Why do companies hire new drivers?

A new driver has no DAC history. The idea that they work cheaper is one that doesn't work out on paper either. Most trainers get paid for every mile the truck runs as a team operation plus the trainee gets paid a flat rate while training. Insurance costs more for newbies but that is another tax deduction available for corporations.

But the dirty little secret is that the company gets a tax break for hiring them. And the only way I know that is because a recruiter let me in on it back when his company was seriously considering starting a school of their own.

This is one of those "Now that you know, how do you feel?" moments.

 

Yet just another example of how it comes down to MONEY!

 

We have a winner. It comes down to money and his points are the ones I was gonna make. Many companies will have you on the hook for that training contract you signed worth $6,000. This is the main reason we tell all of the newbies to pay for it separate of a company.

The main point I was gonna make though is the team miles. Con-way Freight requires many of its sub-service lanes to be run with teams to make the tight deadlines - those lanes still pay well to the companies we sub contract. CRST almost always comes in here with two students running as a team - Werner comes in with a "trainer" and a student. Both of these options are much cheaper for those companies than having experienced teams run the freight - or a Con-way Freight driver making mid .50's per mile.

For service reasons, we still use Con-way Truckload for the coast to coast stuff even though it costs more - plain and simple they have experienced teams and provide much better service.

Money money money. Think about this.. Con-way owns a freight company and a truckload company yet it's still cheaper to use the mega carriers that hire students to move our freight. Con-way Freight pays substantially better than most driving jobs, and Truckload seems pretty good for an OTR job - it's all about cheap labor.

 

Well.... I've done a little research and finding any information is really convoluted. Typical of the government.

I think that the reason you don't often hear the same incentive figure quoted over and over is that there isn't one. It's basically a grant system. Which would mean that the amount awarded to each company will vary based on several criteria and the ability of the grant writer.

From the FMCSA site;

Followed by;

Not comprehensive but a good place to start researching if you want to go blind reading governemnt websites. Because it is the FMCSA alot of it has to do with "safety concerns" as related to training.

...................... Jim

 

One more thought.

When something is being done that really doesn't make sense, like companies hiring trainees in a tough economy, follow the money.

Ya' want a realy fun one? How about L/O programs?

The carrier buys a tractor for around $85K. Charges the lease op $500.00 per week on a three year lease or $26K per year times three years = $78K with an average $30K buyout at the end of the lease for a total of $108K or $23K profit per unit to the company.

If they can lease 1000 tractors that's 23 million in gross profit. Plus we know that they can lease the same unit overt and over. All while defering the operating costs to the L/O.

So let's look at a newbie who goes to work for a mega-carrier. He signs up for $3k in training, the company gets a $6k incentive, he becomes a lease op. and they make $20k on the lease. That's $29k per "victim".

Do the math - With those figures it only takes about 35 "victims" for the carrier to gross one million dollars.

again this is only MHFO worth exactly what you paid for it.

................ Jim

ETA: Ya I've seen that one. I think also if you really want to dive into it there's some Department of Labor stuff too.

Yes the deadline to apply for this one has passed but, if an application was made within the dealine, the funds have not yet been disburssed.