Dive Brief:
- After adding thousands of workers to respond to skyrocketing demand, Old Dominion Freight Line will now slow hiring as softening LTL volumes has left the company overstaffed, President and CEO Greg Gantt said during a Q2 earnings call.
- The carrier, reluctant to lay off workers in a difficult labor market, will rely on attrition to match its labor levels to declining demand, Gantt said.
- Old Dominion plans to use the lull in hiring to refine its training processes. “It’s not all bad,” Gantt said. “You end up with better-trained employees.”
Dive Insight:
The Thomasville, North Carolina-based carrier has been on the same hiring spree as many in the trucking industry in the past few years, and staffing levels boomed amid a crush of freight demand during the pandemic.
Old Dominion’s headcount reached 24,893 last quarter, up more than 6,000 employees since Q3 2020 and more than 3,000 in the past year alone, according to a company spokesperson. But that recruitment campaign is largely over, and the carrier is now focused on retaining its employee base, rather than growing it further.
“We're not actively hiring hardly anywhere now, maybe specific needs and replacements and that kind of thing, but we're certainly not adding anybody on top of what we've got,” Gantt said.
Asked by one analyst whether challenges in hiring and retaining drivers over the past few years would make the company think twice about any potential staffing reductions, Gantt replied: “No question.”
“We certainly don't want to get in a situation where we have to start making cuts,” Gantt said. “That's extremely hard to do. We always hate to do that.”
The carrier will shift resources to improving employee productivity in linehaul, load factor and other parts of its business.
“Again, nobody wants to see it slow down,” Gantt said. “But certainly, we look at the positive aspect of it and, you know, what we can accomplish."
While Old Dominion has tapped the brakes on hiring, employee retention efforts continue. The company plans to give annual raises in September, CFO Adam Satterfield said during the call.
