This chapter consists of the background of study, problem statement, research questions, research objectives, hypotheses and significance of study.
Background of study
High truck driver turnover rate and shortage of truck driver is a critical issue in logistics industry, especially for those companies that primarily focus on providing trucking services to transport cargo over short and medium distance. This is because high turnover rate tends to bring significant effect to the industry. When company is hiring new truck drivers, they need to spend time on recruiting truck drivers. Besides this, they also need to spend time on interviewing the driver in order to choose the most suitable and potential one. After that, they need time to train the drivers. Due to the high turnover rate, it caused trucking companies difficult to operate efficiently, maximize the utilization of the tractors and trailers to meet the customers’ requirement because truck drivers in a particular trucking company are changing from time to time and shortage of driver may also occur in the company which can cause the company underutilize the capacity available (Cassidy, 2013).
Impact such as high hiring cost can affect greatly on the company’s profitability. This is because the human resource department needs to cooperate with the external recruiters to recruit new truck drivers, thus they need to pay compensation to the recruiters. Besides this, company may also use advertisement to recruit new drivers, thus they need to pay for the cost of placing advertisement on newspaper, advertisement board and etc. When new truck drivers are hired, company needs to provide trainings to them in order to make sure that they perform the task according to all practices that set by the company.
Besides this, lower productivity due to new routes, new customers’ requirements, new company policies and etc can also cost the company as high as possible once these drivers have started their work in the new company (White, 2011). According to the American Trucking Association (ATA) report issued in December 2013, truck driver turnover cost a company five thousand dollars per driver (Clark, 2014).(责任编辑：BUG)