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FTR trucking index hit all-time high in February; more gains seen
Index breaks 26-year record; more gains seen through second quarter.
A monthly index of trucking conditions published since 1992 by consultancy FTR hit an all-time high in February, adding further evidence to what some believe is a one-for-the-ages economic scenario for the industry.
The February reading of 15.41 was a 4-point jump over January's levels, which were already very strong. To put February's numbers in context, a zero reading indicates that truck supply and demand are roughly in balance. Positive readings mean strong conditions for carriers and, conversely, a tough market for shippers. FTR also publishes a monthly index that tracks conditions for shippers.
FTR said the current conditions are likely to last at least through the second quarter, which is seasonally a strong period for trucking as warmer weather leads to more construction activity and, by extension, shipping. The first-quarter figures are remarkable in that the period is historically soft for freight demand.
Noel Perry, an economist who has been around trucking since 1976, said last week at the Transportation Intermediaries Association's (TIA) annual conference in Palm Desert, Calif. that the environment is the strongest he's seen in the past 50 years.
"For carriers, there is a feeling of 'Let the Good Times Roll,' and the data is backing that up," FTR COO Jonathan Starks said in a statement. Starks expects the growth surge to moderate in the second half of the year as freight demand decelerates and more equipment hits the market. Perry, for his part, expects cloudier skies more in 2019 and into 2020 as an economic recession becomes more likely and freight demand slows considerably.
The index tracks changes in the five major conditions in the U.S. truck market: Volumes, rates, fleet capacity, fuel price, and financing. The individual metrics are combined into a single index that tracks the market conditions that influence fleet behavior.
http://www.dcvelocity.com/articles/...it-all-time-high-in-february-more-gains-seen/
Index breaks 26-year record; more gains seen through second quarter.
A monthly index of trucking conditions published since 1992 by consultancy FTR hit an all-time high in February, adding further evidence to what some believe is a one-for-the-ages economic scenario for the industry.
The February reading of 15.41 was a 4-point jump over January's levels, which were already very strong. To put February's numbers in context, a zero reading indicates that truck supply and demand are roughly in balance. Positive readings mean strong conditions for carriers and, conversely, a tough market for shippers. FTR also publishes a monthly index that tracks conditions for shippers.
FTR said the current conditions are likely to last at least through the second quarter, which is seasonally a strong period for trucking as warmer weather leads to more construction activity and, by extension, shipping. The first-quarter figures are remarkable in that the period is historically soft for freight demand.
Noel Perry, an economist who has been around trucking since 1976, said last week at the Transportation Intermediaries Association's (TIA) annual conference in Palm Desert, Calif. that the environment is the strongest he's seen in the past 50 years.
"For carriers, there is a feeling of 'Let the Good Times Roll,' and the data is backing that up," FTR COO Jonathan Starks said in a statement. Starks expects the growth surge to moderate in the second half of the year as freight demand decelerates and more equipment hits the market. Perry, for his part, expects cloudier skies more in 2019 and into 2020 as an economic recession becomes more likely and freight demand slows considerably.
The index tracks changes in the five major conditions in the U.S. truck market: Volumes, rates, fleet capacity, fuel price, and financing. The individual metrics are combined into a single index that tracks the market conditions that influence fleet behavior.
http://www.dcvelocity.com/articles/...it-all-time-high-in-february-more-gains-seen/
Driver pay jumps 15% in five years, but persistent shortages dog carriers
There has never been a more profitable time to be a truck driver—or a tougher time to be trying to hire one. By most accounts, the industry is about 50,000 qualified drivers short of what demand could handle.
'Finding qualified drivers is one of the top areas of focus,” Darren Hawkins, who assumed the role of president and COO of YRC Worldwide on Jan. 1, told LM.
For more than a decade, unionized carriers such as YRC and ABF Freight had a surplus of drivers, often several hundred or more on layoff status because of the soft economy of the past.
That is no longer the case as less-than-truckload (LTL) carriers are joining their truckload brethren in the search for qualified, compliant drivers to replace those retiring or leaving the industry.
'We have a more attractive lifestyle than truckload drivers,” Hawkins explained. 'Once we find a qualified driver, we can retain them. But finding the qualified driver is taking work on LTL side.”
Hawkins said LTL carriers “all have recruiting departments, driving schools, and we try to transition dock workers into drivers.” But he said the shortage of human power is preventing nearly all trucking companies from expanding capacity.
So when shippers read headlines saying 'March Class 8 orders vault past 40,000 for third straight month,” they should remember this does not mean 120,000 additional trucks in added capacity. Rather, executives and analysts agree, those orders are for replacement trucks only.
'I believe it’s going to keep a lid on capacity in LTL sector as well,” Hawkins said. 'There is only so much capacity available. Our job is to make that capacity as productive as we can.”
A recent American Trucking Associations survey of more than 100,000 drivers shows driver pay has climbed as rising demand for freight transportation services has increased competition for increasingly scarce drivers.
This latest survey shows fleets reacting to an increasingly tight market for drivers by boosting pay, improving benefit packages and offering other enticements to recruit and retain safe and experienced drivers, according to ATA Chief Economist Bob Costello.
According to this most recent study, the median salary for a truckload driver working a national, irregular route was over $53,000 – a $7,000 increase from ATA’s last survey, which covered annual pay for 2013, or an increase of 15%. A private fleet driver saw their pay rise to more than $86,000 from $73,000 or a gain of nearly 18%.
But in 1980 the average driver salary was $38,618 annually in 1980. If that had been adjusted for inflation, that salary today would be over $111,000 a year, according to Todd Spencer, president of the Owner-Operator Independent Drivers Association (OOIDA).
In a sign of desperation, the trucking lobby has revived an oft-killed proposal to allow 18-to-21-year-olds to drive an 80,000-pound rig across state lines. Proponents say the younger drivers could help ease the shortage. But in an election year, safety advocates and the railroad lobby can be counted on to oppose this measure in spades.
So for at least now, fleets are resigned to just paying more. In addition to rising pay, Costello said fleets were offering generous signing bonuses – as much as $10,000 if they stay one year with a company--and benefit packages to attract and keep drivers.
'Our survey told us that carriers are offering thousands of dollars in bonuses to attract new drivers,” Costello said. 'And once drivers are in the door, fleets are offering benefits like paid leave, health insurance and 401(k) s to keep them.
'This data demonstrates that fleets are reacting to concerns about the driver shortage by raising pay and working to make the job more attractive,” he said. 'I expect that trend to continue as demand for trucking services increases as our economy grows.”
Still, there seems to be pent-up anger among some of the nation’s 3.5 million long-haul truck drivers, who often cite a lack of respect as one of the top reasons for quitting the job.
Robert Martinez, the new administrator of the Federal Motor Carrier Safety Administration, reportedly got an earful when in the first weeks on the job he decided to hold a 'listening session” at the Mid-American Truck Show attended by thousands of drivers recently.
'There is no one at FMCSA that has been a truck driver. It’s amazing to me how many experts there are in trucking that have never set their butt in a truck,” one truck driver quoted at the Mid-American Truck Show (MATS) in Louisville, Ky., recently said. 'But you won’t listen to us. We are the experts.”
https://www.logisticsmgmt.com/articl...s_dog_carriers
There has never been a more profitable time to be a truck driver—or a tougher time to be trying to hire one. By most accounts, the industry is about 50,000 qualified drivers short of what demand could handle.
'Finding qualified drivers is one of the top areas of focus,” Darren Hawkins, who assumed the role of president and COO of YRC Worldwide on Jan. 1, told LM.
For more than a decade, unionized carriers such as YRC and ABF Freight had a surplus of drivers, often several hundred or more on layoff status because of the soft economy of the past.
That is no longer the case as less-than-truckload (LTL) carriers are joining their truckload brethren in the search for qualified, compliant drivers to replace those retiring or leaving the industry.
'We have a more attractive lifestyle than truckload drivers,” Hawkins explained. 'Once we find a qualified driver, we can retain them. But finding the qualified driver is taking work on LTL side.”
Hawkins said LTL carriers “all have recruiting departments, driving schools, and we try to transition dock workers into drivers.” But he said the shortage of human power is preventing nearly all trucking companies from expanding capacity.
So when shippers read headlines saying 'March Class 8 orders vault past 40,000 for third straight month,” they should remember this does not mean 120,000 additional trucks in added capacity. Rather, executives and analysts agree, those orders are for replacement trucks only.
'I believe it’s going to keep a lid on capacity in LTL sector as well,” Hawkins said. 'There is only so much capacity available. Our job is to make that capacity as productive as we can.”
A recent American Trucking Associations survey of more than 100,000 drivers shows driver pay has climbed as rising demand for freight transportation services has increased competition for increasingly scarce drivers.
This latest survey shows fleets reacting to an increasingly tight market for drivers by boosting pay, improving benefit packages and offering other enticements to recruit and retain safe and experienced drivers, according to ATA Chief Economist Bob Costello.
According to this most recent study, the median salary for a truckload driver working a national, irregular route was over $53,000 – a $7,000 increase from ATA’s last survey, which covered annual pay for 2013, or an increase of 15%. A private fleet driver saw their pay rise to more than $86,000 from $73,000 or a gain of nearly 18%.
But in 1980 the average driver salary was $38,618 annually in 1980. If that had been adjusted for inflation, that salary today would be over $111,000 a year, according to Todd Spencer, president of the Owner-Operator Independent Drivers Association (OOIDA).
In a sign of desperation, the trucking lobby has revived an oft-killed proposal to allow 18-to-21-year-olds to drive an 80,000-pound rig across state lines. Proponents say the younger drivers could help ease the shortage. But in an election year, safety advocates and the railroad lobby can be counted on to oppose this measure in spades.
So for at least now, fleets are resigned to just paying more. In addition to rising pay, Costello said fleets were offering generous signing bonuses – as much as $10,000 if they stay one year with a company--and benefit packages to attract and keep drivers.
'Our survey told us that carriers are offering thousands of dollars in bonuses to attract new drivers,” Costello said. 'And once drivers are in the door, fleets are offering benefits like paid leave, health insurance and 401(k) s to keep them.
'This data demonstrates that fleets are reacting to concerns about the driver shortage by raising pay and working to make the job more attractive,” he said. 'I expect that trend to continue as demand for trucking services increases as our economy grows.”
Still, there seems to be pent-up anger among some of the nation’s 3.5 million long-haul truck drivers, who often cite a lack of respect as one of the top reasons for quitting the job.
Robert Martinez, the new administrator of the Federal Motor Carrier Safety Administration, reportedly got an earful when in the first weeks on the job he decided to hold a 'listening session” at the Mid-American Truck Show attended by thousands of drivers recently.
'There is no one at FMCSA that has been a truck driver. It’s amazing to me how many experts there are in trucking that have never set their butt in a truck,” one truck driver quoted at the Mid-American Truck Show (MATS) in Louisville, Ky., recently said. 'But you won’t listen to us. We are the experts.”
https://www.logisticsmgmt.com/articl...s_dog_carriers