault and falsify logs to compensate. Many drivers even absorbed the reimbursable toll costs on a route because they couldn't match the ticket times to their falsified logs.
They are afraid to log as 'on duty not driving', which is how they legally should be doing it. Sure, they make less that one day but the sheer number of hours wasted at the shipper or consignee will have a knock-on effect which will make on-time delivery less likely. I drove tractor-trailers in the US for eight years and I would tell other drivers 'this system is broken, allow it to fail and cover your ass by documenting everything'.
I refused to falsify my logs and would rigidly log everything 100% accurately, even logging Hours of Service violations (e.g. difficulty finding parking & going 30-45 min over on drive time) which could have cost me a ticket. Once in a while I'd get hauled into a weigh station for an inspection and they'd notice the hours violation. I explained about refusing to falsify and they'd see this was true. I'd get a funny look but never a ticket.
The outcome here was that I was very predictable to the 'trip planners', who were one grade above the lowly dispatchers. The trip planners always knew exactly where I stood from the truck's telemetry data, plus I would always communicate delays. They were better able to predict how to use my time and their company truck. I was never out of pocket for reimbursable expenses because time/date stamps on receipts always matched. I was making more than most of our company-employed drivers and even some of the owner-operators who struggled with fuel costs, etc.
The dispatchers hated me because they constantly had to explain to management why my loads were late and how I could not be blamed for the delays as I had documented everything and communicated the delays well in advance. Every other driver would have gone over their hours illegally to compensate, but I always stopped when I ran out of driving hours and therefore missed appointments.
They all caught on after a while and learned to use my time more wisely. I reliably made $50-55K/year which was exceptional for trucking and enjoyed the very low tax rate Hours of Service workers get (9%, taking the standard deduction x days worked, typically). It was an interesting job overall because of all the sights you see, but I can't recommend it to anyone looking for a career change. Stick with the tech sector as it is much safer and you can go home every night.
thanks for sharing your experience, it sounds like a tough job just to do the job right. do you think the system will get un-broken before we start seeing things like automated trucks?
There is a lot to automate, for example shifting the trailer tandem axles or the 'fifth wheel' to more evenly distribute the weight per axle. I don't know how an automated truck would handle driving across Wyoming with tens of thousands of big tumbleweeds blowing across the road, would the collision-avoidance system be triggered? A human knows what they are and that you just keep going full-speed.
Snow is another issue. Sometimes you can safely drive through snowdrifts at speed and keep going. Sometimes it isn't a snowdrift at all, but a car covered in snow and abandoned on the highway, and the only way to tell is to approach slowly and look for an antenna sticking up or something like that. Not an everyday occurrence but it illustrates a scenario where human intelligence keeps you moving ahead when an automated system would probably need to stop and wait for human intervention.
Trucking is a huge industry with well over 100% annual turnover, and many individual drivers taking liability for accidents that were preventable. With automated trucks, that liability burden may shift back to the companies who would no longer be able to plead ignorance. It's one more issue to deal with in addition to getting the technology right.
In the snow example in particular, a properly-equipped autotruck could scan it with short-wave radar, which would go right through snow but bounce off metal. But that's a nitpick; there's lots of things that an experienced driver can handle easily but a robodriver would have trouble with.
You could certainly keep "control centers" with a few of those experienced drivers in them, where decisions for what the automated vehicle is to do in low-confidence situations get "escalated" to a human, along with the relevant sense data.
An hourly wage is a very special payment system which requires some kind of foreman to be sustainable. Otherwise, the labour industry tends to drift towards inefficiencies that allow them to claim money for less work. This is classic agency risk, where the incentives are not aligned, and heading down this path often entails major bureaucracies to try and keep everyone honest (like time clocks and punch cards, a "boss" looking over you, etc).
Simply paying more within the existing structure makes perfect sense. It will actually have a disproportionate effect on recruitment when some of the most efficient drivers start bragging about making $160,000 a year driving trucks (this is one of the big drivers of immigration by the way. Compared to poorer nations, the streets are paved in gold in the USA, and some lucky immigrants find shovels to dig it up. Unfortunately, most people who come never get a shovel so it remains but a dream...).
Paying more by the mile absorbs the costs of refuelling and traffic, without giving any driver an incentive to waste time when, for example refuelling the truck. So rational truckers will go to gas stations that are more efficient and will get out of there as soon as they can.
Where the trucker has no agency, however, it could make sense to pay by the hour. For example, since loading is in the hands of another group as soon as the truck docks in, and since it can vary quite a bit based on warehouse, better that the driver is paid for time sitting around. You could argue that the driver's incentive is to rush the loaders, but I doubt they have any coercion in that process. So better that the shipping company have an incentive to make loadings as fast possible through influence over choice of warehouse, penalties to warehouses for slow loadings, etc.
I've never really thought about this industry before, but thinking about it now makes it sound very interesting!
What seems more likely, actually, is that you will get Akerlof's classic lemon market - due to the information asymmetry of paying by the mile.
The employer knows how much value the driver's gonna contribute for the money they pay, but the potential drivers aren't at all sure how much income they'll get paid for their time/effort. They basically only have hearsay from other drivers/ex-drivers to go on. Furthermore, some are getting burned and leaving the industry (I know personally of one; and there's another in this very thread), and telling others about their experiences.
The number of confounding variables and risks (including but not limited to loading/unloading) are simply too high for them to be able to make an accurate judgment about their potential income.
The natural effect of a lemon market is that the market dries up because the buyers/sellers simply stop transacting when the problems caused by the information asymmetry are too much.
That actually seems to be exactly the situation we're getting here. The wages don't seem to be that bad actually, but the risk is all piled on to the driver, so new recruits are very reluctant to enter the industry after hearing a few horror stories.
Lots of startups have gone down for similar reasons - pricing that is too complex makes potential customers go 'fuck it' and go with the devil they know.
The market for lemons doesn't really apply here, because a lemon market requires a supply that is heavily weighted toward worthless goods, to drag the average down to 0 as the "best" opportunities are withdrawn from market.
Assume labor is the currency and the good is cash. If a majority of trucking employers give employees a mediocre or poor deal, then the supply of trucking jobs in the aggregate delivers poor value for the required labor input, in comparison to other lines of employment. Good firms either go out of business (due to being undercut) or retain their drivers, such that there are few openings at good firms.
In an ideal world good firms would increase their market share, but doing that requires satisfying trucking consumers and they want their goods shipped as cheaply and quickly as possible. So the interests of consumers and suppliers (of trucking services, ie drivers) are not very well aligned. I don't know what can be done about this; as a consumer I have absolutely no clue which hauling companies handle the goods I purchase, nor do I have any clue how much of a good's price consists of shipping costs. So I can't really vote with my dollars to let store owners know that I'm willing to pay a little more to support trucking companies that treat their employees well.
Nope. It just requires information asymmetry, which IS the case here. Trucking companies know more about what income their potential workers will make than the potential workers will themselves.
Experienced truckers will have less information asymmetry, but experienced truckers need to be replenished as they retire. Apparently that's not happening.
In the perfect world of the auto-correcting market.
In real life, in the case of coal miners and their "dead work" (necessary work that wasn't getting paid), it took bloody strikes and fights to get those rises, the amounts paid weren't automatically upgraded.
The "money required to attract X workers" only plays a role when those X workers are not destitute and starving to begin with. If they are, and the company can pay them less and still have a huge profit from their work, it'll do that.
> If drivers spend much time loading and unloading, and not getting paid, the amount paid per mile required to attract drivers will rise.
Actually, logic would indicate that it has already happened. Every industry pays people the least amount that it can reliably obtain labor and/or reliably profit from their employment. Trucking is no different.
That has not been the case, historically. Time spent "on duty, not driving" has been a major complaint for decades and is one of the reasons duty schedules are ridiculous.
1. Most companies use what is called "Book Miles" for payment and these books I believe were published in the 1940's or something, because most companies "Book Miles" are vastly different than the actual miles driven
2. "Foreman" problem can be solved with Technology, the DOT is planning on requiring all electronic logs in the near future, like 2015 I believe, most trucking outfits already have realtime GPS monitoring of their trucks, you can monitor these employees in a far more accurate manner than one can monitor factory workers.
3. Most company truckers do not have a choice of where they fuel, this is planned as part of the trip, and they are provided a fleet card that is only accepted at a chain the company has a contract with.
this is just a start but I think you believe truckers have more freedom then they do in reality. The technology and logistics that goes in to trucking does not allow for any independent thought, they are given a route, with preplanned fuel and rest stops, if they deviate from this route they must explain why (i.e mechanical failure, stopped by police, etc)
While they may not have a human foreman monitoring their time clock, they have electronic foreman's and government regulators acting as foreman's
"Paying more by the mile absorbs the costs of refuelling and traffic, without giving any driver an incentive to waste time..."
It also gives the driver incentives to drive too long, too fast, to reduce maintenance, and to take other shortcuts that cause longer-term and safety problems. (Fortunately, the industry has done pretty well at pushing liability onto the drivers.)
If I take a contract job which pays $X / deliverable then I may end up doing some "free" work as well if something comes up that I hadn't accounted for. Same goes for my day job when I work past 6 (exempt, of course).
Not all jobs are hourly. Why should this change for truckers and no one else? Are you proposing that all jobs should pay for every minute of work? I'm not saying you're wrong necessarily, but I'm interested in your reasoning.
In contracting the company or person hiring you generally knows very little about programming and even less about yourself. You have the information advantage, you usually price the job, and you know how hard you're going to work and how long these sorts of jobs usually take you. It makes sense in that context for you to carry the risk if you choose to be paid by deliverable.
Whereas, if you're a trucker, you don't know any more than the company does about whether the gods of traffic are going to take a dump on you that day - and there's not a whole bunch you can do about it. In that context it doesn't seem to me to make much sense to pay on that sort of basis.
The point of paying with a target is - at least when you're not trying to screw people out of money - to tie reward to the risks that they can control. If they can't control the risk, it becomes little more than a way of concealing from people what the take-home is going to be.
First and fore most I am not talking about "contract jobs" these are not 1099 contractors, these are W2 employees, and they should not be classified as exempt for over time, or be allowed to paid per mile IMO. These are Blue Collar jobs and should be treated like a Fork Truck Driver, or a Factory worker, not as a Laywer or even in SysAdmin or Developer.
True Contract Jobs, i.e owner operators, should be paid based on however they draw up their contracts, that is one business employing another business and it outside the conversation of employment law
How you pay for work performed is a complex matter. It's one that Adam Smith covers (as he does most topics) at length in Wealth of Nations. In particular he warns of the tendency to pitch compensation terms such that workers are overincentivized to work, reducing their overall productivity and burning out faster.
(I'm adding some paragraph breaks to Smith's text, this is a single paragraph in the original. Emphasis added as well.)
"The liberal reward of labour, as it encourages the propagation, so it increases the industry of the common people. The wages of labour are the encouragement of industry, which, like every other human quality, improves in proportion to the encouragement it receives. A plentiful subsistence increases the bodily strength of the labourer, and the comfortable hope of bettering his condition, and of ending his days, perhaps, in ease and plenty, animates him to exert that strength to the utmost. Where wages are high, accordingly, we shall always find the workmen more active, diligent, and expeditious, than where they are low; in England, for example, than in Scotland; in the neighbourhood of great towns, than in remote country places.
"Some workmen, indeed, when they can earn in four days what will maintain them through the week, will be idle the other three. This, however, is by no means the case with the greater part. Workmen, on the contrary, when they are liberally paid by the piece, are very apt to overwork themselves, and to ruin their health and constitution in a few years. A carpenter in London, and in some other places, is not supposed to last in his utmost vigour above eight years. Something of the same kind happens in many other trades, in which the workmen are paid by the piece; as they generally are in manufactures, and even in country labour, wherever wages are higher than ordinary. Almost every class of artificers is subject to some peculiar infirmity occasioned by excessive application to their peculiar species of work. Ramuzzini, an eminent Italian physician, has written a particular book concerning such diseases.
"We do not reckon our soldiers the most industrious set of people among us; yet when soldiers have been employed in some particular sorts of work, and liberally paid by the piece, their officers have frequently been obliged to stipulate with the undertaker, that they should not be allowed to earn above a certain sum every day, according to the rate at which they were paid. Till this stipulation was made, mutual emulation, and the desire of greater gain, frequently prompted them to overwork themselves, and to hurt their health by excessive labour.
"Excessive application, during four days of the week, is frequently the real cause of the idleness of the other three, so much and so loudly complained of. Great labour, either of mind or body, continued for several days together is, in most men, naturally followed by a great desire of relaxation, which, if not restrained by force, or by some strong necessity, is almost irresistible. It is the call of nature, which requires to be relieved by some indulgence, sometimes of ease only, but sometimes too of dissipation and diversion. If it is not complied with, the consequences are often dangerous and sometimes fatal, and such as almost always, sooner or later, bring on the peculiar infirmity of the trade.
"If masters would always listen to the dictates of reason and humanity, they have frequently occasion rather to moderate, than to animate the application of many of their workmen. It will be found, I believe, in every sort of trade, that the man who works so moderately, as to be able to work constantly, not only preserves his health the longest, but, in the course of the year, executes the greatest quantity of work."
Most Truckers are paid by the mile... So if your sitting in traffic no pay (next time your stopped in traffic look around, how many semi's are sitting with you, most of those drivers are doing it for free)
Then there is load and unload time, which for some companies is non-paid, other is a nominal flat rate of like $35 that could take up hours of your day.
Then there is the "hours of service" which many companies require their drivers go "off duty" when they arrive at warehouse, but the warehouse required them to monitor the CB Radio to be called to pull into a dock, so their "sleep" time is taken up waiting to be unloaded, and they do this waiting for free.
Trucking companies need to end the practice of per mile pay, and start paying drivers Per Hour or a Salary (non-exempt) like every other company.