"It doesn't matter what any trucking company says or what they pay. The truth is, they're all going to be within $3,000 to $4,000 of each other throughout the course of the year," says Ronny Betz, vp-driver recruiting at Celadon Trucking Services, Indianapolis.

It's hard to predict whether pay will go up, down – or stay the same

"With the way freight rates are nobody can afford to go out and throw a ton more dollars at driver pay. Some do, but they are running [fewer miles]. In the end, a guy making 39 cents a mile isn't taking home much more than the guy making 32 cents a mile. If they were both running 3,000 miles a week, there'd be a greater difference. But that's not what happens," says Betz.

Celadon increased its driver pay about four years ago but there are no plans to bump up pay rates in the near future.

Many carriers have decreased starting pay in the last year or so, primarily because a softening economy has eased the driver shortage somewhat. Others have cut back or eliminated sign-on bonuses for new hires.

Other recruiters agree that driver pay rates will probably not increase significantly in the near term. "I've seen a lot of companies, truckload carriers, up in the high 30s or low 40s for company drivers," says Bud Pierce at C.R. England in Salt Lake City.. "Several of them are now making reductions because they're just not profitable."

After rising significantly in previous years, driver pay remained relatively flat last year, according to the National Survey of Driver Wages. And since the economic outlook is unclear, it's hard to know how the supply of drivers and number of slots available will balance out. That's means it's hard to predict whether pay will go up, down or stay the same.

In addition to similar pay, most longhaul carriers also offer comparable benefits to company drivers, including health insurance, paid vacation time and retirement plans. If you're a leased owner-operator, though, the benefits package probably isn't quite as important. "Owner-operators tend not to be quite as interested in the benefits as the company guy," says Don Lacy, director of safety and recruiting at Prime Inc., Springfield, MO.

FRINGE BENEFITS
"Vacation is very important to the company drivers, and people with families are very interested in health insurance."

Prime offers its leased operators the opportunity to buy health insurance through its group pool.

Rather than focusing only on pay per mile, a driver should consider a number of other factors before jumping to another carrier. Primarily, make sure the carrier being considered is a good fit in terms of the kinds of freight it hauls, where that freight is hauled, the type of equipment the company runs and other programs the carrier may offer.

"There are always other factors to consider in addition to pay," says Betz. "Freight lanes are probably the biggest thing. If you live in Oregon, for instance, and go to work for a company that doesn't run to Oregon, you'll never get home."

"In the end, it's all about what suits you. If you love the East Coast, you need to be with a carrier that's going to bounce you off the East Coast. If you love the West Coast, you need to be with a carrier that's going to bounce you off the West Coast. If you love to haul food, you need to be with somebody that's going to haul a lot of food."

"We point to our great freight network" when talking to prospective drivers and leased operators says Lacy. "We're the largest refrigerated carrier in the country and our freight is not cyclical because we're in the food business."

At C.R. England, Pierce points to the equipment they run as an added benefit. "One of the strongest things we have to attract drivers is that we spec owner-operator equipment. It's one of those things that maybe a new driver can't appreciate until he's been out on the road in another truck, but we feel our equipment makes our drivers happier.

Other factors worth considering include routes and equipment

"For our owner-operators, we believe the strongest thing is our length of haul,” Pierce continues. “Our typical length of haul is 1,500 miles. People stay with us for that reason."

Carriers are also giving drivers more choice in the types of hauls they run. Many truckload fleets are doing more regional hauling.

At Prime, for instance, drivers can opt to run short- or long-haul. "Our length of haul has been about 1,400 miles—we've never considered ourselves a short-haul carrier," says Lacy. "But we've found there are a lot of guys who really like shorter hauls because they're home more often and they're running in the same geographical area.

"Plus, you can make money on that freight," Lacy adds. "Some drivers actually do a greater weekly revenue than if they were running long-haul. We continue to look for that kind of business so we can move our people into it if that's what they want."

C.R. England also offers drivers an opportunity to run dedicated and shorter haul routes. "We just took over a small company in Texas," says Pierce. "The drivers are guaranteed $720 a week and they're home two days a week. That's not bad pay."

Leased owner-operators, on the other hand, want more miles. "A company driver typically looks for low risk and the most money possible," Pierce says. "On the leased owner-operator side, they want the potential to make much more money, and we have the platform for them to do that. We have a lot of short haul, dedicated freight that's good for company drivers, and we have the long hauls that are good for the owner-operators."

LEARN NEW SKILLS
Leased owner-operators should explore other programs offered by the carrier, especially those designed to improve their business skills. A number of carriers offer such programs.

Prime, for example, offers a two-day business skills course. "We have put more than 4,000 people through that," says Lacy. "You may be the greatest driver in the world, but you might not be the best business person. Our results are much better when people understand what makes money for them: how to increase production legally, and how to lower operating costs."

Leased owner-operators should also evaluate how carriers handle things like fuel surcharges and detention. "I think one way our pay packages have changed over the last few years is the fuel surcharge and how that's handled," says Lacy.

Leased owner-operators are after more miles for the most money

"In Prime's case, we've had a fuel surcharge program for a number of years. I think a number of carriers ignored that and when fuel prices continued to escalate, they were caught behind the power curve.

"Another thing we do to protect our independent contractors is being very aggressive in the collection of detention and downtime and delay caused by shippers. We don't always collect it, but we've been very aggressive in measuring it and billing for it.

"If we do collect it, the money goes straight to the contractor who's incurred the time loss. I think it's absolutely imperative, particularly with owner-operators, that you have those two things in place."

Todd Spencer, executive vice president of the Owner Operator Independent Drivers Ass n. (OOIDA), says owner-operators should be "absolutely sure" their contracts call for fuel surcharges and that all of such monies collected go to them.

"If a carrier doesn't have fuel surcharge provisions, it's not concerned with your financial survival,” Spencer says. “If the lease doesn't clearly say that 100% of the revenues derived from these surcharges go to you, then the carrier really doesn't have your best interests in mind."

In addition to base pay, many carriers also offer performance-based bonuses, or pay incentives. Some of these are based on miles run per week over a baseline, while others are based on on-time delivery rates or safety performance.

"We try to structure our pay packages so they are tied to performance," Prime's Lacy says. "In other words, they tend to fund themselves. It's not uncommon for a driver or owner-operator to have a bonus for on-time delivery and one for no preventable accidents. They get both the safety and service bonus."

Betz says Celadon also pays drivers a safety bonus. "It's based on a couple of different things," he says. "They have to have no preventable accidents and turn in a good clean log."

OOIDA's Spencer says drivers and owner-operators should make sure they understand how bonuses work, especially those based on mileage. "I'm not certain those kinds of incentives actually are going to work in the legitimate interest of the trucker. If someone's going to pay you a bonus to run 12,000 or 14,000 miles in a month, it seems amazing how hard you'd have to run to actually do that."

Spencer cautions owner-operators to make sure they know what their lease says before signing up with any carrier. "Forget what anybody is telling you, it's what's in writing that you're going to have to live with."

With regard to leasing contracts, Spencer advises people not to be afraid to negotiate. "There are things you can negotiate – and should negotiate. Leases can be modified. In theory, a contract is a mutual agreement between parties; it's not a take-it-or-leave-it thing."

While the majority of leased owner-operators are paid a percentage of the load, some still run on a per-mile basis. For those that do, Spencer says to make sure it's clear what mileage formula is being used.

"If it doesn't say practical miles, insist that it does," Spencer advises. "You're not being hard-headed if you question the lease — you're being sure you eliminate problems that might crop up down the road."

Pay rates and freight rates will always be linked. And in a soft economy like the one we’re enduring now, both have been flat.

Some within the industry see a turn-around ahead that could lead to higher rates and higher driver pay. Others are less optimistic.

Make sure you know how bonuses work

"I don't think rates will be going up anytime soon," says Celadon's Betz. "Things seem to be somewhat on the decline outside our industry, which could be an indicator of what trucking will be like next year. I think there'll be more folks available, which could drive pay rates down," he says. "We've already seen some of the major carriers drop their pay rates."

Lacy is not as pessimistic. "Actually, I think the driver shortage has kind of come back," he says. What makes him think this? He points out that carriers have been tightening their hiring standards in the last year or so. "I think everyone has become more picky about who they'll take. There's still a great need for drivers, particularly good ones."

This shortage could increase if business picks up, something Lacy thinks will happen sooner rather than later. "I think business will pick up. We think it's going to turn pretty rapidly when it turns." When and if that happens, driver pay may start to climb up again.

If you're considering changing carriers because the new guy pays a few more cents per mile, be aware that your paycheck depends on other factors as well.

These include length of haul, type of haul, freight lanes, benefits and performance bonuses. You could get 41¢/mi. and make less than someone driving for 35¢/mi. So do your homework—and look beyond the base pay.