An earlier Recruiting Daily Advisor article cites research from nonprofit Human Resources association WorldatWork, which finds the number of companies using sign-on bonus programs stands at a 15-year high.
A sign-on or hiring bonus, defined as a cash bonus given at the beginning of a service period, usually for accepting an employment offer, hasn’t only become more common. In some instances, the dollar amount offered to lure job candidates has increased significantly.
Working on the Railroad
What’s more, such bonuses aren’t only being offered to executive-level candidates.
The Wall Street Journal reports that BNSF Railway and Union Pacific Corp. are offering railroad workers up to $25,000 to sign on the dotted line. Union Pacific is offering its top bonuses to electricians to inspect, repair, and maintain locomotives. It is also offering $10,000 to $20,000 sign-on bonuses to railroad crews.
The hiring incentives are substantial, especially in relation to salary. The Journal reports that crew jobs average $40,000 in pay over the first year and $60,000 the next.
Why so much? The short answer is that freight railroad companies are desperate for workers. A low national unemployment rate, and even lower regional unemployment rates in locations where the railroad jobs are, has created a worker shortage.
If this weren’t problematic enough, the Journal reports that at the same time, freight volumes are rising due to strong economic growth and a shortage of truck capacity.
Keep on Truckin’
A worker shortage is to blame for “a shortage of truck capacity.” And, like the railroad industry, the trucking industry is attempting to attract workers with sign-on bonuses.
Research from HireRight, a background screening company, finds that as more truck drivers retire, companies face challenges attracting new drivers—and the trend is expected to continue. The average age for truck drivers is 52, and that number continues to increase every year, according to the National Transportation Institute (NTI). Currently, 69% of companies in the transportation industry report that their number one challenge is finding qualified job candidates.
Among the steps being taken to address the situation is the sign-on bonus. Approximately 32% of trucking companies offer sign-on bonuses to new hires, according to HireRight research.
The amount of sign-on bonuses for drivers has indeed increased significantly, in just the past year. American Trucker cites NTI analysis that shows a median jump of 280% for dry van carriers and 300% for refrigerated carriers in bonus amounts from 2017.
Roehl Transport is currently offering a $10,000 sign-on bonus to experienced drivers. Schneider, meanwhile, is attempting to get more bang—and more employees—for its buck by offering a team bonus. A driver and partner, if hired, receive a team driver bonus of up to $20,000.
|Paula Santonocito, Contributing Editor for Recruiting Daily Advisor, is a business journalist specializing in employment issues. She is the author of more than 1,000 articles on a wide range of human resource and career topics, with an emphasis on recruiting and hiring. Her articles have been featured in many global and domestic publications and information outlets, referenced in academic and legal publications as well as books, and translated into several languages.|