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Developing the profiles of truck drivers for their successful recruitment and retention:
A data mining approach
Hokey Min Ahmed Emam
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To cite this document:
Hokey Min Ahmed Emam, (2003),"Developing the profiles of truck drivers for their successful recruitment
and retention", International Journal of Physical Distribution & Logistics Management, Vol. 33 Iss 2 pp. 149
- 162
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Recruitment and
Developing the profiles of retention
truck drivers for their
successful recruitment and 149
retention Received March 2002
A data mining approach Revised October 2002
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Hokey Min
UPS Center for Worldwide Supply Chain Management, University of
Louisville, Louisville, Kentucky, USA, and
Ahmed Emam
Department of Computer Science and Engineering, Western Kentucky
University, Bowling Green, Kentucky, USA
Introduction
Despite the recent slowdown of the US economy many trucking firms are still
experiencing a difficulty in finding and retaining qualified labor. For the last
two decades, the trucking industry has been hit hard by a shortage of truck
drivers. For instance, between 1992 and 1999, employment within the trucking
industry grew much faster (31.10 percent) than the US total employment
growth of 18.75 percent (Bureau of Labor Statistics, 1999). Despite faster job
growth, the trucking industry has experienced unusually high turnover rates.
In 1992, for-hire truckload carriers often had 100 to 200 percent annual driver
turnover rates, whereas the median employee turnover in the USA was 8.4
The authors would like to express sincere gratitude to the UPS Foundation and the Kentucky
Motor Transport Association for their financial sponsorship of this research. The authors also International Journal of Physical
Distribution & Logistics Management
thank the motor carriers who kindly responded to the questionnaire and provided valuable data Vol. 33 No. 2, 2003
for this research. Last, but not least, the authors would like to thank Dr. David Page of the pp. 149-162
q MCB UP Limited
University of Wisconsin-Madison for giving us his insightful advice on the use of data mining 0960-0035
techniques. DOI 10.1108/09600030310469153
IJPDLM percent (Overdrive, 1997). Labor shortage has already undermined the
33,2 profitability of the trucking industry. Pressured with chronic labor shortages
and mounting fuel costs, some trucking firms such as J.B. Hunt Transport
Services, Schneider National, Yellow Freight Systems, Consolidated
Freightways, Roadway Express, and Swift Transportation have recently
planned to raise their freight rates by 5 to 10 percent (Machalaba, 1999). Indeed,
150 truck rates are rising as evidenced by the 10 percent rise in intercity trucking
costs and the 8 percent increase in local trucking costs (Minahan, 1998).
Despite continued efforts to control trucking costs, there is no sign of
improvement. The key to substantial productivity gains in trucking is stability
in truck drivers’ jobs. According to the Trucking Economic Review (Costello,
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1999), the truckload (TL) carriers reported an average driver turnover rate of
103 percent in late 1999, while smaller carriers reported an average driver
turnover rate of 92 percent. Some TL driver turnover rates have been reported
as high as 300 percent, compared to an industry average of 100 percent (Bearth,
1999). Thus, TL and less-than-truckload (LTL) have dramatically different
challenges with driver turnover, since TL segments are more affected by severe
driver turnover than LTL segments. Such a high turnover may be due to an
unprecedented demand for trucking services, slow growth in the qualified labor
force, tougher federal safety regulations, and poor human resource
management. Considering the significance of trucking to logistics
productivity, a high driver turnover and the resultant driver shortage may
have far-reaching effects on the competitiveness of the logistics industry. In
1998, trucking accounted for 86 percent of the total freight bill in the USA and
the trucking industry grew by more than $24 billion (Schulz, 1999). As of 1999,
the trucking industry employed more than 3.1 million truck drivers, resulting
approximately in a 66 percent increase from the 1980 driver employment figure
(Wilson, 2001). By 2006, the trucking industry is projected to generate $446.2
billion of revenues (ATA Logistics Council, 1998). Therefore, there is a growing
need to formulate viable driver recruitment and retention strategies which will
alleviate an on-going driver shortage problem.
Various attempts have been made to address driver shortage problems.
Many trucking firms such as J.B. Hunt, Boyd Brothers, Contract Freighters Inc.
(CFI), and O & S Trucking boosted driver pay to reduce driver turnovers.
Between 1997 and 1998, 80 percent of the top 100 carriers increased driver
wages by an average of 10 percent (Moore, 1999). On the other hand, Celadon
Trucking and Cargo Transporters began to reward drivers for their longevity.
U.S. Xpress Enterprises, Interstate Worldwide Relocation, and Consolidated
Freightways introduced bonus programs for drivers’ safe driving records.
Reflecting a driver’s desire for new and comfortable equipment, Boyd Brothers
reduced its equipment cycles to 36-40 months from a 42-48 month downturn
(Moore, 1997). C.R. England & Sons beefed up its driver training by investing
$6 million in a state-of-the-art driver training center (Kahaner, 1998). Other
driver recruitment and retention strategies include a sign-on bonus, profit Recruitment and
sharing, flexible driving schedules, driver recognition, career advancement retention
opportunities, and reduction in non-driving activities. Although all of these
have potential merits, the effectiveness of these strategies is not necessarily
verified by the existing literature. This paper goes beyond the existing
literature by identifying primary causes of driver turnover and developing the
most viable driver recruitment and retention strategies through driver 151
profiling. In general, driver profiling aims to target some of the “valued
drivers” for special attention, based on their anticipated loyalty to the trucking
firm. For example, Beilock and Capelle (1990) indicated that the older and the
less educated a driver is, the greater the chance he or she will stay with the firm
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Research methodology
Sample
To examine the causes of high driver turnover, a four-page questionnaire was
mailed in November of 1999 to approximately 3,000 randomly selected trucking
firms listed in the National Motor Carrier Directory (Transportation Technical
Services, 1999) and located in Midwestern (Ohio, Indiana, Illinois, Missouri) and
Southern States (Kentucky, Tennessee, Georgia). To increase variability in the
data and generality of the survey results, various sectors of the trucking
industry were represented in the sample. These industries include regional TL
carriers (33.5 percent of the responding firms), national TL carriers (21.8
IJPDLM percent), both national LTL and TL carriers (11.4 percent), both regional LTL
33,2 and TL carriers (8.7 percent), regional LTL carriers (6.1 percent), national LTL
carriers (1.9 percent), and others (16.5 percent).
Of the 3,000 questionnaires, 422 valid responses were received and 16 were
returned as undeliverable. These responses produced a total response rate of
14.14 percent. Although we had originally hoped for a higher response rate, a
152 response rate below 20 percent for a mail-survey is not uncommon in the
logistics literature (e.g. Mentzer et al., 1992; Murphy and Daley, 1994; Pedersen
and Gray, 1998; Sum et al., 2001). To avoid potential non-response errors, a
series of tests for non-response bias (difference between the answers of
respondents and non-respondents) was conducted by comparing early
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responses (364 responses that were received less than three weeks after
mailing) with late responses (58 responses that were received more than three
weeks after mailing) in terms of item response. Results of our comparison of
early and late responses indicated that there were no statistically significant
differences in group mean scores for the two waves of samples at a ¼ 0:05 on
any of the item responses related to the size and sales volume of the responding
firms, annual driver turnover rate, driver profiles, the relative importance of
driver incentives to driver recruitment and retention, and the potential causes
of driver shortages. Therefore, non-response bias did not appear to be a concern
under the assumption that the non-respondents are like the late respondents in
the second wave (Armstrong and Overton, 1977). For various methods of
measuring non-response bias in the mail surveys, interested readers should
refer to an excellent article written by Lambert and Harrington (1990).
Research instrument
Traditionally, data collected from the questionnaire was analyzed using
statistical techniques that aimed to verify certain premises through a series of
hypotheses testing. Examples of such traditional methods in investigating the
causes of driver turnover include: Beilock and Capelle (1990), LeMay et al.
(1993), Gooley (1997), and Keller and Ozment (1999). Though still useful for
certain situations, hypothesis testing can be inconsistent unless the level of
statistical significance is decreased as the sample size increases (Glamour et al.
(1996)). Hypothesis testing is also limited to either substantiating or disproving
a pre-conceived notion. In other words, although hypothesis testing may allow
us to validate some intuitive premises, inferential association made by
hypothesis testing may not be sufficient enough for us to accurately predict
behavioral patterns of drivers in different organizational settings. To overcome
such a potential shortcoming, we employed data mining techniques. In general,
data mining is a process of searching for previously unknown but meaningful
information, such as decision making patterns and trends, by sifting through
large data sets and utilizing a combination of pattern-recognition, model
building, and validation techniques. In particular, we chose decision trees from
the various data mining methods due to its visual appeal and simplicity in
setting up useful rules. Decision trees aim to classify data into a finite number Recruitment and
of classes by generating a hierarchy of “IF-THEN” statements (Menon and retention
Sharda, 1999). To construct decision trees, we followed three key steps as
shown in Figure 1 and described below:
(1) Data collection. As indicated earlier, the raw data was collected by
questionnaire for the survey. Since the input to the data mining model 153
affects the choice of a data mining algorithm and the resultant rules, we
attempted to remove polluted data such as incorrectly coded input (e.g.
typos) or inconsistent input (e.g. outliers) from the database by filtering
out the Excel file. This data cleaning process is followed by the data pre-
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Figure 1.
Data mining steps
IJPDLM (or benefit packages) and consequently help the trucking firm to
33,2 formulate a successful driver recruitment and retention strategy. Among
a variety of algorithms for building decision trees such as classification
and regression trees (CART), C5.0, and chi-squared automatic interaction
detection (CHAID), we selected C5.0 due to its speed, small memory
requirement, effective pruning capability and boosting and cross-
154 validation features which greatly improve predictive accuracy. By
running C5.0 under the Microsoft Windows 2000 operating system, we
developed decision rules recapitulated in Appendices 1 and 2. Some of
these rules are derived from so-called “market basket” analyses which
extract drivers’ behavioral patterns from coincidence. For example, the
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driver’s loyalty tends to be linked to both the driver’s longevity with the
trucking firm and size of the trucking firm with whom the driver has
been associated.
Figure 2.
A decision tree for truck
driver turnover
IJPDLM trucking firm for less than six years is likely to cause high driver turnover.
33,2 Likewise, we discovered that, by itself, the company’s offering of a high level
annual starting salary would be effective in recruiting drivers as shown in rules
8(a), 8(b), 13(a), 13(b), 13(c), 14(a), 14(b), 14(c), and 14(d) (see Appendix 2). When
a high monetary incentive, such as annual starting salary, was offered to
drivers of a certain profile (e.g. an age group of 46 years or older, drivers who
156 would be hired by relatively small trucking firms), we found a distinctive
pattern of a positive driver response to such an incentive. That is to say,
trucking firms should develop a stratified recruitment strategy that allows for
targeting certain driver profiles.
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Cosenza (1998) argued that one of the main causes for such a quick turnover
might be a mismatch between the driver’s personality and the culture of the
trucking firm. Therefore, realistic job previews (RJPs) during the recruitment
process are crucial for the prevention of quick driver turnover. RJPs will help to
reduce the gap between the driver’s expectation of a given job and “the actual
life on the road,” thereby leading to more accurate job information, greater role
clarity, and a better ability to handle job-related stress.
Third, we found a pattern indicating that unionized or full-time drivers are
less likely to cause turnover than non-unionized or part-time drivers. This
pattern makes sense in that union status or full-time appointment may increase
the driver’s sense of belonging to his/her organization and subsequently
enhance job satisfaction. Therefore, firms that have a relatively large number
of non-unionized and/or part-time drivers should pay more attention to
developing a positive work environment (e.g. better fringe benefits, career
advancement opportunity, flexible schedules, and job security) and nurturing a
strong bond between drivers and dispatchers.
Finally, drivers, who have limited driving experience (e.g. less than six
years), are likely to cause higher turnover rates than others (see rule 9 in
Appendix 2). This finding is not unexpected given that the cost of switching to
another job is not high for a driver who has devoted a smaller amount of time to
his/her profession. Although an increasing number of trucking firms require at
least one year of driving experience before hiring drivers, firms should target
the ones with more than five years of prior driving experience to reduce
turnover. The recruitment of drivers with more than five years of experience
may necessitate the offering of special incentives such as sign-on bonuses or a
merit pay raise incremental to years of driving experience and recognition of
experienced drivers as “mentors” or leaders with greater authority to make
their own decisions (i.e. increased autonomy). The effectiveness of these
incentives, however, can be an important subject of future research.
With this in mind, the formulation of driver recruitment and customer
retention strategy should start with the clear identification of incentives that
work for a certain profile of driver. As our data mining results indicated,
IJPDLM certain combinations of incentives have more influence on a driver’s job-
33,2 hopping behavior than a single incentive (e.g. pay raise). Therefore, in
formulating a successful driver recruitment and retention strategy, trucking
firms should consider a multitude of attributes comprised of a driver’s
demographic profile (e.g. age), longevity, prior driving experiences, union
status, and the trucking firm’s organizational settings.
158
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Rule 2
IF a trucking firm has 500 or more full-time drivers (i.e. a trucking firm is considered large),
THEN its driver turnover rate is likely to range from 51 to 100 percent.
IJPDLM Rule 3(a)
IF a trucking firm has 1 to 49 full-time drivers in the range of 1 to 49 (i.e. a trucking firm is
33,2 considered very small)
AND is located in Illinois, Missouri, or Ohio,
THEN its driver turnover rate is likely to range from 1 to 10 percent.
Rule 3(b)
160 IF a trucking firm has 1 to 49 full-time drivers (i.e. a trucking firm is considered very small)
AND is located in Tennessee,
THEN its driver turnover rate is likely to range from 11 to 50 percent.
Rule 3(c)
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IF a trucking firm has 1 to 49 full-time drivers (i.e. a trucking firm is considered very small)
AND is located in Kentucky
AND is a regional truckload (TL) carrier,
THEN its driver turnover rate is likely to range from 11 to 50 percent.
Rule 3(d)
IF a trucking firm has full-time drivers in the range of 1 to 49 (i.e. a trucking firm is considered
very small)
AND is located in Indiana
AND is a regional truckload (TL) carrier,
THEN its driver turnover rate is likely to range from 1 to 10 percent.
Appendix 2. The summary of IF-THEN rules for the impact of driver profiles on
driver turnover
Rule 4
IF a truck driver has stayed with the same trucking firm for 11 years or longer
AND has been associated with a very small trucking firm (with the number of full drivers
ranging from one to 49),
THEN the likelihood that he/she would leave the trucking firm is 1 to 10 percent.
Rule 5
IF a truck driver has stayed with the same trucking firm for 6 years or longer
AND has been associated with a small or medium-sized trucking firm (with the number of full
drivers ranging from 50 to 499),
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 6
IF a truck driver has stayed with the same trucking firm for less than six years
AND has been associated with a trucking firm with the a large percentage (50 percent or more)
of part-time drivers,
THEN the likelihood that he/she would leave the trucking firm is 51 to 100 percent.
Rule 7 (a)
IF a truck driver has stayed with the same trucking firm for less than six years
AND has been associated with a trucking firm located in Tennessee with a very small
percentage (10 percent or less) of part-time drivers
AND has less than 6 years of driving experience,
THEN the likelihood that he/she would leave the trucking firm is 51 to 100 percent.
Rule 7 (b) Recruitment and
IF a truck driver has stayed with the same trucking firm for less than six years
AND has been associated with a trucking firm located in Tennessee with a very small retention
percentage (10 percent or less) of part-time drivers
AND has six to ten years of driving experience,
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 8 (a)
IF a truck driver is hired by a trucking firm located in Ohio
AND is offered an annual starting salary of $25,000 to $34,999
AND is in the age group ranging from 26 to 35 years,
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 8 (b)
IF a truck driver is hired by a trucking firm located in Ohio
AND has been offered an annual starting salary of $25,000 to $34,999
AND is in the age group of either 21 to 25 years or older than 35 years,
THEN the likelihood that he/she would leave the trucking firm is 1 to 10 percent.
Rule 9
IF a truck driver has stayed with the same trucking firm for less than six years
AND has one to five years of driving experience,
THEN the likelihood that he/she would leave the trucking firm is 51 to 100 percent.
Rule 10
IF a truck driver has stayed with the same trucking firm for six to ten years
AND works for a unionized small trucking firm with less than 50 full-time drivers,
THEN the likelihood that he/she would leave the trucking firm is 1 to 10 percent.
Rule 11
IF a truck driver has stayed with the same trucking firm for less than six years
AND has been associated with a relatively large trucking firm (with more than 500 full-time
truck drivers),
THEN the likelihood that he/she would leave the trucking firm is 101 percent or more.
Rule 12 (a)
IF a truck driver has stayed with the same trucking firm for less than six years
AND has been associated with a small trucking firm with 50 to 99 full-time truck drivers
AND is in the age group ranging from 21 to 25 years, 31 to 35 years, or 41 to 45 years,
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 12 (b)
IF a truck driver has stayed with the same trucking firm for less than six years
AND has been associated with a small trucking firm with 50 to 99 full-time truck drivers
AND is in the age group ranging from 26 to 30 years or more than 46 years,
THEN the likelihood that he/she would leave the trucking firm is 1 to 10 percent.
IJPDLM Rule 12 (c)
IF a truck driver has stayed with the same trucking firm for less than six years
33,2 AND has been associated with a small trucking firm with 50 to 99 full-time truck drivers
AND is in the age group ranging from 36 to 40 years,
THEN the likelihood that he/she would leave the trucking firm is 51 to 100 percent.
Rule 13 (a)
162 IF a truck driver is hired by a very small trucking firm with less than 50 full-time drivers and less
than 10 percent are part-time drivers
AND is 46 years or older
AND is offered an annual starting salary of less than $25,000,
THEN the likelihood that he/she would leave the trucking firm is 51 to 100 percent.
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Rule 13 (b)
IF a truck driver is hired by a very small trucking firm with less than 50 full-time drivers and less
than 10 percent are part-time drivers
AND is 46 years or older
AND is offered an annual starting salary ranging from $25,000 to $44,999,
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 13 (c)
IF a truck driver is hired by a very small trucking firm with less than 50 full-time drivers and less
than 10 percent are part-time drivers
AND is 46 years or older
AND is offered an annual starting salary of more than $45,000,
THEN the likelihood that he/she would leave the trucking firm is 1 to 10 percent.
Rule 14 (a)
IF a truck driver is hired by a medium sized trucking firm with 100 to 499 full-time drivers
AND is offered an annual starting salary of less than $25,000,
THEN the likelihood that he/she would leave the trucking firm is 51 to 100 percent.
Rule 14 (b)
IF a truck driver is hired by a medium sized trucking firm with 100 to 499 full-time drivers
AND is offered an annual starting salary above $35,000,
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 14 (c)
IF a truck driver is hired by a medium sized trucking firm that is located in Illinois, Indiana,
Kentucky, Missouri, Mississippi, or Pennsylvania with 100 to 499 full-time drivers
AND is offered an annual starting salary of $25,000 to $34,999,
THEN the likelihood that he/she would leave the trucking firm is 11 to 50 percent.
Rule 14 (d)
IF a truck driver is hired by a medium sized trucking firm that is located in Ohio or Tennessee
with 100 to 499 full-time drivers
AND is offered an annual starting salary ranging from $25,000 to $34,999,
THEN the likelihood that he/she would leave the trucking firm is 1 to 10 percent.
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