The American Trucking Association (ATA) released the findings of its 2022 ATA Driver Compensation Study on Wednesday (Aug. 10), in which more than 135,000 drivers and nearly 20,000 independent contractors were asked about their compensation, including pay rates, bonuses, and benefits. According to the survey, which was completed in early 2022, nearly 60% of respondents said they would raise driver pay this year.
“The data confirms what industry sources have been saying for some time — the driver shortage has been great for drivers who saw their wages rise last year,” ATA Chief Economist Bob Costello said. “Pay increases were broad-based across the industry; for example, the average truckload driver saw a wage increase of 10.9% last year between salary increases and bonuses.”
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During a conference call on Wednesday, Costello stated that the nearly $70,000 compensation package includes bonuses but not benefits, which he described as satisfactory. He also stated that approximately 80% of for-hire truckload drivers are paid by the mile, with the remaining 20% paid on an hourly or salary basis.
According to Costello, driver turnover in the industry ranges between 70% and 75%, with the majority of this attributed to churn, or when a driver switches from one carrier to another. Sign-on bonuses also play a role in this. Bonuses range between $1,500 and $5,000. Some have reached as much as $10,000.
“If you’re a driver with a good driving record and can pass a drug test, you can change jobs for any reason,” he said. “It’s 11:39 a.m. here.” Drivers could find work in a matter of hours. They are in such high demand.
“They can change jobs if they go to a company and don’t like the routes or…for whatever reason, they don’t like the way a dispatcher talks to them or something.”
Costello also mentioned that final mile drivers for truckload companies make around $65,000 per year. However, these jobs are more labor intensive because final mile drivers are more likely to handle freight, whereas most long-haul drivers do not.
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The ATA released the previous Driver Compensation Study in May 2020, which revealed that driver pay increased by nearly $6,000 to around $58,000 in 2019 compared to 2017. The ATA announced in October 2021 that the driver shortage had reached a new high of 80,000, up from 61,000 in 2018.
As of May 2021, the median pay for heavy and tractor-trailer truck drivers was $48,310, according to the U.S. Bureau of Labor Statistics. In Arkansas, truck drivers earn an average of $49,090 per year. Arkansas has the highest job concentration and location quotient in the field, with more than 27 drivers per 1,000 jobs and a location quotient of 2.02. A location quotient greater than one indicates that the occupation employs more people than the national average.
Walmart, based in Bentonville, Arkansas, announced in April 2022 that its drivers could earn up to $110,000 in their first year. According to the American Trucking Association’s new survey, the median salary for a private fleet driver in 2021 will be $85,000.
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According to the National Transportation Institute, nearly 20,000 long-haul truck driving jobs will be added to the US workforce by May 2022. Long-haul jobs have increased by 4.3% since the spring 2020 downturn.
Other highlights from the ATA’s new survey include:
In 2021, more than 90% of truckload fleets increased pay, with an average increase of 10.9%. Furthermore, 96% of fleets provided referral bonuses for new drivers, while 54% provided sign-on bonuses.
In 2021, all less-than-truckload drivers’ pay increased, with the median wage reaching $73,000.
Non-drayage owner-operators are expected to earn a median gross revenue of $235,000 in 2021. While drayage owners are expected to earn a median gross revenue of $164,000.
“Driver salaries were really driven by the driver shortage. Combined with increased demand for goods in the post-pandemic economy,” Costello said. “These raises should dispel myths about the nature of this job. Trucking is a path that can provide a well-paid career for Americans seeking more.”
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The Freight Transportation Services Index reached a new high in June, according to the US Department of Transportation. The index is based on the amount of freight carried by for-hire transportation companies. Increased by 1.7% in June compared to May. The index was also up 4.6% since June 2021. The increase can be attributed to increased trucking, rail carloads, air freight, and water transportation. Rail intermodal and pipeline transportation declined.
WHY ARE AWARDS GETTING BETTER?
Corporate distrust is an increase in litigation funding (in which third parties finance litigation or other legal costs in exchange for a share of the lawsuit’s proceeds). Moreover, a general sense of social pessimism all contributes to the increasing severity of jury awards.
According to Advisen Front Page News. Recent trucking accidents resulted in significant awards totaling $11.8 million, $38.8 million, $43.5 million, and $1 billion.
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STEEP AWARDS AND TRUCKING EMPLOYEES
Such large losses have a direct impact on insurance pricing. Excess trucking liability has been particularly impacted as large auto losses threaten the trucking industry’s profitability. Increased rates, decreased capacity, and, in some cases, multiple insurers involved at low levels of excess layers reflect the shift.
The rising cost of insurance can make it difficult for trucking companies to properly insure their fleets. To save money, many trucking companies are reducing their excess insurance coverage. Putting them at greater risk of bankruptcy if an incident occurs.
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Over the last four years, the percentage of trucking awards exceeding $10 million has increased by 15%. Plus these large losses account for 35% of trucking losses over $1 million from 2017 to 2021. According to Advisen loss data, this is a significant increase from the previous eight years. When trucking awards over $10 million accounted for 20% of losses over $1 million.
Over $100 million awards have increased in frequency in recent years. However, they still account for a relatively small percentage of total trucking losses.
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