Truck drivers are some of the country’s top earners and for a good reason. They work tirelessly to keep our world turning and our economy thriving. So it’s no surprise that a truck driver’s salary is competitive compared to other industries. On average, a truck driver can earn anywhere between $40,000 and $78,000 per year. But, did you know there are some states where the money for trucking is even better? However, you must be careful when deciding on where to go. In some states, the cost of living and state regulations could significantly impact the amount of money you actually make.
Like any profession, each state offers different pros and cons. For instance, while one state may see a higher average annual pay, other factors like natural resources and geographic proximity could impact that number, ultimately making you less than the supposed average. That’s why it’s crucial to weigh all factors carefully before deciding where to reside as a truck driver.
In most industries, the average pay varies from state to state, and, in some cases, the pay doesn’t always correspond to the cost of living within said state. Most of the time, a truck driver’s income is based on the specific route they drive, the type of freight they’re hauling, the difficulty of the job, and the company’s standards. But unfortunately, most companies don’t factor the cost of living into their wages. So, if you choose a state with a lower cost of living, your paychecks will go further.
2. Income Taxes
You must also consider the state’s income tax rates. If you want more take-home pay, you’ll want to choose a state with a lower income tax rate. As of 2020, only seven states offer no personal income tax, including Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. With these rules and regulations constantly changing, it’s wise to seek advice from a tax professional before deciding on a new job in a new state.
3. Quality of Life
While pay is a crucial factor when choosing your career and the location you’d like to work in, it should ultimately come second to the quality of life. For instance, some states offer better roads and highways, safer public rest areas and truck stops, and cheaper parking. These factors not only make your job easier, but they can help to reduce out-of-pocket costs and stress. You’ll also want to look into your state’s crime area to ensure the safety of your home and neighborhood.
4. State Regulations
Like pay, industry regulations can vary from state to state, and these regulations can impact trucking companies and drivers. And if the trucking company is on the smaller side, they could have trouble adapting due to limited resources. Unfortunately, if the company doesn’t have access to things like new equipment and personnel, these regulations could come at a high cost. If these added costs are passed on to the customers, you could see reduced pay.
5. Geography and Natural Resources
You should also consider the type of freight you’ll be hauling, the population, the geographic location, proximity to other states, international borders, and shipping ports when choosing a state to work in. You’ll also want to determine what natural resources the state you’re considering is known for since there’s a good chance you will be hauling it at some point or another.
6. Freight Volume
As previously mentioned, you’ll want to consider the amount of freight you’ll be hauling across states. The amount of cargo you handle often affects the pay you’ll receive per job. The states with the most freight being moved include Texas, California, Illinois, and Ohio.
The type of freight is also necessary to note, as it can also determine how much money you could be making.
Top states for flatbed hauls: Alabama, Texas, Arkansas, Georgia, and Mississippi
Top states for refrigerated loads: Texas, California, Illinois, Ohio, and Georgia
Top states for van loads: Texas, Illinois, Ohio, California, and Georgia
What are the best states for truck drivers?
Ready to find new territory? Make sure you get the most up-to-date information before deciding where to land.
The demand for trucking has taken a shocking turn. According to Bank of America, shipping demand is “near freight recession levels,” and the prospects surrounding freight capacity, inventory levels, and shipper rates are moving in a similar direction as they were in the Summer of 2020, at the height of the COVID-19 lockdown.
The managing director of Bank of America, Ken Hoexter, said in a recent investor’s note that a survey found that the demand for trucking is down 23% year-over-year (y/y), and the Truckload Demand Indicator fell to ‘58’— the lowest it’s been since June 2020.
So, what does all of this mean for the future economy? This article will break down what led to this decline in demand and what we can expect to see in the future.
The demand for trucking: Then vs. now
The need for trucking has, for the most part, been a significant pillar in the foundation of our country. Now, as the demand for trucking is slowly dwindling, industry experts wonder what the future holds for the trucking industry.
In the Cass Freight Index, the demand for domestic shipping increased 0.6% in March from the prior year (2021); the percentage is also a 2.7% increase from February. At the end of this year’s first quarter, the creeping growth rate shows Cass Information Systems Inc. that the freight industry is clearly slowing down.
The trucking industry recently experienced historical highs when it comes to freight rates, but those numbers seem to be decreasing as shipping demand and available capacity reach an equilibrium. For example, according to Bank of America, dry van spot rates (excluding fuel surcharges) are down 27% in the past month and 37% since December 2021. The analysis from Bank of America also shows that shipping rates have dropped to their lowest point since July 2020.
Why is the demand for trucking declining?
Over the years, the trucking industry has proven to be a reliable gauge for the U.S. economy’s prosperity or lack thereof. It’s simple math, really—when consumer spending declines, companies purchase less, and, as a result, business in the trucking industry dwindles.
These concerns led policymakers to raise shipping rates by a quarter-percentage point and promise half-point increases starting in May. This increase has caused freight volumes to slow. Since March, the Cass Freight Index shows shipment components are up 0.6% y/y, but this is significantly less than the 3.6% y/y growth the industry saw in February.
Other shipment component stats include:
Although the shipments component rose 2.7% from February, the overall seasonal pattern was still 1.0% lower.
If the Cass Freight Index used a normal seasonal pattern from March to predict shipment components for April and May, we would see an approximate 3% y/y increase in April and a 3% y/y decrease in May.
The year-over-year shipment growth decreased to 0.4% in the first quarter of 2022 from 4.3% growth in the fourth quarter of 2021.
The changes to shipping rates have Wall Street traders predicting a 100% chance of a half-point rate increase at the beginning of May. If they are correct, this increase would be the first time the U.S. central bank has raised federal funds by 50 basis points since 2000.
While some economists believe the actions of the Federal Reserve are too late, others are concerned that stabilizing prices too quickly could trigger a wide economic recession since higher interest rates force consumers and businesses to reduce their spending.
Suppose industries such as retail, housing, and lumber predict needing fewer heavy-duty trucks for shipping. In that case, the trucking industry would be plunged into a recession. This downturn could lead to many businesses going bankrupt, thousands of people across affected industries losing their jobs, and American families severely disrupted. Thus, leading to a nationwide economic crisis.
The world of insurance has dramatically evolved over the last few years. Companies once offered basic plans for a standard rate. Now, they offer a host of customizable options at different prices and programs that give you the chance to save money. For example, some insurance companies now offer mobile apps or devices that plug into your vehicle and monitor your driving habits. If you prove to be a safe driver, you can save on your monthly costs. This new type of insurance could be transformative to those who own and operate small fleets.
Recently, many providers have introduced a new category of insurance called “usage-based insurance,” or UBI for short. Like the previously mentioned program, usage-based insurance uses different mediums to track drivers’ habits. However, UBI generally focuses on the number of miles one has driven or the usage of the covered vehicle and bills accordingly, hence the name usage-based. This type of plan makes it possible for owner-operators to save significantly on liability insurance and only pay monthly instead of in full.
In today’s world, there has never been a higher demand for the work of a truck driver. However, like many industries, there are moments of delay or total standstill. It’s for these reasons that those who own and operate the world’s fleets need coverage that offers flexibility.
You get great discounts and savings. Most insurance companies who offer UBI also offer a 10-25% premium discount for responsible driving. Plus, you may continue to receive this discount every year if you continue to qualify.
Employees can be tracked. Typically, with usage-based insurance, the covered vehicle and driver will receive a physical device or mobile app that provides geofencing and alerts you if the vehicle has gone outside of the predefined limits or even exceeds the speed limit.
Drivers will gain better driving habits. As previously mentioned, most UBI coverage includes a telematics device that allows you to monitor your drivers. So, if they brake too hard, drive above the speed limit, or use evasive maneuvers, you’ll know. This “eye on the inside” will allow you to address these unsafe driving habits and save money as they improve.
Accident investigations are easily handled. If the insured vehicle is involved in a collision, it’s easier for the authorities and claim investigators to pinpoint the cause of the accident, leading to a more accurate claim.
What are the disadvantages of usage-based insurance?
It doesn’t recognize defensive driving. As mentioned above, telematics devices can monitor one’s driving habits and report them back to the insurance company. However, there are many instances where drivers must use defensive driving skills to avoid an accident. In many cases, these monitors cannot know the difference between reckless driving and protective measures.
Privacy risks included. The trackers used with usage-based insurance store a ton of data, including driving information, location, and more. This data is then linked to your name and stored in a database. How this information can be used past the insurance company is vague, especially since they must always be on, or you risk losing your savings.
It can be somewhat of a hassle. For companies with a more extensive fleet, the installation process and overall learning curve require a large amount of effort that may or may not be worth the savings.
For businesses to be successful, they must optimize their processes and reach as many customers as possible in the most cost-effective ways. Without the supply chain, this goal for prosperity would be unachievable. The world’s supply chain works around the clock to ensure the distribution of products, resources, goods, and information to consumers around the globe. To maintain this constant flow of movement, the supply chain must rely on three major components, including logistics, operations, and budget.
As the world continues moving towards the new normal, hardworking professionals are looking for essential careers that are high-paying and offer long-term viability and opportunities for advancement—and there’s no better place to look than the supply chain.
In this article, we will list the top 10 jobs in the supply chain industry and go over what it takes to land these lucrative careers.
How do I qualify for a job in the supply chain?
Jobs within the supply chain are high-paying and relatively easy to obtain with the proper skillset and experience. Top positions, like supervisory and management roles, require a bachelor’s degree and several years of experience within the area you are applying for.
However, some positions only require a high school diploma and industry experience. Starting at entry-level roles, like Production Associate or Inventory Clerk, will allow you to gain the necessary knowledge and progress within your chosen field.
The job of a transportation manager is to plan and lead all transportation operations. Opportunities for this position can typically be found at companies like Amazon, Ryder, or even smaller logistics and trucking companies.
Facilities managers oversee the maintenance of a company’s equipment, systems, and other physical components within the production and manufacturing departments. This position could grant multiple opportunities since many facilities managers work with more than one location.
Purchasing managers (or procurement managers) supervise an organization’s purchasing habits for their materials, products, and services. They work to develop relationships with suppliers and handle negotiations to ensure the best prices for their clients.
Purchasing manager opportunities can be found in industries such as:
Logistics analysts study warehouse data, product delivery, and supply chain operations, then use said data to make recommendations and improvements for logistic processes. This position is typically found in larger companies, specifically those that manufacture consumer goods.
However, you may also find opportunities at logistic companies, membership-based retailers, and other customer-based industries such as:
Supply chain managers work with external suppliers to negotiate and purchase resources and raw materials. They also analyze processes and company data to identify inefficiencies and improve overall quality throughout the supply chain.
This position is also related to and sometimes paired with titles like:
The job of a global commodity manager is to create and implement strategies that help an organization achieve and maintain efficient and cost-effective operations. These professionals also study market trends and develop forecasts for inventory fluctuations while maintaining relationships with suppliers and monitoring product quality.
Have you ever thought about starting your own business? How about starting your own trucking business? If you answered yes, you are in luck because there’s never been a better time to get started.
As the popularity of online shopping rises and the world’s shipping demands rapidly increase, owners and operators alike can anticipate more opportunities on their horizons. To meet the growing demands of consumers, the American Trucking Association (ATA) estimates that the trucking industry would need at least 900,000 new drivers on the road. These factors, plus the current driver shortage, strong freight market, and increased transportation rates, equal an abundance of opportunities for those wanting to start their own trucking business.
So, how exactly do you get started?
6 Tips For Starting Your Own Trucking Business
While running your own fleet operation can come with a number of enticing benefits, it can be challenging to get everything started if you don’t have the proper tools for success.
Below, we’ll break down the steps you need to take and discuss how to create a solid trucking business.
1. Plan and prepare.
Not surprisingly, starting a business takes a significant amount of planning and preparation, regardless of having zero industry experience or years under your belt.
Some things to think about and plan for include:
1) The name of your trucking business
Choosing a proper name for your business is crucial. Once you’ve decided on a name and checked to ensure another company is not using it, be sure to acquire a DBA if you chose a “fictitious name” or an LLC if you are operating under your name and/or professional alias.
2) What’s your target market
Establishing your trucking business as a “niche carrier” (e.g., local hauler vs. refrigerated hauler) is vital if you want to avoid competition, optimize your opportunities, and streamline the costs and resources you’ll have to prepare for.
If you’re stuck deciding on your company’s niche, ask yourself:
Which industries, companies, and/or products do I find interest in? Is it in my target location? What’s my competition, if any?
What does this niche require in terms of product and logistics? Am I capable of meeting these requirements?
Who would my customers be? How will they benefit from me versus another company? How would I benefit from them?
3) Identify your rates
Deciding on your company’s rate can be a challenge. Your rate should generate profit, cover any costs, and compete with any neighboring competition.
To calculate your rate, follow these steps:
Choose your desired area and freight lane
Go to the local load site and find 10 loads going in the same direction
Contact the brokers of the 10 loads and inquire about how much they are paying
Calculate the average amount and add 10-15% to determine the price shippers are billed
Now, repeat these steps for shippers going in the opposite direction
International Registration Plan (IRP) License Plate
Heavy Highway Use Tax Return (Form 2290)
International Fuel Tax Agreement (IFTA) Permit
Weight/Distance Travel Permits
Standard Carrier Alpha Code (SCAC)
Electronic Logging Devices
3. Create a business plan.
For any business, a detailed business plan is an essential tool for success. A comprehensive business plan should detail sales and marketing strategies, operational activities, a pricing breakdown, your fleet management plan, company goals, a resource breakdown, and any other business processes that will help keep you organized as your business grows.
A complete business plan may also include:
The company description
A market analysis and service business analysis
The company’s sales strategy and financial projections
A personnel plan with management and organization details
An executive summary
Any key activities, partnerships, & resources
Your customer segments
Any value propositions
Your company’s cost structure
4. Purchase company assets and insure them.
If you have substantial funding, now is the time to purchase your company assets, including your commercial vehicles. And while there is nothing wrong with getting the best deal, don’t neglect the quality of your purchases. When getting started, paying a higher price for a brand-new truck may not sound appealing; however, this will save you money down the road with less required maintenance and fewer repairs.
If you choose to buy a used heavy-duty truck, you should investigate the vehicle’s maintenance history and look for/at:
Signs of damage
Rust or deterioration
Proper tire tread
Mileage and other gauge readouts
Once you have purchased your assets, be sure to insure them immediately. By obtaining insurance, you protect yourself and your company against financial burdens and risks, including vehicle damages and employee injuries.
Who you bring onboard is arguably one of the most important components to growing your business. There are a few ways to handle the hiring process. Still, it’s recommended to go through certified screening procedures to determine if a potential employee holds any violations, crash reports, or unfavorable record hits.
Running the applicant’s CSA profile and a thorough background check
Conducting a detailed in-person interview
Completing on-the-job tests and evaluations
6. Now, grow your business.
Now that most of the nitty-gritty details are taken care of, it’s time to grow your business! For optimal profitability, diversify your business and never allow a single client to account for over 20% of your revenue, meaning you should have at least five consistent clients. If you need more clients, you can use online tools, including freight boards, a company website, industry networks, and/or social media. With your company’s website and social media accounts, be sure to keep things professional, up-to-date, and consistent with relevant content like services, hours of operation, and company details. If you post any photos and/or videos, only use high-quality content and take the opportunity to interact with your followers any chance you get.
Other tools trucking companies use for growth and success include:
Fleet management software
An ELD solution
Real-time GPS tracking, geofencing, and facility insight reports
These tools can optimize your company’s time, cut down excess expenses, help improve your driver’s productivity and safety, simplify insurance claims, and protect your business. Plus, they keep downtime to a minimum and keep clients happy, encouraging them to spread the word about your company.
Get started with Mission Financial.
When starting your own trucking business, it’s essential to obtain proper coverage. At Mission Financial, we not only offer direct lending, but we also offer dealership lending. Our specialized loans cover first-time owners/operators, drivers with limited experience, and owners/operators with bad credit, bankruptcies, child support, or tax liens, plus small fleet loans.
To obtain a loan from Mission Financial, you will need to complete and submit three online forms, including a credit application, vehicle spec sheet, and sales order.
Take a moment and think, what is one industry that has been behind the success of every other business in the world? That’s right, the trucking industry.
There’s no denying that the profession of trucking has and continues to be one of the largest contributors to the American economy. Without it, millions of hardworking individuals would be without a job, and other businesses, like Amazon and Walmart, would collapse due to limited resources and the inability to ship. Different vital industries like construction, oil and gas, and automotive would also suffer greatly without trucking. And without the success of these enterprises, America’s economic infrastructure would ultimately give way.
So you see, truck drivers indeed are the backbone of our society, the oil that keeps the machine running smoothly, if you will. Fortunately, the essential occupation doesn’t seem to be going anywhere, making it one of the most secure jobs in the world. The only thing left to do is pick the type of driver you would like to be. No pressure.
Built differently than traditional tractor-trailers, flatbed trucks typically require additional training or education to execute safe and effective operations. On top of that, their drivers must thoroughly understand what they will be hauling and how to secure it properly since flatbed loads must be secured differently from tractor-trailer cargo. Typical freight includes vehicles, military vehicles, oversized freight, and oddly shaped cargo that doesn’t fit well on other truck types. Fortunately, since flatbed trucking is more demanding, it typically offers higher pay than different driving positions.
Dry van trucking is an excellent position for those entering the occupation with minimal experience. These drivers are typically responsible for single trailer rigs that contain items like non-perishables and dry goods. A bonus for this title is that drivers are often not accountable for unloading upon arrival.
If dry goods aren’t your thing, you may be interested in becoming a tanker. Tankers primarily transport a variety of liquids, including gasoline, chemicals, and even milk. However, there are times that tankers will also be responsible for hauling dry products like cement or sugar. But in some cases, these drivers could also be dealing with highly explosive chemicals and gases. Since moving this delicate cargo can be, in some ways, dangerous, special training is required before starting this job.
Otherwise known as commercial truckers, freight haulers specialize in moving cargo that does not fit into a specified category like reefers and tankers. These drivers need to be flexible and good with change.
Refrigerated freight truckers have a pretty strenuous position. They are responsible for hauling loads that need to be kept at specific temperatures, like food, meats, highly perishable goods, medical products, and body products. That all being said, it’s crucial that reefer drivers know how to regulate the trucks’ temperatures, monitor for fluctuations, and adequately store freight for best refrigeration and temperature stability. Like flatbed drivers, reefers are often paid more than other types of drivers due to the amount of responsibility they are charged with.
Local, regional, and OTR drivers are labeled or defined by the mileage they acquire. While local drivers only haul within a city, regional drivers often move freight throughout an entire state or metropolitan area. For OTR drivers, they have the potential to be given routes across the United States.
Auto haulers, are given special trailers that can hold an abundance of various automobiles. Where they are taking these automobiles varies. Drivers may be transporting from auctions, local vehicle lots, or ports; you name it. With tens of thousands of dollars on the line, you better believe this job comes with a more than fair wage.
The typical hazardous materials driver will haul fuel, compressed gas, chemicals, waste, and other flammable/combustible materials. It’s crucial for drivers to be knowledgeable about the contents they’re hauling and how to handle them safely in the event of an emergency. To ensure everyone’s safety, special training, certifications, and/or permits will be required.
LTL, or Less Than Truckload, drivers move smaller freight and don’t need to go as far as standard shipments. With their cargo being on the smaller side, they will typically have multiple stops to make in one day and are generally responsible for unloading their own freight.
The trailers that sit close to the pavement and the truckers who drive them are low boys. These rigs sit lower to accommodate taller equipment or cargo and provide stability with a lower center of gravity. In most cases, these trailers are hauling overly large freight, like manufactured homes, construction equipment, etc. However, these low boys don’t fly solo. They often are escorted by vehicles with flashing lights and signs that read something like ‘Caution’ or ‘Oversized Load.’
Which Type of Truck Driver Should I Choose?
It’s clear that trucking is not only a high-demand profession, but it is a career that offers flexibility, the opportunity to travel, and the chance to meet and develop camaraderie with fellow drivers. Regardless of your age, gender, or educational background, your chances of achieving success are just as probable as the next. Best of all, the variety of job titles allows you to choose an occupation that best suits your life.
Before deciding, you’ll want to consider personal factors such as your location, risk tolerance, situation, and experience. For example, if you’re new to the industry, you won’t want to dive headfirst into something like transporting hazardous materials. There is a great likelihood that you will hold multiple positions with various skill requirements throughout your career. So, use this list as a guide to discover where to start or where to go next.
Want to know how much truck drivers make? Download our infographic!