The vast majority of trucking company executives expect to be paying more in drivers’ wages in 2015, according to the Transport Capital Partners’ Business Expectations Survey.
After surveying executives of both large and small carriers, TCP – in conjunction with Americas Commercial Transportation Research, Co. – compiled stats in various categories including rate trends, wages, drivers and future volume expectations. Small carriers were defined as those with annual revenue below $25 million, with large carriers having revenue exceeding $25 million. Approximately 37 percent of executives surveyed owned small carriers.
Approximately 55 percent of those surveyed expect driver wages to increase 0-5 percent in the next 12 months, with 40 percent expecting a higher increase of 6-10 percent. Less than 10 percent expect no change or any kind of decrease. Small carriers were more optimistic about a 0-5 percent increase, whereas large carriers were more likely to project increases in the 6-10 percent range.
Most executives expect rates to increase in the next 12 months. However, optimism was much higher with large carriers having 91 percent expecting rates to increase compared with only 70 percent of small carrier owners. Despite a disparity in opinions of future rates, an overwhelming majority of all carrier owners reported an increase in rates in the last three months. Very few experienced any kind of decrease.
In terms of capacity, 40 percent planned to add capacity at a rate of 1-5 percent, and 25 percent expect to increase capacity 6-10 percent. A quarter of those surveyed reported that they have no plans of increasing capacity in 2015. Large carriers were more likely to not add capacity and were less likely to add 6-10 percent when compared to small carriers.
There may be plenty of room to negotiate, according to survey results. Executives were asked if they expect to renegotiate any of the following accessorials – detention time, fuel surcharges, quicker payment schedules, miles paid, other charges – or if they had no plans for any kind of renegotiations. Nearly 70 percent were open to renegotiating detention time, the highest percentage of all categories. Fuel surcharges and quicker payments were at the bottom of the list at less than 30 percent planning to renegotiate those areas.
Inexperienced drivers may have something to look forward to in the future as well. More than 80 percent of the executives polled support allowing younger, properly trained drivers to enter the work force as a way of attracting new drivers. Also, 64 percent would be interested in hiring inexperienced, entry-level drivers and training them. Large carriers were more likely to hire inexperienced drivers at 70 percent with only 54 percent of small carriers having an interest. About a third of all carriers reported that they currently employ inexperienced drivers.
Despite all of the optimism, only 33 percent of carrier executives reported “Yes” when asked if trucking is starting to be fun again. A little more than 10 percent said flat out “No,” and the remaining 55 percent replied with “Some days.” Large carriers were twice as likely to believe trucking is fun again compared to small carriers.
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