Every trucking company has to recruit truck drivers. Considering that the driver shortage is not going away any time soon you are going to need to keep recruiting drivers. So what is the average cost to recruit truck drivers and how do your recruitment costs compare?
Industry Average to Recruit Drivers
There has only been one study published that calculated the industry’s average cost to recruit truck drivers, and it was published in 2001. The study conducted by Upper Great Plains Transportation Institute found that carriers spend on average $8,234 to hire a driver.
In today’s money that is $12,084. On average, trucking companies are spending over ten thousand dollars for every truck driver that they hire.
However, that industry average more than likely is not going to be reflective of your cost to recruit drivers. That is because the spread from the study ranged from $2,243 to $20,729.
Instead of worrying about the average across the industry, you should focus on calculating your specific costs.
Calculating YOUR Hiring Costs
The industry average is a great measuring stick for your company. You need to calculate your company’s hiring costs and then compare it to the industry average. Ask yourself, why is it that your costs are either higher or lower than the average.
The metrics that should be used to calculate your costs are:
- Entry and exit administration
- Fixed asset costs due to idle equipment
- Profit lost due to idle equipment
- Other costs including safety/insurance/legal, maintenance, and productivity loss.
Inorder to calculate your cost per hire you need to determine a time period (this can be one month, one quarter, six months, or a year), calculate the costs for the metrics mentioned above, and divide those costs by the number of hires you made in that time period.
How to Improve Your Driver Retention
No matter how much your company is spending on hiring costs, it should be clear that the most effective way to reduce those costs is to improve your retention rate. If drivers are not leaving your company then you will not need to hire new drivers to replace them.
There are three pillars to truck driver retention: pay, respect, and management. Your company needs to offer competitive pay to your drivers (no low-balling them), treat drivers with the utmost respect, and employ fleet managers that know what they are doing.
By improving your driver retention, you will be able to keep your drivers on staff and not need to worry as much about your driver turnover costs.
How to Reduce Your Hiring Costs
The lion’s share of costs associated with driver turnover have to do with idle trucks. This means that if you are able to reduce the amount of time it takes to hire a driver then your hiring costs will also be reduced. Reduced hiring time means reduced time with idle trucks.
The best way to have a faster hiring time is to employ a truck company advertising agency that places your job ads at the best places to recruit drivers. Doing this will fill your ATS with branded (aka direct) leads.
Branded leads are truck drivers who apply to work specifically for your company because of your brand. These leads are anticipating a call from your recruiters or will even reach out to your company themselves.
Your recruiters will be able to hire drivers much faster when they are calling drivers that want to work for you. Branded leads will lower the amount of time your company has to deal with idle trucks, the biggest cost of driver turnover.
The average cost to recruit truck drivers is $12,084 across the industry. This average is a great measuring stick for your company to see how you stack up in the industry once you have calculated your hiring costs. Even if your company is below the average, it is wise to improve your retention rate and hiring costs.