Only 22% of transportation companies plan to increase hiring in the six months to April 2010 says a study by Grant Thornton LLP. More than half (59%) will reduce bonuses. At Dupré Logistics drivers will be paid hourly instead of by the mile.
For its 700-plus drivers, Dupré Logistics has initiated a pay strategy shared by few companies in this economic climate—paying its drivers by the hour. It’s an initiative the company says was implemented to produce better schedules, more quality team members and safer drivers. Dupré Logistics has stressed the new pay structure does not function as a cost-cutting measure, but rather a quality control initiative.
“At Dupré Logistics, we strive to recruit and retain the best team in the industry,” said Tom Voelkel, president. “The hourly compensation structure has proven beneficial in terms of safety, human resources and retention of our drivers. It’s an initiative with benefits that far outweigh the cost to our bottom line.”
The Dupré move contrasts with the results of a survey of transportation financial officers conducted by Grand Thornton LLP. Of the CFOs surveyed, 38% believe the US economy will improve during the period, making transportation more pessimistic than other industries (national average was 49% expecting an improved economy). Among the steps companies are taking, nearly one third (32%) said they expected to reduce health care benefits and 21% were reduing 401(k) matches.
Transportation CFOs did have a more optimistic view of their companies' financial prospects. Half said they expected improvement over the coming six months vs. a national average of 45%.
Most transportation companies expect to keep headcount steady (63%) with only 16% expecting further reductions.
According to the survey, only 13% of transportation CFOs expected the US economy would come out of the recession by the end of 2009. One third (34%) said the US would emerge from the recession in the first half of 2010, and 41% said the second half of 2010.