It’s costing more and more for shippers to get their cargo where they need it to go. The capacity crunch is giving carriers record profits, and Q2 earnings for 2018 showed huge gains for most publicly traded trucking companies. Even brokers and freight factoring companies are seeing a huge spike in revenue. So why aren’t truckers seeing their earnings increase as much?
As the freight market becomes tighter, trucking companies are able to jack up the price to move goods. With the capacity crunch as bad as it is, shippers have no choice but to pay higher rates.
According to Bloomberg, in the past 12 months, the cost of shipping goods via long-haul trucks has increased by 11.6%. During that same 12-month period, the average hourly earnings for an OTR driver rose just 0.5%.
Since both freight factoring companies and brokers tend to bill based off of percentages instead of fixed amounts, their pay goes up whenever carriers make more money. But a trucker’s pay isn’t tied directly to their carrier’s profits.
The good news for truckers is that companies have been ordering record-setting numbers of trucks and trailers. Ordering more equipment means that carriers will need even more drivers, pushing up demand. That could lead to carriers competing more fiercely for drivers by offering better pay.