According to the American Trucking Associations, the trucking industry is currently short around 48,000 drivers with that number expected to surge to 890,000 by 2025. 1This increase will be gradual, however, there will be a noticeable tightening by mid-year 2017, FTR Associates predicts.
The actual extent of the driver shortage is still unknown with a lot of it having to do with upcoming regulations and whether the Trump administration will help deregulate the industry as many are hoping. As it currently stands, mandatory electronic logging devices, which go into effect Dec. 10, 2017, along with hours-of-service requirements, are expected to add to the shortage. Retiring drivers and the increasing cost of equipment (especially for owner-operators) will further pull drivers out of the pool.
Stephens’ transportation analyst Jack Atkins notes that the capacity restraint will give carriers and brokers a favorable year as the spot market demand will increase and with it, rates. Atkins foresees “contractual rate increases in the 2017 bid season as a result of the mandate and the potential for driver wage inflation.” 2
According to industry experts, driver pay is anticipated to increase 5% in the first quarter while contract rates are expected to go up this year “in the low single digits.” 3Shippers know that higher rates are on the horizon and many are locking in low contract rates before the spike.
While we won’t see a surge in driver shortage all at once, capacity crunches are already being seen. The last week of December witnessed higher load-to-truck ratios with availability on load boards dropping 17% and capacity outpacing it, falling 29%. 4
The driver shortage has also impacted the number of trucks being purchased with truck orders declining 30% last year and expected to fall 12% this year. 2
Road Scholar Transport can help move your freight when capacity is tight offering the following services:
*Trailer and Storage Unit Rental
Visit www.roadscholar.com to get a rate today or to chat with a live representative.