Driver pay pressure rises as capacity declines

“The competition for drivers is just going to continue to intensify as the year goes on,” Peters said. (welcomia/Getty Images)

The trucking industry is facing increased pressure to reassess driver compensation despite lingering uncertainties and headwinds.

The Q2 2026 Driver Recruiting & Retention Data Download Report found that competition for drivers has rebounded as freight market indicators improved, driving up hiring costs and prompting the return of sign-on bonuses. The Conversion Interactive Agency and People. Data. Analytics report also found that 26% of carriers have increased driver pay in 2026.

“We are definitely going to see it continue to intensify,” said Priscilla Peters, Conversion’s vice president of marketing. “But I think the most compelling thing today, when you look at it, is that this competition is not driven really by demand.”

The Department of Transportation accelerated a decline in capacity last year by tightening enforcement of non-domiciled commercial driver licenses and English-language proficiency standards. Trucking has been stuck in a prolonged downcycle in part because capacity added during the previous upcycle has outpaced freight demand.

“The competition for drivers is just going to continue to intensify as the year goes on,” Peters said. “There’s still tight margins in trucking, and so, the balance of compensating drivers, and being able to offer a good compensation package, and still operate with a good [operating ratio], that’s a balance that carriers really have to look at.”

Peters said a modest improvement in freight demand and longer-term factors such as an aging driver workforce are adding to the pressure. She also sees fleets taking a more targeted approach, emphasizing tenure, safety, fuel economy and other driver-specific incentives. Some fleets are even considering percentage-based pay tied to the freight being hauled.

“The recent pay increases we’re seeing from large carriers appears to be less about an immediate industrywide driver shortage, and really more about positioning for the next phase of the freight cycle,” said Josh Lovan, industry business adviser at J.J. Keller. “The economy is often cyclical, especially in the transportation sector, and larger carriers are preparing.”

That positioning already is showing up in pay packages. Crete Carrier announced increases ranging from 1 cent to 3 cents per mile for over-the-road, regional and dedicated drivers effective May 30. The increases also applied to Shaffer Trucking drivers, raising starting pay for new OTR drivers to between 64 cents and 69 cents per mile. Crete ranks No. 32 on the Transport Topics Top 100 list of the largest for-hire carriers.

“We have great customers with great freight, and our customers want us to do more,” Crete President Tim Aschoff said at the time. “We want to say thank you to our drivers for the quality service they provide that makes this pay increase possible.”

Other fleets have followed suit. TMC Transportation introduced three new driver pay initiatives June 29, including increased holiday and tarp pay and the return of the continuous run program. Melton Truck Lines increased mileage pay for company drivers by 5 cents to 8 cents per mile May 29, while Maverick Transportation announced pay increases for flatbed over-the-road and select dedicated drivers.

“The current capacity crunch is a combination of completely normal dynamics and some wrinkles introduced mainly due to use of regulatory enforcement,” said Avery Vise, vice president of trucking for FTR Transportation Intelligence. “The drop in capacity is no surprise as it had been happening steadily for more than 2½ years.”

Vise said driver payrolls typically begin rising within a few months of a clear market inflection and then accelerate as recruiting programs ramp up. He added that there still are signs of that trajectory in the truckload and less-than-truckload sectors, even though overall truck transportation payroll employment has been slow to grow this year.

“Adding to this natural dynamic is the pressure on foreign drivers from the Federal Motor Carrier Safety Administration,” Vise said. “While we continue to investigate the enforcement impact, we currently think that two factors are more significant than the number of drivers directly removed by English language and non-domiciled CDL enforcement.”

Vise pointed to what he called a “chilling effect” from that enforcement, with some immigrant drivers leaving the market out of fear. Another consequence, he said, could be drivers becoming unwilling to operate in certain lanes.

“The big metrics to watch are just those freight levels and capacity,” Lovan said. “They’re just trying to make sure they’ve got the necessary equipment and drivers to handle the third and fourth quarter, and then see what happens with that momentum, how it swings into 2027.”

Lovan cautioned that outside pressures continue to weigh on the industry. He pointed to geopolitical tensions such as the Iran war and their impact on fuel prices and inflation. The uncertainty is particularly challenging, he said, because there is no clear timeline for a resolution.

“They see this war potentially winding down and better times ahead,” Lovan said. “The stock market’s been ready to just eat for a long time, but there’s just all that outside noise. I think people just really are forecasting that those issues are going to be resolved into 2027.”