FAIR WARNING: This is a long post. If you are not interested in rather extensive facts, figures, and perspectives, you may want to skip this one.
Not much for math, I know just about enough to be a danger to myself...........not a big numbers guy either, usually just use them to validate what my gut feelings are.....that is what I am fixing to do........
Current top scale at my center is 23.68, which IIRC from some of your earlier posts would mean we are on the same scale. Funny how no one could remember what top scale was then though. Of course, it is much easier to remember what ones starting rate was (my first position at Arkansas Freightways paid 7.50/hr, but I couldnt tell you what I made 5 years ago). Did find a guy that started in 2010 though and he remembered his starting rate.......
2015 (current) driver starting hourly rate: 20.68
Driver starting hourly rate, circa 2010 : 18.59
2.09 increase/18.59= 11.2% wage increase over the past 5 years.........pretty much right in the middle of my estimate.......
Furthermore, 2.09 x 2080 hours would equate to 4347.20 increase in yearly earnings. While I certainly understand that some folks may have seen their health insurance out of pocket increase more than 4347.20 per year, I would still contend that most did not, I know for a fact that mine didnt. This doesnt even take into account that both the 401k and PPA contributions increased by 11.2% as well because of the higher wage.
AF, I'll concede to an extent, that your 10% figure over 5 yrs. was not too far off. Based on an average 2%x5 =10% (actually 10.4%). I can't currently disprove the average rate of increase.
I do recall since the FedEx take over, raises always lagged slightly behind inflation (at my location and yours). Again, since I can't prove it (at this time), you can either take my word for it (until I obtain proof), or chalk it up to swampratt babble. I'm good either way. One day I'll come across an old check stub (or two) to provide historical reference.
Even based on our (low) pay scale, our most recent increase of 80 cents (3.5%) was for 17 months (1.413 years), due to the delayed increase. That equates to 2.47% on an annual basis. That increase does inflate the 5 year average, especially as it relates to inflation, as 2014 showed the lowest inflation of the 5 years (.8%)
Also, I'm not certain, but they may have increased starting driver wages, to be more competitive in the difficult recruiting market. That would skew the numbers just a bit, while costing very little. That same 80 cent raise, based on (their prior) 19.88, equates to a 4.02% increase. 2.85% on an annual basis. Talk about skewing the average!
Inflation/COL
http://www.bls.gov/cpi/cpi_dr.htm
5 year 2009-2014 8.8 (average per year 1.76)
10year 2005-2014 21.6 (average per year 2.1)
In the AF days, I seem to recall, annual raises ALWAYS exceeded inflation, even if by just a bit. That is how they became among the highest paid non-union carriers.
Watkins must have had similar formulas due to the fact that many watkins guys actually took a bit of a pay cut to remain with (be hired by) FedEx.
Insurance: I'll also agree that most never meet, let alone, exceed their deductible. Again, I think the VALUE of the plan should be the plan, regardless of whether or not one uses it. Example: Life insurance has considerable value, even though very few will use it in a given year. The benefit has a specific value, and is a part of our compensation package. Reduce or eliminate it, and you reduce the value of the compensation package to all. Not just few those who use it.
I and the numbers disagree with this premise as well.........
The way I look at it, FedEx Freight has 3 groups that it has to provide value to: Customers, Employees and the Corporation. Obviously, I used some comparisons for value provided to employees above. Lets look at FXF Operating Income (profit) numbers to see what the value provided to the corporation was..............I put the "line in the sand" in 2009, when the economic crunch began in full force, going to compare the 6 years before the downturn and the 6 years after.....these numbers are millions, off of the earnings reports........
2003-2008 2009-2014
FY03 - 193 FY09 - -44
FY04 - 244 FY10 - -153
FY05 - 354 FY11 - -175
FY06 - 485 FY12 - 162
FY07 - 463 FY13 - 251
FY08 - 329 FY14 - 319
6 yr avg - 345 millon 6 yr average - 60 million
Basically a 82.6% decrease in value provided to the corporation.............regardless of what value loss might have been put on us employees, it pales in comparison to the value loss the corporation endured in these timeframes.
If you really look at the numbers, it does show reason for optimism and helps explain the much larger increase this year. FY12 and FY13 pretty much filled up the hole created in the previous 3 years. FY14 basically was back within shouting distance of the performances that were commonplace in the pre-2009 era. The even better news is that through 2 quarters of FY15, we are sitting at 280 million in Operating Income, which barring exceptionally poor performances in these final 2 quarters would put us in the 400 million-ish range and open up a lot of possibilities for that high water to cover up some stumps........
Got a headache now after looking up all those numbers........
Carry on sir........
Fair observation, BUT I feel compelled to add:
While I understand the argument you make regarding the ratio between profit and wages, that is not really the point. Did our wages soar during the '03-'08 period, to coincide with soaring profits? NO. Gross Revenue is, therefore, a more accurate gauge as to the VALUE we provide.
Just because the Company chooses to lower their margin (much like how Walmart succeeds), is it reasonable for the Company to also lower employees' profit margin? We haul a lot more freight, a lot more efficiently. That equates to a lot more work done. At a lower margin for us, the employees. We can't help it if profit didn't coincide with revenue. Our job is to provide the service that brings revenue, while doing so efficiently, and safely. That service demands market value. Preferably at the higher end of the range of acceptable, based on our excellence in providing that service.
Let's look closely at the REVENUES (in Millions), and the trends.
2003/$2120 (that is 2.12 Billion)
2004/$2689
2005/$3217
2006/$3645
2007/$4586
2008$4934
2009/$4415*(1)
2010/$4321*(1)
2011/$4911*
2012/$5282
2013/$5401
2014/$5757 (that is 5.757 Billion)
* the only 3 years with a negative operating ratio (loss).
*(1)Only in the 2 years noted, did revenues fall year over year.
Note that the only negative OR years were related to recession, cost associated with the Watkins acquisition, and the negative impact of the 90/90 program (90% disc. for 90 days) during YRC's darkest days.
2011 was the last year they showed any residual costs associated with Watkins.
Source for all of the above? FedEx own annual reports, all of which can be found here:
http://investors.fedex.com/financial-information/annual-reports/
Supply and demand, as well as the Union movement, seem to be the only driving factors effecting our compensation package. Profits and/or gross revenue have had absolutely no impact, IMHO. Government regulation and the appearance thereof, provided an opportunity to reduce costs and VALUE of our benefit package.
The driver shortage has caused other carrier to raise wages in excess of FedEx freight. Significantly higher in some areas. Just a bit higher in others. FedEx seems to be following that trend (rather than leading it), though MUCH more slowly than others. Is this by design? Is this an effort to eek out every possible advantage, by being behind the competition (even by one year)? On that we can only speculate.
Back to your regularly scheduled programming...