More work, less pay

More work, less pay

Transportation professionals who are looking to advance their careers in the ocean shipping, air cargo, freight forwarding and distribution industries are in for some good news. Companies are hiring.

But job candidates be warned: Salaries in transportation are virtually unchanged from last year even though employers are demanding higher educational achievement and enhanced skills.

"It's still a seller's market," said William P. Conroy, president of Tyler Search Consultants in Ramsey, N.J. Conroy and Deborah Shey Harding, a principal in Shey-Harding Associates in Seal Beach, Calif., researched the second-annual survey of freight-transportation salaries for The Journal of Commerce.

Transportation professionals who are moving to other companies are generally achieving salary increases of 12 percent to 17 percent. "They're not getting the 30 percent bumps in salary. That goes for relocations as well," Conroy said.

This is making it harder for executive recruiters to convince talented candidates to leave low-cost areas and move to regions such as New York-New Jersey and Southern California, where housing prices have skyrocketed over the past two years.

"Salaries are not keeping up with the cost of living," Shey-Harding said. Those carriers that are paying top dollar to attract talent are getting the cream of the crop, she said.

If a company in a high-cost area is serious about landing a qualified candidate, it may offer a onetime enhancement such as a signing bonus. Those bonuses can be as high as $25,000, Conroy said.

However, transportation professionals who work in high-cost areas are refusing to move to low-cost areas unless the salary and benefits are commensurate with the title and responsibility of the job. Companies that attempt to attract candidates based solely on a lower cost of living in their region will not succeed in getting the best talent available, Conroy said.

Ocean carriers that endured a lengthy period of downsizing earlier in the decade are searching for new talent, on the sales side as well as in operations. Cargo volumes are strong, especially in the Asian trades, the companies are ordering larger ships that have to be filled and they are expanding their marine terminals.

As a result, Shey-Harding Associates has booked more business in the first half of this year than it did all of last year. Carriers are hiring at all levels, including chief executives, chief operating officers and chief financial officers, Shey-Harding said.

The operations side of the business is especially active, with terminals looking for managers with hands-on operations and stevedoring experience. The terminals in recent years have not devoted much attention to grooming top operations people, so there is a shortage of experienced executives in those areas, she said.

Importers and exporters are back-filling transportation and logistics positions that were left languishing in recent years. The caveat is that they are often changing the titles of the jobs and are demanding greater performance, Conroy said. The positions are increasingly being filled with candidates that have college degrees in transportation and logistics.

Companies, especially the larger importers and exporters, are being very specific as to the skill sets and experience levels they are looking for. "They want a bull's-eye. Candidates are expected to hit the deck running," Conroy said.

Companies are usually willing to relocate talented candidates, especially if the firms are located away from the big cities where the local talent pool does not provide enough options. The companies are conserving their resources, however, and are attempting to whittle down their choices to the top two or three prospects before flying the candidates in for personal interviews.

When a candidate does make the cut, the personal interview can be a grueling, daylong experience in which company executives ask detailed questions. At the end of the process the candidate is expected to make a presentation. "It's American Idol and The Apprentice rolled into one," Conroy said, comparing the interview process to the popular television reality shows in which candidates competed for recording positions and a management job in Donald Trump's organization.

Third-party companies involved in warehousing, distribution and logistics are also hiring at a brisk pace. The Inland Empire east of Los Angeles, the Exit 8A area off the New Jersey Turnpike and the Southeast are full of mid-level job opportunities in warehousing and logistics as retailers continue to expand their distribution centers close to major seaports.

Those jobs are considered attractive because they pay good salaries and the distribution hubs are located outside of the high-cost port cities.

Security positions are also readily available in the post-Sept. 11 environment, but companies are still attempting to determine what the requirements of the job should be and how much the positions should pay. "The days of the rent-a-guard are over," Shey-Harding said.

However, this is such a new area for most carriers that security positions do not yet pay salaries that are needed to attract the best talent, she said.

Generally in transportation, salary levels for mid-level and higher management positions are lagging behind other industries. "I haven't seen a substantial increase in salaries. They're not really making it enticing," Conroy said.

Candidates who are looking to switch jobs will get the most money if they focus on companies that are profitable and are known to go after the best talent available. Since those companies tend to be the larger ones, candidates should have specialized skills that precisely fit the requirements of the Fortune 500 companies. "There are no utility players out there any more," Conroy said.

Even then, the jobs will probably offer an increase of less than 20 percent above the salary the candidate is now earning, Conroy said. Most companies today do not want to risk upsetting the established salary range at their organizations by hiring an outsider at a wage that is significantly higher than the wages being paid to other employees in a department, Conroy said.

Nor do companies in transportation wish to replace highly paid veterans who retire or leave their organizations with young managers who expect to start where the former executives left off. Many of the companies are filling those positions with younger managers who will start at a salary that is 30 percent less than what the veteran manager was paid, Shey-Harding said.

However, onetime incentives such as a hiring bonus are becoming more common in transportation, as are annual bonuses tied to an individual employee's performance or the economic performance of the company, she said. Also, air freight companies often pay a salary plus a commission, with the commissions potentially being equal to the base salary when cargo volumes are strong.

Salary levels in transportation will increase if the demand for talent grows faster than the available pool of candidates, but for now companies are demanding performance. "We continue to see incentivized compensation packages - with bonuses tied to deliverables," Conroy said.

Behind the research

SHEY-HARDING ASSOCIATES in Seal Beach, Calif., is an executive recruiting firm that serves air, sea and rail carriers. The company also recruits applicants for logistics providers and technology firms in the transportation industry. The company was founded in 1990. Deborah Shey-Harding, a principal in the company, has a master's degree in human resource management and organization development from the University of San Francisco. Shey-Harding also taught labor relations and organization behavior at the university level.

TYLER SEARCH CONSULTANTS in Ramsey, N.J., is an executive recruiting firm for logistics, supply-chain management and transportation industries. Tyler has offices in New York, Boston, Birmingham, Ala., Atlanta; Albanly, N.Y.; and Miami. William Conroy, president of Tyler Search Consultants.