5 ms·

The supply side dynamics of trucking is crazy. There has been a driver shortage for 10+ years, easy. About 2/3 of the trucks on the road are owned by fleets of

The supply side dynamics of trucking is crazy. There has been a driver shortage for 10+ years, easy. About 2/3 of the trucks on the road are owned by fleets of 5 or less, with most trucks being a 1 unit, owner operator. The entire industry, small and large fleets, use owner operators as perverse cost savings. In some cases, you lease the truck from the large fleet, they charge you for gas and maintenance, insurance, etc; deducted straight from your check. You integrate with their comms / cpu systems, their tracking systems, etc. all for a price. You go where they tell you and when. It's an industry that's almost impossible to run profitably as an owner operator, because those folks are skinned. But, people are in love with the idea of owning their own business - it's kinda like an MLM that way. Now, I founded a trucking company that had as many as 15 trucks that ran over the road, both owner operators and company owned vehicles. At my size, there were very few economies of scale and we ran at a break even, at best - closing after a few years. We paid teams .40 cents a mile, all miles, backing out the per diem and paying SS / payroll taxes on the balance - an ridiculously high workmen's comp (first year was 24%, went down to 16.5% later). I could go into more detail, but you get the point.

ohaideredevs 8y ago
I would be very interested in the details. I keep hearing about friends of friends who pull $80,000 driving a truck, $120,000 when they own one and half a mil once they own a couple. Too lazy to actually do the research, but curious how close these claims are to the truth. Obviously you are seeing a very different picture, and yours actually comes from experience.
- michaelmrose 8y ago
  Maybe they are quoting the money coming in before expenses like gas/lease etc? Maybe they put it an above average investment of time?
  - TylerE 8y ago
    Actually, time is pretty strictly regulated by the DOT. No more than 60 hours duty hours a week, no more than 14 duty hours in a row, of which no more than 11 hours can be actually driving, and must go off duty for at least 10 hours to reset the clock. Sounds more complicated than it is... once the duty period begins, any stops (fuel, breaks, meals, etc) do NOT stop the clock. This is why most long-haul operations use pairs of drivers... one will sleep in the bunk while the other drives.
    - michaelmrose 8y ago
      By most jobs definitions how much of an individuals waking life is consumed by work in this scenario over the course of a year?
      - relaunched 8y ago
        Trucking is a little different. I'm not sure the current regs, but driving time is logged differently than "on duty not driving" different than off duty. Typically, drivers are paid by the mile, so on duty not driving is unpaid, while doing tasks like DOT inspections, vehicle walk around, fixing stuff, tire pressure, break adjustments, shifting trailer pins, etc. Long haul teams can drive as much as 300+k miles per year. This typically consumes 50 weeks of being in the truck at least 6 days a week, simplifying at little.
- relaunched 8y ago
  Many ethnic enclaves have programs that get people their licenses and they get hired by trucking companies owned by folks from those enclaves. In my experience, thise types of drivers get between $500-$800 per week, cash. The owner of the truck's pay varies based on how they acquired their shipments, direct to shipper or via a broker. Their is a huge spot shipment market for small companies, which fluxuates wildly, at times. Ultimately, the rates vary greatly. Now, you can drive for a big outfit and make upwards of 70-80k gross, depending on experience, specialization, endorsements, etc.
deleted 8y ago
[deleted]
Joe-Z 8y ago
I‘m not sure I get the point. So you‘re saying most truck drivers can‘t afford health insurance, income protection, etc.? Are they in the group of the „working poor“?
deleted 8y ago
[deleted]
dexen 8y ago
>There has been a driver shortage for 10+ years How does that square with the low net compensation of the drivers? Is there perhaps a secondary mechanism, other than the (asserted) labor supply shortage, that depresses the wages?
- aaomidi 8y ago
  This is actually one of the cases where supply side economics breaks down. People refuse to pay more for this and if you've invested so much for truck, car insurance, etc...
  - zazen 8y ago
    To me, the question still stands: if people refuse to pay more for the service, then in what sense is there a shortage of the service? Can you expand on what you mean by "supply side economics breaking down"?
    - aaomidi 8y ago
      A lot of trucks are owner operated. They can't afford to not work - even though they know they will be able to potentially make more money. Owning a truck is a lot of maintenance - insurance, parking costs, etc. A lot of owners also have to pay lease, loans, etc. They can't afford to negotiate for better rates. Just because there isn't a lot of supply doesn't mean that rates go up!
      - zazen 8y ago
        I can see that small businesses aren't in a great position to negotiate with large businesses. But if there were really a substantial shortage, you wouldn't have to engage in high-risk, high-stakes negotiation to get a better rate. People will offer you a higher rate to secure your service, if your service is _really_ in short supply. If the people hiring these independent trucks can afford not to pay more, because they know someone else will take the lower rate, then there isn't a shortage. This could just about be the definition of whether or not there is a "shortage".

ohaideredevs 8y ago

I would be very interested in the details. I keep hearing about friends of friends who pull $80,000 driving a truck, $120,000 when they own one and half a mil once they own a couple. Too lazy to actually do the research, but curious how close these claims are to the truth. Obviously you are seeing a very different picture, and yours actually comes from experience.

michaelmrose 8y ago
Maybe they are quoting the money coming in before expenses like gas/lease etc? Maybe they put it an above average investment of time?
- TylerE 8y ago
  Actually, time is pretty strictly regulated by the DOT. No more than 60 hours duty hours a week, no more than 14 duty hours in a row, of which no more than 11 hours can be actually driving, and must go off duty for at least 10 hours to reset the clock. Sounds more complicated than it is... once the duty period begins, any stops (fuel, breaks, meals, etc) do NOT stop the clock. This is why most long-haul operations use pairs of drivers... one will sleep in the bunk while the other drives.
  - michaelmrose 8y ago
    By most jobs definitions how much of an individuals waking life is consumed by work in this scenario over the course of a year?
    - relaunched 8y ago
      Trucking is a little different. I'm not sure the current regs, but driving time is logged differently than "on duty not driving" different than off duty. Typically, drivers are paid by the mile, so on duty not driving is unpaid, while doing tasks like DOT inspections, vehicle walk around, fixing stuff, tire pressure, break adjustments, shifting trailer pins, etc. Long haul teams can drive as much as 300+k miles per year. This typically consumes 50 weeks of being in the truck at least 6 days a week, simplifying at little.
relaunched 8y ago
Many ethnic enclaves have programs that get people their licenses and they get hired by trucking companies owned by folks from those enclaves. In my experience, thise types of drivers get between $500-$800 per week, cash. The owner of the truck's pay varies based on how they acquired their shipments, direct to shipper or via a broker. Their is a huge spot shipment market for small companies, which fluxuates wildly, at times. Ultimately, the rates vary greatly. Now, you can drive for a big outfit and make upwards of 70-80k gross, depending on experience, specialization, endorsements, etc.

deleted 8y ago

[deleted]

Joe-Z 8y ago

I‘m not sure I get the point. So you‘re saying most truck drivers can‘t afford health insurance, income protection, etc.? Are they in the group of the „working poor“?

deleted 8y ago

[deleted]

dexen 8y ago

>There has been a driver shortage for 10+ years How does that square with the low net compensation of the drivers? Is there perhaps a secondary mechanism, other than the (asserted) labor supply shortage, that depresses the wages?

aaomidi 8y ago
This is actually one of the cases where supply side economics breaks down. People refuse to pay more for this and if you've invested so much for truck, car insurance, etc...
- zazen 8y ago
  To me, the question still stands: if people refuse to pay more for the service, then in what sense is there a shortage of the service? Can you expand on what you mean by "supply side economics breaking down"?
  - aaomidi 8y ago
    A lot of trucks are owner operated. They can't afford to not work - even though they know they will be able to potentially make more money. Owning a truck is a lot of maintenance - insurance, parking costs, etc. A lot of owners also have to pay lease, loans, etc. They can't afford to negotiate for better rates. Just because there isn't a lot of supply doesn't mean that rates go up!
    - zazen 8y ago
      I can see that small businesses aren't in a great position to negotiate with large businesses. But if there were really a substantial shortage, you wouldn't have to engage in high-risk, high-stakes negotiation to get a better rate. People will offer you a higher rate to secure your service, if your service is _really_ in short supply. If the people hiring these independent trucks can afford not to pay more, because they know someone else will take the lower rate, then there isn't a shortage. This could just about be the definition of whether or not there is a "shortage".