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Already, several comments saying how being a truck driver is a tough job (it is!) or "that's what they have to pay to get decent drivers". But whether the job i
by hyperpape 3y ago
Already, several comments saying how being a truck driver is a tough job (it is!) or "that's what they have to pay to get decent drivers". But whether the job is hard, isn't the question, and the second comment is sort of vaguely accurate, but just ignores the interesting part. From the article:
> One of the best jobs you can get in trucking is at Walmart. The uber-retailer says truck drivers can make up to $110,000 in their first year at the company. That’s twice the nationwide median pay of a truck driver
The interesting question is: why does Walmart pay so much more than is typical? Unfortunately, the article gives a pretty superficial analysis.
Edit: to forestall helpful comments, I am aware that businesses often make an effort to do things based on a kind of sophisticated analysis where they compare the upside of doing the thing ("benefits") to the downsides ("costs"), and then do the thing if the upsides seem to exceed the downsides.
The question is, why is it that this significantly above market rate is what Walmart thinks maximizes its benefits compared to costs?
- eschneider 3y agoThe cost of not having a reliable supply chain is much more than they're paying their drivers. It's just good economics to pay more to reduce driver turnover.
- manicennui 3y agoProbably takes away a lot of drivers from their competitors too.
- savanaly 3y agoWhy is it not good economics for their competitors to do so as well?
- hanniabu 3y agoLess scale, easier to fill gaps, less impact
- adventured 3y agoWalmart has basically always been superior to its competitors at logistics. It has been one of their key competitive advantages for many decades. They have been a data monster heavily focused on logistics for most of their existence (I've been reading about their various logistics advantages for 30 years now). Even if doing a thing is good for a competitor, that obviously doesn't mean that competitor will do said logical thing. Companies fail all the time because they're incompetent in one form or another (or many forms).
- paxys 3y agoAny reputed tech company pays entry level engineers 2-3x more than the industry average. There's no complicated reason behind it. They just want the best talent. There are plenty of $50K/yr programmers out there but they aren't going to write the kind of code you want. I imagine it's the same for truck drivers.
- lebean 3y agoThere are plenty of <$50k programmers making 6 figures, so I'm not sure that's it.
- DarmokJalad1701 3y ago> There are plenty of <$50k programmers making 6 figures Doesn't that make them not "<$50k programmers" by definition?
- giantg2 3y agoSkill wise I'm probably in the bottom quartile, but I make about the national median.
- mettamage 3y agoThis is not a thing in NL unless you do HFT programming. One of the reasons why the US pays so much seems to simply be that the economies of scale are there.
- badpun 3y agoI don't think it's economies of scale. Top money in US is paid by tech companies (FAANGs and similar) who have virtual monopolies on their markets, and thus are printing money. They overpay for programmers to make sure they're not outcompeted on tech and retain their monopoly status. Second crucial factor is the VC ecosystem unlike anything else in the world. VC-fueled startups (even late-stage ones, like Uber) will also often pay way above market for programmers, because they believe programming talent is the way for the startup to dominate the competition and become a money-printing monopoly. Europe and rest of the world does not have anything like that. There's no serious software industry (aka "tech") there, neither large and estabilished nor VC-fueled. Programmers are seen as a commodity and not a source of competitive advantage. And, even if there are exceptions, they're not common enough to start bidding wars for top talent which in the US elevated the salaries of top ICs to $300k-$400k.
- wharvle 3y agoComparing “up to” with median is setting off my bullshit alarm.
- lupire 3y agoThe Quota consensus is that the thesis of the OP is simply misinformation, as expected. https://www.quora.com/Walmart-is-offering-new-truck-drivers-a-110K-salary-How-much-of-a-raise-is-this https://www.quora.com/Walmart-is-offering-new-truck-drivers-...
- mathgradthrow 3y agoMisinformation or advertising?
- elil17 3y agoOften the same thing
- nonethewiser 3y agoGood catch. That's a bullshit comparison indeed.
- olyjohn 3y agoThen it's always "... well including the health insurance and retirement package which we estimate costs us $75,000/yr." So actual take home wage is never near $110,000.
- andy99 3y agoIs it significantly above market rate when adjusted for experience level and overtime? They say "make up to" which is meaningless (maybe that's a 20 year driver hired for a particularly unpleasant route in a tight market). And I know some truck drivers can get overtime doing extra shifts which can make up a lot of their income. I'd like to see a real comparison between the experience level and kind of driving (long/short haul, day/night whatever other industry divisions) vs the median income rather than the meaningless comparison with the "up to" number before drawing any conclusions about how well they pay.
- bluGill 3y agoI would guess that WalMart assigns drivers to a route, everyday they go from the warehouse to the same WalMart(s). Most days there is no overtime - they keep every walmart within a days drive of two warehouses so if one warehouse fails (fire...) they can shift everything - that means some drivers will need to go to a different warehouse and then they need enough slack to pay for that extra overtime without running out of time in a day (a day is less than 24 hours for drivers)
- newsclues 3y agoWhy? Because they have to to maintain their logistics network to continue operating and making money. They have a business that prints money so they can afford to pay more to continue operating. People will stop going to Walmart if they can’t stock the shelves, or raise prices because they use other shippers that charge more.
- deleted 3y ago[deleted]
- wodenokoto 3y agoI agree that both the article and the comments section gives very unsatisfactory answers. “They want good truckers.” Sure, but not good cashiers? Why does Walmart want good truckers and Target doesn’t?
- TylerE 3y agoWalmart has a lot of SKUs made just for them - and that's not even getting into the house brands. I bet their logistics works quite a bit differently than the average retailer. Cashiers are easily replaced, and don't have to pass DOT drug tests or maintain licensure - a CDL is a big deal, and even minor traffic violations including while driving a personal vehicle off the clock can impact it.
- TylerE 3y agoYou can actually see something similar in the pharmacy market. Pharmacy techs are both very in demand and ironically also often leaving the profession, because many are just tired of the every increasing workloads (perennially short staffed...) and deteriorating conditions.
- snapetom 3y agoBecause the skillset required to being a good truck driver are astronomically higher than being a good cashier.
- HPsquared 3y agoA trucker can make much bigger mistakes than a cashier.
- savanaly 3y agoIs that not true at other companies as well?
- PaulHoule 3y agoThe general standard in the industry is pretty bad. My brother-in-law, who has a CDL, tells me somebody wedges a tractor-trailer into the Tompkins Street bridge in Binghamton about once a month because they ignore the clearance warning signs. My understanding about Wal-Mart is that trucking for them is a good job because you get to sleep in your own bed. That is, the distribution center is close enough to the store that you can drive for them and live a normal life, it's not like driving trucks all the way across from the US. Normal trucking companies are always having workers say "take this job and shove it" and then struggling to get their cargo moved, truckers know they are in demand enough they can quit without notice, take a few weeks off, then start up at the next place.
- soared 3y agoWouldn’t that enable Walmart to pay less, since the job itself is better?
- HPsquared 3y agoIt must contribute. Their pay would probably be even higher otherwise.
- ElevenLathe 3y agoThe point is that a delayed truck is very expensive, so it ends up being cheaper to pay efficiency wages and have good working conditions so people aren't constantly quitting and therefore delaying your trucks.
- PaulHoule 3y agoWal-Mart was also a pioneer in just in time delivery for retail. If your supply chain is reliable you don't need to pile merchandise as high in your stores and your warehouses. People will drive an hour to Wal-Mart(s) in the most rural locations and in that case it is a real bummer to be out of stock. I'd contrast that to K-Mart where I went to get 3 digits for my mailbox and could only get 2 of them so I didn't buy any.
- 3y ago
- deleted 3y ago[deleted]