Why Walmart pays its truck drivers 6 figures
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This feels like a globally true statement, regardless of the employer, no?
OTR trucking overall pays pretty well, but it's an extremely physically and emotionally taxing job that doesn't really get the credit it deserves. How would you feel if you were "home" for a weekend every 2 weeks and living in 20sqft the rest of the time?
Absolutely. If a driver is at fault in an accident, Walmart will get sued for $zillions.
I once knew a middle aged man laying tile. I asked him why was he laying tile for crap wages. He said he lost his trucking license because he had a DUI (not while trucking). Doing construction was the only job he could get. He was quite bitter about it.
Source: https://wisconsindot.gov/Documents/dmv/shared/cdl-disq.pdf
Even the lower rate such as concrete laborers wanted 100+ an hour.
I suspect the low pay of many of these trades is just a symptom of housing and construction being the number one money laundering industry and thus tradesman are always saying they're making nothing while simultaneously asking 100+ an hour cash and working full weeks.
Id bet the BLS income reports are off by like 50+%.
It's not too hard to get cash-only "customers" to buy services you don't have to actually perform.
It's also pretty easy to write two invoices, feign a mixup, and skim some off the top of a payment.
I agree that in my experience a lot of contractors would rather deal with cash and it isn’t exactly a secret why. I got a significant all cash discount on a new roof.
He wasn't driving for Walmart of making that kind of money then, so I hope he was able to move into a different career that didn't do further damage.
It's not a job I'd want to do. Ergonomics aside, I find driving to be very unpleasant in large doses. Having to put up with traffic, shitty drivers, weather, and everything else 8-12 hours per day is not my idea of a great time.
"Healthy foods" are going to be largely inaccessible through long sparsely-populated stretches of the country. Even where they are available - in markets, fruit stands, etc. pulling your huge truck off the road to park is expensive (in terms of time) and difficult (in terms of space). Truck stops have the infrastructure for your truck. But their food selection is mostly junk.
Please don't reply "sitting down all day". I have been doing that for more than 20 years in a comfortable office (mostly Hermann Miller Aeron), and my back is fine.
My guess: The vibrations of the truck are awful for your bones.
Driving freezes your body into one position for hours on end. Doing it in a car for a few hours on a road trip makes my neck hurt. Doing it every day would be deleterious very quickly.
I work at a computer at a desk, but the ability to stand up at will just to use the toilet makes a big difference. Can’t do that driving a truck.
I worked at a few Home Depots and IIRC the store managers were clearing 150-250 while the assistant managers I think were in the 60-80k range. Then us floor staff were 9-15, maybe 20. This was 2008ish.
I remember the biggest HD in my state or somewhere the manager was getting I think 500k-1mil+. You can infer it from the numbers the store does and their bonus percentage whatever that was.
My mom was an HR director there so corporate as well and she made somwhere in 130-200+ not sure exact.
Isn't that ... good?
The demographic in every region or neighborhood is different and has different tastes, incomes and budgets, so it's your job as store manager to identify the needs of that demographic, and order merchandise and organize it on shelves, run sales, etc. in order to move as much of it as possible to maximize sales and profits. Sort of like targeted advertising but IRL and less privacy invasive.
Paying based on this seems like the only way to incentivize this performance.
I quit mid june after I realized they weren't hiring/scheduling more staff for the summer even though every day was very busy, constantly running between helping customers and taking care of other things.
There are a lot of ways to make profit and show good metrics that aren't good for line employees.
Sure, but this is in line with every major (European) tech company I ever worked at. Pay employees peanuts and pay senior mangers amazing, therefore you were incentivized not to do well as an IC, but to put up with bullshit and fight your way to climb the corporate ladder to management, and then exploit the other poor schmucks who come below you with the same perverse incentive structure.
Yes this leads to a huge turnover, unhappy workers, and to a lot of arguments, back-stabbings and fights. But their stocks were always rock solid and managers were always wealthy so I guess they saw that culture as a net win. It seems to be the M.O. with ever major company everywhere, I think it's called the "GE model".
Paying ICs at the bottom great wages and incentivizing them with stock, is mostly unique to US/SV and new-age software start-ups from the Google/Facebook era, but rare everywhere else.
I got this feeling that what's most important for a Big Bad Company is to be able to get well of with management of other Big Bad Companies to be able to land contracts.
It works because it prays and exploits several flaws in our society and in human psychology like greed, wealth inequality, conformity of the masses to cultural norms, fear of missing out/of being left out, and the crabs in the bucket mentality, which leads to a rat race to the bottom form which it's difficult to check yourself out as an individual if the majority does it and is heavily vested in it.
This isn't something big bad corporations have created, it s just something that has existed for hundreds of years, they're just exploiting. The same mechanism and behaviors were in place during the communist rule in my home country 35+ years ago, when people were fighting to climb up the party ranks, because that's what gave you the best QoL. Now it's climbing the corporate ranks.
Because it's cheaper to compensate one manager 10x average (and get the best candidate) than pay more to hire an entire team of more skilled ICs.
FAANG gets away with it because they amortize their engineering costs over an extremely customer base. Which also multiplies the value in output quality difference.
Most companies are not building EC2 or BigTable.
And so... it makes more sense to hire minimal cost engineers, then corral them with a single high-cost manager.
I don't think you get better managers by paying them more though, over some threshold. You'd probably just get more "competetive" managers in the meta game of becoming a manager. Like engineers at Google are not some elite just becouse they are paid more. Only athletics actually can be evaluated in an accurate enough manner I believe.
But it's likely a direct transfer from sales or retail orgs, where it's very much measurable and true.
Only for those at the lower end, usually at the expense of growth and opportunities for those at the higher end, but since those are fewer in number their votes are less important.
>How is it that European tech workers can't bargain for higher wages?
Because investors there don't have as much money, and those who do don't risk it starting tech companies. And also because Europe is not a single country with one law and one language, but 27+ with different laws and different languages, means scaling a business beyond the original country is difficult and expensive.
It's the US who's the exception in tech success, not EU for failing to match it.
The leverage a company has and the leverage a union has both come from the same place: A lack of alternatives. But then that's the problem.
If you have a competitive industry, the union can't demand much because the company's margins will be slim and they won't be able to give the union much without raising prices, losing customers to competitors and going out of business. This is actually fine because in that case workers still get the money in the form of lower consumer prices, but then it's not the union which is getting you the benefit.
Conversely, if the industry isn't competitive then the company will be a huge conglomerate with a lot of leverage against workers/consumers. They'll be big enough to exert political influence in the government and also big enough for the company's union to become infested with politics. In particular, the union knows where its leverage comes from, and it's workers with skills in high demand, so any union that doesn't keep them happy and keep them from moving to another company/industry is going to have to contend with a pissed off conglomerate with a lot of political influence. So the money goes to the people with high demand skills (or political connections) and the rank and file still get the scraps, but now it's even worse because lack of competition and high levels of organizational inefficiency means high prices when they go to buy things.
It sounds like you have never worked busy retail, more than anything else. You wouldn't accept your own job being that level of busy dealing with unserved and frustrated customers at that pace.
For whom?
Perhaps it can work situationally, but I've not seen it anywhere I or any of my friends have worked.
If your goal is long-term success, those incentives might be misaligned.
If the pie was shared more fairly, then yes they would be better off and I daresay that their incentives would be better aligned with getting those numbers up. And yes, that would mean managers not pulling down millions.
I worked retail in high school and college in the same era as you mentioned and even 20 years ago, a store manager at a Best Buy or a Costco was clearing $250k or more, at least in the wealthier-Atlanta area where I lived (I know a lot of HD employees being from Atlanta and my knowledge of corporate and sales manager salaries at HD aligns with yours too), as you said, based in part on bonuses related to store revenue (the Best Buy stores I worked at when I was 16 - 22 were two of the top-ranked stores in the southeast region by sales, with some departments being among the top 10 in the whole company). For some of the chains, I think that has decreased as in-store sales have shifted but places like Costco notoriously pay their store managers extremely well.
Best Buy desperately wanted me to quit college and be fast-tracked into store or sales management (I would spend my summers as a manager of a department and they agreed to keep me at that elevated hourly wage even when I was part-time during the school year), trying to lure me with tales of just how much money the top of the foodchain people make, but I never took it seriously. Given the ebbs and flows of the economy (I graduated from college in 2008) and the collapse of the retail market from its early 2000s high in favor of ecommerce/Amazon, that was almost certainly the right decision -- but it was an instructive lesson for me at a young age about the very disparate differences in compensation between the hourly workers and the people at the top of those stores.
20 years later, I reckon there was a lot of storytelling here advantaging the arguments of the right-wing, but I’d still be curious what are the true figures.
the question the book asked, explictly, was then if they're making minimum wage, why not just get any old crappy job at McD's or as a janator? if you're making minimum, why not get a job where there is no risk of getting shot or sent to jail?
workin McDs or Kinkos is eating shit every day, wearing a uniform, etc. and is fundamentally emasculating when compared to gang culture.
best performing stock in the S&P500 going back to 1981
Home Depot (HD) had the highest return in 1981 by a US stock in the S&P 500 (GSPC), returning 66.9%. [1]
It is not easy to find a single stock with the highest return since 1981. The best I could find was 20 years: Monster (energy drinks) [2]
Other research shows the highest single year return on a stock ever was Qualcomm: +2620% in 1999 [3]
[1] https://www.statmuse.com/money/ask/best-performing-stocks-in...
[2] https://www.cnbc.com/2023/11/08/sp-500-stock-has-the-highest...
[3] https://www.visualcapitalist.com/top-sp-500-stocks-by-annual...
Compare that to Apple who is up about 150,000% since IPO and less since their S&P inclusion.
Don't know how it was at Home Depot, and my experience at Walmart was ~20 years ago, but asst managers were in-building 10-12 hours/day, usually there 6 days a week for various reasons, and at that time were only making $50k salary to start. Unless there were other bonuses I was unaware of, it was absolutely not worth it.
I wasn't making a living wage as an hourly associate, but they were super strict about me working beyond 40 hours, and when they "requested" beyond that (it was rare but never truly optional if I wanted to keep climbing) I was well compensated because they were terrified of lawsuits by that point. Small blessings.
I can picture the faces of all of my managers, ASMs. I can't picture the face of either of my store managers. I'm not sure I actually ever saw them. They definitely weren't in the store often.
I loved my first store and HATED my second store. If you're full-time at HD you have no control of your hours at all. They'd schedule me to close 11pm-12am then open at 5am the next day at the second store. I just quit one day. I constantly got sick from getting no sleep.
If you're part-time there you have 100% control of your hours. Tons of people in college who worked 2-4 hours a day. It was miserable watching them come and go.
She's moving every 1-3 years because they transfer her to a new store, and because she's running the higher profit stores they send her to trash stores to try and fix them. She has no practically no vacation, has to fill in staff shortages, works every weekend. I think she's around 30-40k. So she's doing all this to eventually (6 years in now) break into the corporate world, where she'll then have to move 1000 miles away to I think Georgia.
To... probably make 60k.
I'm really curious where she'll be in 5-10 years, she's managed so many stores I feel like she'd go regional manager route or something. OR training would keep her at corporate instead.
Are the people working under her unambitious and incompetent?
I don't think she'll ever wind up at corporate.
If you survived the politics of being moved from store to store, never knowing your schedule, and blatant, miserable sexual harassment ("hey let's go out for drinks and discuss how I might let you sell large appliances instead of small electronics"...oh wait..."you didn't go to my apartment...we have this opening an hour away that you have to take with no advancement opportunity".
Okay, assuming the sexual harassment is gone/obsoleted by solid company policy, there's the "chasm" from peon to management that you can only aspire to if you never make a mistake or make them quietly. Or never leave the job to get a degree. Or get lucky somehow.
Those positions at management level above peon required a lot of sweat equity and risk on the part of the worker bee. If it doesn't pan out, well, that's what...3-15 years of your real actual life flushed down the toilet.
I'm with GenX. Screw that noise.
Even a CVS will pay the GM well if they hit targets. And if they miss the targets, they get purged and there's a thousand people to replace them.
The people with limited responsibilities who are easily replacable get paid nothing. Jobs that are hard to hire competent people for get paid $$$$. Supply and demand in action.
You don’t want all truck drivers putting in the maximum hours humanly possible. It’s a safety hazard. But having to pay for health insurance makes corporations try to optimize for this at the expense of human lives.
... what?
First, I don't understand how paying for health insurance means they are trying to get the most hours out of their employees. I guess you could say thats somewhat true for literally every overhead cost including social security payroll taxes, training, heating buildings, etc. At best, it seems a little true in a very indirect way so why the laser focus on health insurance?
Second, it its truly a safety hazard then it disincentivizes employers from doing it.
I'm not OP, but my take: the health insurance cost of hiring a driver is fixed, regardless of how many hours per week they drive. Therefore, the more hours they drive, the more the employer's "bang for their buck".
> Second, it its truly a safety hazard then it disincentivizes employers from doing it.
Health and safety regulations are written in blood, and exist precisely because employers need to be forced by law to maintain safe working conditions for their employees.
Probably less true in trucking, where the leading cause of worker injury is road accidents. If, say, a roofer falls off a roof, the only damage is to the worker, but if a trucker crashes badly enough to get injured, the truck and cargo are likely damaged as well. Truckers and their employees should be more naturally aligned on safety issues.
If a particular unsafe practice produces an extra $1 million dollar accident every 200k hours of driving time, a small one man operation isn’t likely to see that happen over the course of a career. And even if they do, they may not have enough data to notice the correlation.
A company with 1000 drivers will likely deal with it once per month.
Back in the 20th C., drivers frequently took amphetamines in order to spend more time driving. Forged log books are a significant incentive for the development of electronic logs. I've seen many stories of drivers told to break hours-of-service regulations by dispatchers.
And the hours of service regs are insane (https://www.fmcsa.dot.gov/regulations/hours-service/summary-... - keep in mind "on duty" != "driving" but waiting for loads and such, which the driver is not paid for) largely to maximize the number of hours driven.
You are not required to participate in trucking, nor is it a right to do so. Choosing that career (and it's associated licensing) comes with responsibilities...
It's only violating the fifth for the part where you must admit to crimes, not all logging. I'm talking about hours logged past the maximum.
This would make sense from first principles, because unsafe truckers impose externalities beyond the direct risks to truckers and their supervisors, by making the roads more dangerous to the public.
Most semi-trucks cost about 200 000 USD. I couldn't find the value of a single truck load anywhere but there's a thread here[0] where folks are speculating it takes about 30-60 trucks to fully stock a Walmart, and a second thread where folks are talking about the likely cost to buy everything in a Walmart[1], which converges on low seven figures.
Let's maximise the truck value with these constraints, so $10M/30 = 333 333 USD.
Then we could perhaps estimate that the value of each truck is somewhere around 550 000 USD.
How many trucker hours is that? Well, let's take the number from TFA which is 110 000 USD/year, assuming an average of 10 hours per day[2] (50 hour weeks) for 50 weeks per year (even truckers need a holiday), we get a total of 2500h/year. That means that one Walmart truck is worth 12,500 trucker hours.
The 'involvement rate' for crashes resulting in injury per 100 million miles was 36 in 2021 (i.e., approx 1 every 2.7M miles).
In 12 500 hours at 45mph[2], a trucker will travel around 562 500 miles.
Wherever I've had to make an assumption, I've leaned towards it being less expensive to not have a crash (high end of value of stock in the store, low end of number of trucks, choosing to 'total' the truck in case there's an injury, etc.).
However, this very basic and unscientific examination it does seem to suggest that your immediate conclusion that the employers of truckers should be economically aligned towards protecting trucks and truckers is not supported by data.
[0]: https://www.quora.com/How-many-full-container-truck-loads-do... [1]: https://www.quora.com/How-much-would-it-cost-to-buy-one-of-e... [2]: https://www.dat.com/blog/benchmark-your-supply-chain-for-45-... [3]: https://injuryfacts.nsc.org/motor-vehicle/road-users/large-t...
When have employers ever cared about safety except when mandated by law? These things were all legally codified because people got hurt or died, not because companies wanted to be "nice"
Trucker forums are full of ways to cheat the devices like simply pulling a fuse or replacing it with one that's been burned out, and police can't / won't check electronic logbooks because it's too much of a hassle for them.
The companies installing the electronic logbook devices are the same people who have incentive to cheat the system. So do you think anyone notices, complains, or gets disciplined when "the fuse keeps burning"?
This means that what you're replying to was absolutely true.
Sure they have breaks, but is it really spare time of you're stuck in a truck in the middle of nowhere waiting for time to pass so you can drive again?
The industry shifted to electronic logbooks and while there was initial resistance, truckers quickly learned they could just pull fuses, or cover GPS antennas...and that police officers would look at paper logbooks but didn't have the equipment or interest to pull electronic logs.
Truckers in the US do whatever they please, and the rest of us pay the price when they crash and kill others or dump toxic crap everywhere.
I think it is 11 hours per day, with a minimum rest time of 10 consecutive hours.
I am sure that WalMart demands full compliance with all regulations and is very exacting in pick up and delivery times. Likely drives are doing the same routes all the time. A lot of drivers would find that boring.
that said, there are a lot of deliveries that are not the same thing to the same place. while they are a minority overall, there are still a lot. If you work for a big national shipping company (WalMart is not this even though they are national) you can ask for a delivery to anywhere - they always have a single delivery to some random location. Though if you want to go to rural states - many other drivers grew up on a farm and truck driver is one of the few well paying jobs they can get without a degree on so there is a lot of others wanting that. (If you want to go to a big city there are plenty of delivers and less drivers with reason to want them)
Driving a new route (in his work) was generally not considered "exciting" - but taxing.
> very exacting in pick up and delivery times
Well, for us, not exactly. For our last contract with Walmart, there was a lot of language about timing. If the driver arrived and the order wasn't ready for pickup, we'd be penalized for every hour of delay. The penalties were such that you could end up losing crazy money on the job if you weren't confident about your abilities to deliver on time.
Not a big deal for us since we were tight, and could easily handle it.
Then Walmart arrived a day early. The driver had made a choice to stop for us first, which, after pulling up the contract, we realized it allowed for that. Our lawyer had determined it was vague enough that the agreed delivery date would prevail, contractually. Which is probably why we didn't notice that the contract also said the pickup clock started the minute the driver arrived, and that was also the official pick up time. Had we caught that during contract negotiations, we'd have refused the terms. But we missed it.
We weren't a small shop. We already ran two shifts, and quickly needed to pull in a third to be able to finish in time to get any profit out of the job.
We almost did that last contract with zero profit, and refused all business from Walmart after that day.
Thing is, I've heard of similar stories where Walmart would do similar tricks with produce from farms. Whether myth or not, I don't know, but I know with certainty how they treated us. There were probably incentive structures in place for drivers to show up early, and some of them had the balls to do it a lot earlier than others. In this case, they could give the driver an bonus for his better than on-time averages, then "buy" goods worth a retail $5M+ for the cost of the driver's salary and bonus, plus whatever the supplier (us) managed to keep after penalties.
I'd be interested in actual data. Employee satisfaction/retention and associated hiring costs and increased maintenance/higher failure rates because no one has "ownership" over the truck aka diffusion of responsibility happens are where I could see that calculation break apart.
It’s similar to lowering inventory. Sure you can run into problems with smaller buffers, but at least you see the problems and have a chance to act accordingly.
living wage is an aspirational goal. it doesnt tell you much about if 100k is a huge step up or down from typical jobs.
https://www.glassdoor.com/Salary/Walmart-Truck-Driver-Salari...
Looks like top reported are at $75k.
If they're paid higher than average, then how could a union fight to get them higher wages when they aren't doing it for the unionized competitors that have lower?
And also per another comment here, they require an unblemished driving record. So if the worst concern of unions came true, that they can make it hard to fire bad performers and require hiring "their guys", then drivers with blemished records can make it in and stick around. That means the good drivers currently employed may see their value drop comparatively and likewise their ability to demand better pay.
As it stands it seems like the current drivers then have the benefit of being considered best in industry and may prefer to gate-keep and not unionize as a result in order to protect themselves.
I wonder if other companies that want to fight unionization should do similar: hire top performers and pay them well :)
I mean this also applies to the rest of Walmart, or at least it did
In high schoool and college (98 through early 00s) at age 16 I initially worked at a local grocery store chain that was unionized making minimum wage. They went out on strike for a month and came back to just a ten cent raise. Not long after that I went to work at Walmart making about 40% more, with a 10% discount on anything I wanted to buy in the store
Working conditions between the two were not much different, both were pretty transparent on scheduling, job duties, and the like
Now, I'm pretty left wing and I support the right to organize without any restriction, but I probably would've voted against a union if the UFCW had come to my Walmart store asking for signatures based on my prior experience with them
Does that mean unions have a place? Absolutely. We would not have the meager protections we have today without unions, and they serve a deterrent against employers running amok, but yeah treating your employees somewhat decently is plenty to keep them at bay
But still, looks like this is why software engineers are very allergic of union. The same environment already guarantees those properties and adding union on top only makes it sour. That environment's disappearance lately make union possible once more.
Source: two good friends that drive truck for a living. One in Iowa and the other in Michigan
Why wouldn’t it be highly paid?
There's many jobs that are probably even worse and paid less. The only reason it's highly paid is because the competition for it is higher: "at the time it was because of a “shortage” of truck drivers."
To pass the training you need to be a competent driver. It isn't as easy as you make it out to be and the pool of people who can become truck drivers is smaller than you think it is.
Loads of drivers fret parallel parking. Imagine the difficulty of moving a 54' trailer perfectly straight into a bay at the bottom of a narrow ramp and not crushing anything in comparison to regular parallel parking.
Driving as a profession does not require skill.
Now, is it possible that in the 1970s your dad had an unhinged boss who expected a 16 year old to reliably operate commercial trucks without any training? Is it possible your dad is an exceptional driver who managed to do this? Sure, both of those things are possible. Is it a reasonable thing to expect from any randomly selected teenager? No.
how can say this with a straight face?
I got stuck going round the first corner, then got lost, then gave up when I had to back the trailer into the loading bay.
Come back and tell us that that doesn't "require skill".
It turns out its one thing to do a thing for fun or small periods totally a different ball game when you have to do it at scale.
Im guessing a lot of people who can play a chord or two like to imagine it can't be that hard to be a concert musician either.
Everything changes at scale and when it has to be done seriously.
Miss me with the demanded respect for an industry that will be replaced in a couple decades.
Some might say the same about gluing together boilerplate in modern development frameworks.
At the end of the day, skill is only relevant for competition within a given industry. The pay scale for any given field is based on the value they provide the employers (which is why grown men playing children's games are paid millions of dollars)
Trucking is a hard job which affects the supply of drivers, but this is offset by the fairly low barrier to entry to trucking.
Just supply and demand. Demand is a function of that business value (among other attributes).
Also consider that minimal academic education and minimal specialized training is often sufficient to do the work. So the supply of those willing to do the work has often exceeded demand, so there's naturally downward pressure on pay.
These sorts of comments confuse me because they seem to be making an argument by explicitly confusing is from ought as an intentional rhetorical technique.
He'd be wrong if he thought anything else. Obviously supply and demand always determines price. There is no question on that front.
The only problem with the previous comment, perhaps, is thinking that this particular gruelling/isolating work leads to fewer people being willing to drive the trucks than actually happens. The reality is the average trucker running typical routes isn't really experiencing anything all that gruelling/isolating in the grand scheme of things, so it is a more attractive career than suggested. It's not a cushy programming job by any stretch, but it's still quite comfortable compared to a lot of work out there.
The general premise is valid, though. There are clear examples of other, albeit arguably more, gruelling/isolating work that can't get anyone to even consider the job without big dollar signs. He is just overestimating how undesirable trucking in particular is. For a lot of people, trucking is their ideal career.
But, in fairness, the comment was in reply to an article that suggests, at least for some routes, that there is trouble attracting drivers. So it wasn’t exactly off-base. The original article may be.
All that said, I think the question isn't whether the pay is acceptable, but why Walmart pays so much relative to other companies, where the drivers do pretty much the same job.
Dirty and dangerous work attracts fewer workers.
High-utility work is worth more to the employer so there will be more job offers.
When you see dirty, dangerous, high-utility work that pays poorly, it's because there's a ton of people who are willing to do it.
Walmart requires a consistent level of output which they hope can be maintained by keeping truck drivers happy with high pay. Other trucking companies can afford to have some drivers leaves and thus pay them less because they have some leniency for delays which Walmart cannot/will not tolerate
Costco, which is likely the closest analog to Walmart in terms of scale and logistical requirement, pays the same.
> 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?
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).
Doesn't that make them not "<$50k programmers" by definition?
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.
On the supply side of high salaries I think the economy of scale actually have some impact by creating a higher "floor". For example I would almost wager that every European country have their own Salesforce company (non-SAP web based CRM from early/mid 00's), but the e.g Latvian alternative never broke out to the wider EU. Whilst Salesforce conquered US and then the globe. This puts upward pressure on the virtual monopolists / VC-fueled companies that don't really exist outside the US. Imagine if almost every single B2B software company in the US spent their first 5 years only operating within a single state, and many never expanding outside.
But I think the "demand side" is even more important. Most European countries have lower take-home salaries for large parts of the salary spectra, definitely the top quartile. The reason for that are also numerous. But we generally have high taxes on an individual level, high payroll taxes, high VAT etc. In exchange for that we have large welfare states with larger redistributions both across individuals and across time for the same individual (paid parental leave, pension etc).
https://www.quora.com/Walmart-is-offering-new-truck-drivers-...
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.
“They want good truckers.” Sure, but not good cashiers? Why does Walmart want good truckers and Target doesn’t?
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.
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.
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.
When you don't pay well, you probably miss out on the hires that learned all the skills, what corners to cut, what corners to not cut, what actual lead times are, etc when hiring.
Aside from that in order to drive one of these trucks, you require a CDL, which you have to get on your own, and maintain on your own, all at your own expense. The pay is there to attract talent from a limited pool of available workers and to ensure they show up to work on time and make deliveries on time.
It would be against their own interests to try to cut corners and pay drivers less based upon these types of "benefits."
This could justify Walmart paying UNDER the median wage, but why is Walmart paying considerably ABOVE the median wage?
It turns out that good truck drivers could also be doing other useful work, and want to be well compensated and taken care of for their labor.
is basically the same thing as
> there's a shortage
If anyone wants to work on this problem with me without solving the self-driving truck / Aurora problem outright - I think the answer is something like remote operation, level 3-4 autonomy for highways, and nice comfy air conditioned driver hubs in cities so nobody has to be away from home for days at a time. Boom - all the drivers come back and get paid decent wages to drive trucks. Ideally the per-truck subscription fee for the service is an add-on to the cost of doing driver business.
I'm not referring to "sim", I'm referring to remote piloting. Real time sensor and controls feedback from a truck that is only autonomous when it makes sense to be. We can pilot drones over 100s of yards in real time without a hitch. We just need a bit more range (few kms) via, say, the internet, and you can do this fairly easily. I don't see a research problem, I see a funding problem and an aversion to autonomous trucking b/c people think it's either completely infeasible, or completely solved by Aurora. I'm not sure of either.
Just to add spice the convo: Backing into a loading bay is quite easy, autonomously. Once you stage the truck you can push a button and just watch it go. See: https://outrider.ai (which is where I work, and we do all the staging _also_, but I'm actually interested in "everything else" as well). There's a lot of very human-ish problems to get to that state, that I think remote operators can really help with.
I've long thought that to renew your drivers license you should have to spend a day every few months in a simulator to prove you can drive safely. Do you maintain a safe following distance? Can you maintain the speed limit? Do you stop for pedestrians? Do you zipper merge correctly? Here is a situation where someone else screwed up and you will crash, can you choose the best crash? Here is an icy road, can you control the car? there is a lot that modern simulators can do but few people have used them.
Interestingly: The base CDL is a one and done skill test. There are no CPEs like with other regulated industries (nurses/teachers/investment advisors) - but there is a health and fitness check.
Freight tech companies have been talking about automating every BUT the last mile/last few miles for years. Have a stable of drivers who you have on hand to take over the last hour of a delivery. Automate everything else.
There may be some limited use cases for remote operation on specific local routes where sufficient network access points can be provisioned.
Having a pod with local drivers near major hubs, for example, means the drivers take over when the trucks get close enough for it to matter. It wont' work for delivery to, say grocery stores (which can be local driving anyway), but it will work for center-to-center transport ala between Walmart hubs. It's the long haul OTR trucking that has high attrition / people shortages, because you're away from family for so long. That little bit can be somewhat autonomous, with handoff of remote operators only near hubs. Think air-traffic-control for trucks and hubs, except probably more hands on than just telling it what to do.
https://projects.research-and-innovation.ec.europa.eu/en/hor...
is basically the same thing as
> there's a shortage"
No, it's not. It means the drivers are not being paid enough to stay, as they explicitly say is the reason they're leaving.
>If anyone wants to work on this problem with me
Sure, here's the solution: pay the drivers more. Problem solved.
therefore
> drivers leave the industry
therefore
> there's a shortage ... at the going wage
I don't see how we can argue over the problem statement. We can argue over the solutions, of which there are infinite, but at least two:
1. increase wages
2. decrease shittiness of the job via ideas like mine
Or why not both? The only dichotomy here is a false one you've introduced.
>We can argue over the solutions
No, we can't, because there's no solution needed to this non-problem artificially created by employers unwilling to pay enough to attract and retain employees.
Your ideas aren't needed except by the employers trying to perpetuate their false self-made "shortage", all to avoid just paying employees more.
The only actual problem is uncritically accepting the narrative of the employers as you are doing here.
OK, well, let's not mince definitions. For the purposes of my thought process, a shortage is defined as "Number of people we want to do a job" minus "Number of people who do that job". The semantic difference between that and what you said is so small as to be negligible to me and doesn't preclude "increase wages" as a solution. I think that's fine for you to have a preferred solution or even a different preferred definition.
Again, there is no actual problem here, just an artificial one created by employers unwilling to pay their workers and crying about it. Don't buy into it.
At the end of the day, society (in the form of government regulation) gets to decide what is and isn't an important job (i.e. government subsidies), and we the people can certainly put our thumb on the scale.
People collectively decided truck drivers were overpaid [relatively] in the 1970s, hence the deregulation of the trucking industry which led to a collapse in trucker's salaries. No use blaming employers here - it was decided by the government (representing the people of the U.S.)
In this case it is. The discussion is about how employers have a dream that isn't being realized. They are metaphorical 10 year old-boys drooling over the idea of owning a Ferrari, without the capability to actually buy one.
The only "problem" is that their dream is remaining a dream. Which isn't actually a problem. Dreams aren't supposed to be realized. They are meant to be just dreams. Who gives a shit if a 10 year old can't own a Ferrari? And that is what the parent is pointing out – that the '10 year-old cries' of business are meaningless. Let them dream, but it ends there.
If people of the U.S. want to give truckers more money, they are free to do so, but that is well beyond the topic at hand.
Notably, you ignore their autonomous driving pitch is supposed to increase working quality of like, like many instances of automation (in theory).
What if someone can think drivers deserve better pay and ethical treatment and that self driving is a long term solution to a grueling job?
Why would I acknowledge a flawed premise?
>like many instances of automation (in theory).
That (in theory) is doing so much work here it ought to be paid.
>What if someone can think drivers deserve better pay and ethical treatment and that self driving is a long term solution to a grueling job?
What if mythical beasts like unicorns existed? That would be pretty cool, I guess. Sadly, we'll never know.
In the US, we un-solved this problem decades ago when we abandoned railroads for subsidized auto development.
Only labour gets the special shortage definition seen here. Seemingly because shortage was originally used with respect to healthcare practitioners, where true shortages are possible with price ceilings often imposed by government in order to allow equal healthcare access to all citizens regardless of how much they can afford to spend, and then misconstrued onto other fields.
More or less, but "how much is needed" is dependent on price. You need an infinite number of truck drivers if they are driving for free. And you need no truck drivers if they are driving for $100,000,000,000 per day.
In a functioning market, price will rise until you have exactly the right number of truck drivers. Remember that the dreamers not willing to pay the price are simply not in the market. You don't have a shortage of Ferraris when 10 year old boys with Ferrari posters on their walls can't have the real thing.
However, if something stops the price from rising – such the government stepping in and saying: "It is now illegal to pay truck drivers more than $30,000 per year" – then you have a disconnect. The market wants more drivers and are willing to pay more to get them, but are not allowed to pay them more. That disconnect is what the shortage defines.
There is absolutely no upper limit to driver pay and no nameless bureaucrat filling out some permissible wage table but only "what the market will bear".
From experience I can tell you the main two culprits are it's kind of a shitty job and it's kind of a shitty job that can turn into a really shitty job (or no job) really, really fast.
No serious solutions ever treat it like the quality-of-life problem that it really is -- parking is a major problem, shippers/receivers suck up large quantities of unpaid time and living in a truck/being away from home for weeks at a time is not for everyone are probably the top 3 complaints I would hear. Well, and all the crazy shit the "4-wheelers" get up to but that's usually entertaining.
Right, because there isn't a shortage of drivers. There isn't even a lack of drivers. We have the right number of drivers – along with a whole lot of metaphorical 10 year olds with Ferrari posters who like to talk big with their friends about how they want truck drivers, but when push comes to shove, they really don't.
We can't simply pay more money to get a personal chef, doctor, and pilot for everyone, even if there was a magical infinite source of compensation to pay them.
Remember, money is debt – an IOU, a promise to deliver something later. It says "You do this for me now and I will give you this token (money) that you can redeem for what you want from me in the future.". 'Compensation' is just the other side of the transaction – you offering the same in kind. If there was a magical infinite source of compensation then there would necessarily be an infinite ability to provide chef, medical, etc. services.
In the real world, you only have so much to offer others, which limits how much you can receive from them. As before, transactions must be balanced. That is what it means 'to compensate'. In the real world, you have a pick what you want from the limited amount of value you can offer in kind. There is no such thing as an insatiable demand for chefs or doctors. People will stop considering those services when they become too expensive. The more expensive, the fewer people needed.
This only becomes a problem when price is prevented from rising (e.g. due to government intervention) – and that is when you can encounter a shortage.
Isn't this backwards? This is the colloquial plain-language use of "shortage" (though intentionally misleadingly and wrongly used by employers), you're talking about a technical economics-only definition.
Under colloquial usage, as it is being used here, the term is meaningless. Under that definition, everything is always in "shortage". It is simply used as an attention grabbing mechanism to express some kind of emotion towards the subject.
Surely a transient shortage is possible due to licensing requirements. You could offer ten million dollars a year, but there are only so many people with a current CDL and finite capacity exists to grant new licenses.
You have done well to highlight why a technical shortage is defined the way it is.
In fact, where I live, it is quite illegal for a doctor to accept any amount of payment from a patient. We as a society believe that people, no matter how rich or poor, should have equal access to healthcare, so a doctor giving priority to a billionaire who can offer a handsome reward to get his common cold looked at over someone suffering something much worse is considered abhorrent. As such, we rely on a mixture of first-come, first-serve and needs-based priority instead of a price-based mechanism.
Never heard of any attempts to place similar restrictions on truckers, though. If you want to try and charge a billion dollars per mile, go nuts!
In common use it means that something costs more than many people are willing to pay for it. So your Ferrari example would be a valid use under this meaning.
More likely it costs far less than people are willing to pay for it. When the Colonial Piepline was shut down for ransomware, the shortage occurred because a reasonable populace correctly assessed that the local value of gasoline had just skyrocketed far beyond its steady state price, so the demand became limited only by time and social costs (e.g. you don't want to be the guy whose picture is shown filling trash bags of gasoline) plus ways to store it.
Or it can mean that there's insufficient supply to meet demand at a "reasonable" price.
A commonly used example is milk, yogurt, cream and ice cream. Every year, the farmers produce milk. Some people want yogurt, some want milk, some want cream, &c. Say that one year, everyone wants yogurt for some reason. They are lining up to pay 200%, &c, for it. Then the allocation of resources adapts -- more milk is used to make yogurt. If demand for other products does not go down -- people still want just as much milk, ice cream, &c -- then their prices may go up. Over a reasonable time frame, the effect of this is that more land will be turned over to pasturage and more milk will be produced. Gradually the prices will come down. More people have more yogurt than before; more people are working on that and less on something else (whatever it was). The workers and consumers live happily ever after and resource allocation has adapted to price signals.
One important consideration in the above example is that if people want more yogurt and are willing to pay more, they must also be willing to go without something else. They only have so much money (so much of their own resources to allocate). That is why the resource allocation has to change. Now that might not be milk, per se, but it is probably something adjacent to it, like tofu. We can see how if the shift is from tofu to yogurt, the reallocation of resources might take longer -- people can't just take the milk consumers don't want and turn it into yogurt, they have to get more milk first, which means feeding more soybeans to cows and less to tofu machines -- but it still happens.
A simple example of a shortage is a situation where a virus affects a certain fruit tree, preventing it from growing (or, at least, preventing it from growing the desired fruit). Although people are willing to pay a lot for this fruit, and by extension are willing to consume less of other fruits or other foods, there is no way to turn resources over from the production of other goods to the production of this fruit. It might be that only a small number of areas are isolated enough to produce this fruit; they might all be turned over to it; but after that, there would be no elasticity in the supply of this fruit. Given what we know about the pricing, demand, ordinary cost of inputs for producing the fruit, the supply of this fruit before the virus, we must conclude that there is considerable demand which is not being met.
(Something else notable about the second example is that most of the new, elevated price of the fruit would go into some form of rent. The ground on which the fruit could be produced would be exceedingly rare and valuable, but the material inputs, labor, skill, &c needed for the fruit are the same as before; the new high price would mostly go to the ground rent or financing costs.)
Source? That feels extremely low, maybe even by an order of magnitude.
The recent estimates are closer to 4.4 million software engineers in the U.S. (~2.75% of the working population)
Heh, we are probably more than the secretaries we replaced.
I honestly believe most companies are worse off using computers at all. At some size, you'd probably want some computer system for pay slips. But I am not too sure about that ...
source? I found a better BLS page that grouped all types of software professionals together but it still only came out to about 1.5M
This one seems to have missed the memo, and only gets there briefly once or twice, but the title does not in any way imply an information-free article.
Maybe fewer road incidents, reducing liability? Like, maybe people who can provide for and spend time with their family have 11.3% fewer crashes?
(Edit: number was made up, hypothesis purely speculative.)
The biggest determining factor on a driver is their safety record and if you can manage to not hit anything (you're not aiming for) over a long enough time period it is quite possible to get the good jobs.
[0] https://safer.fmcsa.dot.gov/query.asp?searchtype=ANY&query_t...
The most important things in life are our time, our relationships, our health, our self-determination, basically all subjective and individual experience. Western ethos substitutes those intrinsic values with external "objective" measures rooted in necessity, fear, dogma, etc that evolved over eons of suffering and exploitation under various forms of colonialism where the winners wrote the history.
The ramification of these mismatched attentions/intentions is that we live in a world obsessed with optimizing efficiency, creating a strong work ethic, taking on ever-more responsibility and monopolizing nearly the entirety of our time over a career. Instead of innovating, automating and empowering the workforce to share in the risks and rewards so that someday work is not equated with basic survival.
I believe that the most important thing we can do is disrupt the status quo. In this case, that means thinking outside the box to whatever level is needed to equalize pay between a custodian, a retail clerk, a truck driver and a CEO. The framing of ideas and barriers to entry which prevent that leveling are the root cause of wealth inequality and represent the primary source of injustice in our lives.
If someone happened to win the internet lottery or buy Bitcoin at $10 like I didn't, and is wondering where to invest, stop looking to foreign markets or whatever is over the horizon, and ask what your parents and loved ones sacrificed to get you where you are today. Then ruthlessly work to remove the obstacles they faced for future generations. Anything less is not "real work" IMHO, it's just an ever-growing shrine to your ego.
I moved furniture for 3 years in the early 2000s after getting my computer engineering degree so that I could make rent while writing shareware games, to hopefully win the internet lottery and be able to work on AI someday (which never happened - I'll explain below). It was backbreaking work and I came up with a new invention almost every day that would make the job easier. Some low-hanging fruit would be to require sun awnings over ever door on the trailer and require that truck drivers to carry at least 2 hand trucks (dollies). Beyond that, any number of Roomba-like devices would largely eliminate the human element of packing/loading/driving/unloading/unpacking.
Except that nobody wanted to innovate anything. I came to realize that one of the attachments that people form is to their own suffering. Being a lumper (furniture mover) becomes an identity like coal miner, with its own lingo and culture. We spent most of our days laughing at the clueless yuppies who could never do our job, and the poor rich people who had learned nothing from life because they didn't tip. It's like being in boot camp every day and then being asked to carry water for someone because they don't like to hold things.
Anything else than what we were doing would be an easier gig, if it weren't for the current gig preventing our escape.
---
Anyway, I was lucky to never get seriously injured on that job, but I came away from it forever changed. In many ways the futility of it destroyed my will to work. Not because I was lazy, but because after paying my dues I realized that all labor represents ineficiency. It occurs when the boss isn't creative enough to find the technology that avoids the need for the labor in the first place. Extending that thought to its logical conclusion, money itself represents inefficiency, because if people have the knowledge and resources to support themselves, then they don't need money to pay for things.
This is what I meant above by a win never happening for me. I saw through the matrix too young, which made concepts like investing anethma to me, because I saw that all profit comes from skimming productivity from workers. I independently derived what Karl Marx was saying, before I even knew what socialism really was. And nobody wants to hear about any of that stuff in hypercapitalist USA.
The reality I came from was a patriotic/patriarchial construct where the best we can do is suck it up and work harder tomorrow, but tomorrow never comes. Like the opening scene of Avatar, where the suck (a term borrowed from Jarhead) and unobtainium were more compelling than a tropical paradise. Shows like Yellowstone touch on this - that the hardest workers are paid the least, and that bosses are locked into political games of the status quo beyond their control that they themselves may not even agree with. Wealth inequality triggers our projections, so that the wealthy think they work the hardest, and workers think they are paid well.
Today we're seeing that dissilusionment with the workaday world in all facets of life. Starbucks workers know their jobs could be automated, but then they wouldn't get paid. Uber drivers know that self-driving AI will get them caught in a race to the bottom for pay. Amazon workers know (at least at a subconscious level) that their pay is locked to wages in China. We're all pinned down by our current gigs to the point that they have consumed our imaginations, so that all we seemingly do now is fight amongst ourselves in a zero-sum game.
So, if you've followed this far, the solutions are obvious and apparent:
* Stop equating merit with financial success
* Give labor a 50% seat at the table on every corporate board (like Germany)
* Encourage automation over "hard" (pointless) work
* Prioritize labor-saving innovation over profits
* Stop skimming the profits of labor for building skyscrapers and pork barrel projects
* Legally require that bosses and workers swap roles for at least 2 weeks out of the year (controversial, I know)
* Run doctor's orders by nurses (in all supervisor-assistant relationships in all jobs)
* Prioritize equal pay and do the "real work" of reforming the workplace in every way needed to make that possible
* Have tech companies listen to their engineers again instead of just their designers/partners/investors
* Most importantly - transition to automated robot labor and UBI
I understand that half the people on HN may not identify with what I am saying. They may say that these ideas might hold back the "job creators" propelling innovation forward. But I don't think the two are mutually exclusive. Happier healthier workers are more productive. And wealth inequality is so high that adjusting tax brackets for UBI would cause a reduction in taxes for anyone making under the US GDP per capita of $75,000. Note that the median income is around half that, so most of us are already having half of our productivity or more skimmed via low wages and taxes.
I've tried to write this as objectively/conservative and old school as I could, in the way that one might appeal to labor in the 1950s at a republican convention. Because I think that the left is generally onboard with these measures. The difficulties aren't in principles, but communication.
So is this purely a communication problem, or is there a real a wage/hours problem?
If they're offering enough hours and the employee is choosing to be far under full time, then we should phrase things more specifically than "employed".
But if anyone that wants to be full time, or is full time, doesn't meet the income threshold, that sounds like Walmart taking advantage of insufficient worker protection.
It's silly to put the oneness onto their employers when circumstances can vary so wildly.
Also, paying half as many people twice the wage is in aggregate roughly the same as cutting typical work hours to 20 per week while maintaining the same pay per week. Where's the downside for the employees?
And in particular for the SNAP aspect, the whole point of this discussion is that the current wages were not getting those people out of the SNAP income range, so the taxpayer cost is the same even if Walmart fires all of them and replaces them with nothing.
If Walmart is bad for employing people who rely on SNAP, then wouldn't it be the same be true for any other business that does the same?
> Also, paying half as many people twice the wage is in aggregate roughly the same as cutting typical work hours to 20 per week while maintaining the same pay per week.
My point is that it's not roughly the same at all. In one option everyone is still employed, and in the other half the people don't have a job. Obviously, if something magically doubles everyone's productivity, that would be a good thing, but you have to apply that on both sides of the comparison.
> taxpayer cost is the same even if Walmart fires all of them and replaces them with nothing.
Walmart minimum wage is $14 now. Walmart workers who are single and childless or married to a working couple who otherwise wouldn't be eligible for SNAP would become eligible if they lose their jobs.
I didn't say they're bad. My claim is that if they paid twice as much per hour, for half as many people, that would be an improvement.
> My point is that it's not roughly the same at all. In one option everyone is still employed, and in the other half the people don't have a job. Obviously, if something magically doubles everyone's productivity, that would be a good thing, but you have to apply that on both sides of the comparison.
If people can get paid the same amount while working half as many days, most of them will work fewer days. Half of people would not be unemployed. And for the people that would end up unemployed, more jobs will fill the void.
We don't need to push down wages to keep people employed.
There would be a lot of chaos if every single company doubled wages to low level employees on the same day. But we don't need to worry about that contrived scenario.
> Walmart minimum wage is $14 now. Walmart workers who are single and childless or married to a working couple who otherwise wouldn't be eligible for SNAP would become eligible if they lose their jobs.
I think the vast majority of them would find new jobs.
Or we could only apply this policy to future Walmart hires or something.
I gave a simple thought experiment, but you're trying to escape making a trade off. Yes, in the real world, people value free time, you can employee people part time, and there are other employers besides Walmart, but that's outside the point I'm trying to make. If we're going for full realism, Walmart would also go bankrupt if they laid off half their workforce and paid the rest twice as much.
If we keep things as simple as possible, and assume those people stay unemployed, then Walmart should make as many jobs as possible at absolute minimum wages, maybe even below the legal limit. But if we're talking about semi-realistic scenarios, then they should not do that.
This moral framework can lead to all sorts of suboptimal outcomes, such as employer healthcare mandates that are subsided with tax incentives (though some other interventions, like modest minimum wages can help people without distorting the economy).
According to this logic, if I'm $300,000 in college debt, it's my employers fault if I can't make ends meet (even if I'm getting paid well).
Walmart could pay shelf-stockers $50/hr, but if they have 6 kids and work 20 hours a week, they would actually qualify for food stamps. Does that mean they're underpaid at $50/hr?
I'm very clearly illustrating a point, not making a factual claim that Walmart pays stockers $50/hr
Also, Wallmart have plenty of non full-time jobs, which tend to attract a lot of single mons that have no access to child-care, and this probably increases the probability of those employees being eligible to SNAP.
The media loves to drop those kind of number without context for page-views.