Driver Recruitment & Retention: Let the numbers talk!

The shortage of truck drivers in the global supply chain industry has become a noticeable issue, and it isn’t likely to be resolved anytime soon. If recruiting great drivers is tough, then in present times, retaining them is even harder. To keep the goods moving across the nation, fleet managers and trucking company owners must identify the reasons for a high driver turnover rate, and find solutions to mitigate the risks that tag along. Putting the spotlight on this, Logistics Insider has put together this feature, where we not only highlight the numbers pertaining to driver turnover, but also look into its reasons and possible solutions, for small as well as large organizations.

As road freight travel continues to grow, the number of trucks plying on Indian roads and highways is expected to more than quadruple, from 4 million in 2022 to roughly 17 million trucks by 2050. But as the industry grows, the man steering the wheels on the truck does not. Trucking, which is the part of an essential industry, has always been a tough job. It is a career that takes an exceptional amount of patience, perseverance, and hard work.

Opting for it as a profession in India – where the trucking sector is highly unorganized – comes with almost negligent work-life balance, low and irregular income, the risk of betting on one’s dignity and societal status, and facing harassment by those in authority.

All of the aforesaid has made it difficult to employ new drivers and retain the old ones, despite a considerable growth in demand. Moreover, the market conditions of the past year – a sluggish economy, supply chain shortages, high fuel costs and low spot market prices – are making it tougher by the day.

Commenting on the same, Jatin Bhat, Chief Executive Officer, SendEx Couriers and Cargo said, “Before COVID-19 happened, the trucking industry already had a saturated and coherent framework, allowing them to have periodic contracts that were already in place, which helped them in foresee the engagement for at least 2 years to the company they were associated with.  After COVID-19 the whole paradigm of industry changed and a lot of new people started getting their hands on the movement of supply chain which resulted in more inward flux of vehicles, and the industry has seen a competitive approach in providing services for lesser rates which made a major impact in the distribution of goods. Since the same has been beneficial for the owners who are in use of services but a sense of reliability is now becoming a major issue for the industry.”

As estimated by the American Trucking Associations (ATA), the trucking industry is currently facing a chronic trucking labour shortage even with over 80,000 drivers. On the domestic front, “There is a shortage of drivers across the nation,” says Mahendra Arya, President, All India Truckers Welfare
Association (AITWA).

While the issue of driver retention and recruitment is present among small and large fleet owners alike, it is the small fleet owners (over 90% of all the nation’s trucking companies) who suffer more.

“The smaller fleet owners are facing the heat more as compared to the mid-size or large trucking companies, as they are unable to provide the truckers with basic facilities, Whereas, the large fleet owners are doing comparatively better, with government policies like Gati Shakti and NLP turning out to be in their favour. Also, the driver feels secure in his profession when working with larger organizations considering the basic and added facilities provided to them by the organization,” Mr Arya said.

Venu Kondur, CEO & Co-Founder, Lobb said, “Shortage of drivers results in poor utilization of existing assets. This results in a reduction in supply.” He adds, “As the gap between demand & supply increases sourcing cost also increases, which affects price rise for all consumers. This also negatively affects the profitability of fleet owners, hence, paying capacity for the drivers, which again has a catastrophic effect on all stakeholders i.e transporters, manufacturers & consumers.”

As per a recent survey by SmartHop, though truckers of small fleets aren’t quitting en masse, they have seen a substantial percentage of truckers quitting over the past year. Citing the percentage of drivers that have quit in the past year, the survey says that 11% of fleet owners say that none have left the organization, 33% say that fewer than 10% of staff have quit, 25% say about one quarter, while 14% say about one third have left. About 9% of the small fleet owners participating in the survey claim that about half of the drivers have left, 5% say two-thirds, 2% say three-quarters and only 1% say that almost all the drivers have left. The survey claims that small fleet owners are confident that older employees are more willing to stick with the profession, while the younger ones have them worried.

When it comes to turnover, it’s the younger drivers – specifically those 26-45 years old – that give small fleet owners the most concern. While drivers in the age group 25-35 have the owners the most worried (40%), it is followed by age group 36-45 (33%), 46-55 (12%), 18-25 (9%) and the age group which is giving the least worry is 56+ (4%).

This is an abridged version of the original story published in the December 2022 issue of Logistics Insider magazine. Click here to read the complete story.

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