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    10,149.240
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  • OTVI.USA
    10,139.180
    -75.530
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    2.500
    0.000
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    151.000
    5.000
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    1.795
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  • DATVF.CHIATL
    1.738
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  • DATVF.DALLAX
    1.102
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  • DATVF.LAXDAL
    1.495
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  • DATVF.SEALAX
    0.835
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  • DATVF.PHLCHI
    0.975
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  • DATVF.LAXSEA
    2.250
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  • DATVF.VEU
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  • DATVF.VNU
    1.448
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    2.5%
  • DATVF.VSU
    1.299
    0.009
    0.7%
  • DATVF.VWU
    1.542
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    4.2%
  • ITVI.USA
    10,149.240
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  • OTRI.USA
    3.780
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  • OTVI.USA
    10,139.180
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News

The road to riches is paved by owner-operators

A new report shows self-employed drivers earn more than company drivers.


Bucking trends in industries with similar workforce demographics, self-employed truck drivers earn more per hour and work more hours for more money than company drivers who are paid per mile or per hour, according to an analysis conducted by Aaron Terrazas, Convoy’s director of economic research.

His report, based on the U.S. Census Bureau’s American Community Survey (2015-2017), and Current Population Survey (1990-2018) casts light on why drivers might decide to work for companies or strike out on their own.

“Despite the risks, the upside for truckers who want to be self-employed is clear,” Terrazas writes. “Being an owner-operator can be both more lucrative and provide more autonomy for the best drivers.”

According to Terrazas’ analysis, once you control for factors such as age, education, family status and sex, owner-operator truck drivers earn on average about 5 percent more per hour or around $1,900 more per year compared to company drivers. 

Not controlling for demographic factors, owner-operators earn on average 16 percent more per hour – nearly $6,000 over the course of a year – than company drivers. 

The edge self-employed truck drivers hold over their full-time counterparts contrasts with jobs that employ workers with similar demographic profiles. In construction and mining, for example, both earnings and hours are lower among the self-employed. Likewise, in food service, the self-employed work longer hours for less money per hour than wage and salary workers. 

Terrazas’ findings contain a couple of qualifiers. First, there are huge variations in the amount of money individual owner-operators earn. For example, the top 10 percent of owner- operators earn 52 percent more per hour than company drivers, about $19,200 more over the course of a year, after controlling for demographic factors; the bottom decile of owner-operators earn 30 percent less per hour than company drivers, or about $11,000 less over the course of a year.    

Owner-operators also work about 2 percent more hours, which translates to about 1.1 more hours on the job each week than company drivers. (Some of the overtime may be due to drivers getting around hours of service rules, a practice that may come to an end with the full implementation of the  ELD mandate.)

The advantages that accrue to some owner-operators lessens somewhat when you factor in the overall risks associated with being self-employed. Owner-operators are responsible for maintenance costs of their vehicles and are also more vulnerable to economic cycles. During the boom years of 2005 and 2006, the hourly earnings premium for owner-operators was around 16 percent, but in 2008-09 during the Great Recession, it essentially disappeared. 

The analysis doesn’t specifically address the issue of truck driver shortages or the role driver pay has in contributing to those shortages, Terrazas told FrightWaves in an email. But a separate Convoy report showed that over the past three decades, total earnings among drivers has lagged behind earnings for workers more broadly, although it has kept pace with earnings among workers in occupations like construction, mining/extraction and food service. 

“Obviously higher pay would help attract more workers, but there are also substantial lifestyle and regulatory barriers that prevent would-be drivers from entering the profession,” Terrazas said.

The number of truck drivers who are self-employed – 11 percent – has stayed flat since the early 1990s. Among workers across all jobs, self-employment has been slowly trending lower, from about 16 percent in the early 1990s to about 15 percent today. 

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Linda Baker, Staff Writer

Linda Baker is a FreightWaves staff reporter based in Portland, Oregon. Her beat includes early-stage VC, freight-tech, mobility and West Coast emissions regulations.

23 Comments

  1. They pay tolls, repairs, fuel, maintenance
    Not worth it IMO.
    With the regulations today.
    Plus a 4 digit truck payment?

  2. I am skeptical of this article as well, having seen both sides for 30+ years. My observation has always been that “behind every successful owner-operator is a wife/spouse earning $75,000 annually” doing something else.

  3. Does this factor in benefits company driver get on top of pay (company provided heath ins,retirement contributions) or cost associated with being self employed (occupational accident, health insurance, self employment taxes, time spent working on the truck included in “hours worked per week” )?

  4. Your data base is way off. Figure in truck payments fuel taxes repairs tires truck insurance health insurance the list go on been owener, operator 23 years no retirement to speak of long hours lots of scafices with family stop writing half truths please

  5. I chose my being an owner-op for many reasons . Forget the head aches part , I had a share of headaches working for as a company driver …. Hell , I didn’t get free health insurance as co. driver …. The write off is a win plus….. If you don’t know math , then I wood suggest steering holder is your life . I’m a 45 yrs. , in driving , roughly half the career as own-op .

    1. Most of these broke homeless looking old men wandering around truckstops are so called O/O’ s. They don’t have a pot to piss in or a window to throw it out. Losers. I’m a 61 yo company driver, pull down between 75 and 80k a year. Full benifits with 100% paid health ins. I wouldn’t trade places with 98% of O/O’s for All the tea in China.As soon as I’m 65 I’m done with a well funded retirement.

      1. I’m a one truck operation running my own authority. My business pays my health insurance, I put 6k a year into a 401k, I pay myself the maximum allowable Per Diem, I have a base salary of 58k a year, and I put 2k a month of profits into the bank for future investment in the business. My total compensation is 70,000 a year. I could pay myself more, but I’m more interested in having a cash pile in the bank. This is possible in current market conditions. I pull reefer general freight with a new truck and new trailer, not used or old equipment. It’s all about discipline.

      2. Great for u sir would like to work for a company that treats a driver that well,your bless.

  6. First, I love comments about factoring in expenses. It petty easy to see they have done that or they would be saying O/O’s earn $100k more per year.
    I will say at first i was sceptical considering the source. It is like the annual doom and gloom report from Coyote. I was expecting it to say being an OO is great. They want OOs.
    But then the small spread. Having been an OO and work with many OO, the risk for such a small reward doesn’t seem worth it.

    1. I don’t think being a company driver is all good or bad or that being an OO is all good or bad. For a small spread, the risks of being an OO wouldn’t be worth it. To me, if someone has a good driving record, is disciplined, can manage their expenses better than the average company driver, knows a bit about truck maintenance, is a good fit with a carrier that has a good OO program, etc., the earning potential is far greater than $2,000 more per year over a company driver. OOs at good carriers are often netting $80,000 – $120,000 per year. Obviously, a lot of factors can play into that. If the OO chooses to run at a carrier that pays $1.25 per mile including fuel surcharge, well, it’s going to be more difficult to get that spread and the margin for error is small. The only good business reason I can understand running as an OO at one of those companies with lower pay would be that someone is newer to the industry or trying it out before they bite off more.

  7. Wife and I are we team for company that you no longer working we averaged over a hundred twenty five thousand between the two of us and our best year was 136000 we received a new truck every two years and had no other expenses we also have six weeks off a year we are retired now but this was 10 years ago we work for them for 8 years do your multiplication I don’t think that’s too bad money and we also did not have to get rid of a truck when we were done working and we had a 401k each and they matched it up to a percentage and when we got home we didn’t have to work on a truck our time was ours

  8. If you buy a truck you better be ready to pull Max shifts and a minimum of 3500 miles a week. Think Max efficiency all day everyday… It’s not easy.

    Better yet is to get paid percentage and run HARD coast to coast running reefer.
    Unless your truck is paid off Max logs all day.

    Where a driver is grossing 6-8k a month the o/o takes home 12-18k depending on payments and fuel economy.

    This business is not ez and being an oo isn’t for everyone, that’s for sure, the stress of having an older truck is crazy…
    Is it worth it?
    Lots of sacrifice for owners but it’s worth it if you know the formula.

    1. Globetrotter, your comment is the most accurate. Most of the comments regarding this article are merely personal justifications of the writers’ choice.

  9. Being a true O/O is far better than being a company driver. O/O net double sometimes triple the amount of a company driver and o/O work far less. That’s after expenses and everything else. Yes it’s more paperwork but the write offs alone. No force dispatch, go home when you want for how long you want. Go where you want to go. If you want to stay in the south during the winter months then you do that. If you’re unhappy with the job you go to another carrier that pays good. Most O/O don’t get paid by the miles but by % pay. O/o can work local and take home $2k per week after fuel and insurance. After all the write off hardly pay anything in taxes. If you’re going to be away from home and your family maximize your income. You should set up your own retirement plan and your own medical. Or if you have a wife who works get on her insurance. Or if you’re a really good o/o and your wife works for your company ? and makes a good salary that also helps when tax time comes, For you guys afraid of the taxes.

  10. O/O works best for me. I’ve been a company driver, a trainer, and a yard manager. I’m single and work as much as I did when I was a company driver. I made $9286 EBITDA in June, after expenses ( with honest logs). Just like OTR is not for everyone, neither is being an O/O.

  11. This entire article was off track. 46 hours a week? Where do you come up with these numbers? As an owner operator and still making truck payments even after all expenses including 22% for taxes, I still cleared over $17k in the past 12 weeks alone. Let me also make clear that my truck payments are over $3k a month.

  12. Soooo untrue…
    Who ever doesn’t drive a truck can not talk or write about anything when it comes to trucking. So please stop, keep your political and double face writings and statistics to yourself and to those that you fork for.

  13. Overtime may be due to getting around HOS? Seriously? Company drivers don’t maintain their vehicles, do the additional paperwork required to run a small business or find the freight to keep that truck running to make that extra $11-19k per year.

    As a writer for a ťrucking paper your ignorance is staggering.

  14. The focus of the article in my opinion is on the Top 10% of IOO’s. Good driving records equal lower insurance costs. Industry experience to make good business decisions and as mentioned in the above comments taxes & investing. The Top 10% rolling those large cars have proven relationships to find freight/trade into new equipment from an equitable position/focus on paying less taxes to increase their income.

  15. Company drivers do not have all the responsibility of running a business but to simply do their job and get paid. Thus, they may get paid less than some Owner Operators but they are not having to carry all the stress of running a business.

  16. Great for u sir would like to work for a company that treats a driver that well,your bless.

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