Off To A Good Start

I can’t think of a brighter beginning to the new year than the news that many large carriers are introducing better owner-operator pay packages this month. This is no great surprise. The on-and-off economy of the past two or three years ended 2003 more on than off, increasing demand for stable contractors. And the expected loss of productivity due to the new hours-of-service rule only heats that demand further.

Besides that, though, the scrappy owner-operators who’ve made it through the past few years have some financial catch-up to do:

  • Average owner-operator income has stagnated in the low $40,000 range or dipped below it in recent years, based on Overdrive research.
  • Fuel prices never retreated from the escalation that began in 1999. Prices during 2003, reaching as high as $1.77 last March, exceeded average prices in 2001 and 2002.
  • Many owner-operators, like many fleets, have postponed buying cycles due to the introduction of new engines last October. It’s past time to trade up.
  • Because of the adaptations to meet emissions standards, and perhaps other factors, owner-operators are concerned about spending too much on equipment. An Overdrive survey shows the cost of equipment is second only to fuel costs as readers’ major concern about the industry. Only 60 percent listed equipment costs as a prime worry in 2001; 73 percent said so in late 2003.
  • Carriers who are among the first to raise owner-operator pay will reap the benefits: first choice among the safest, most productive drivers. Other carriers of all sizes will likely follow suit since pay is number one on contractors’ incentive list. This rising tide that should lift all boats – and trucks – is well overdue.

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