SONAR Indices & Insights: Stay ahead of a truck driver shortage using these truck driver indices in SONAR

Adam RobinsonFreight Market Blog

In this edition of “SONAR Indices & Insights,” the SONAR team showcases several truck driver indices full of transportation data to aid carriers in staying ahead of any potential truck driver shortage within SONAR, the freight forecasting platform from FreightWaves. This week, learn how asset-based and asset-lite carriers are monitoring truck driver and owner-operator indices to keep a pulse on any freight KPI shortcomings within their driver workforce. In this article, carriers will learn about 4 indices within SONAR to aid in understanding their current state of driver operations:   

  • Owner Operator Driver Percentage (OWNOPS)
  • Truck to Driver Ratio (TDRAT)
  • Driver to Non-Driver Ratio (DRRAT)
  • Driver Turnover (%) (DRVTO)

What are the SONAR indices that aid in staying ahead of the truck driver shortage?

There are four available indices that aid carriers in monitoring their workforce operations and keep ahead of any truck driver shortage in their operations, which often are a leading indicator of potential shortcomings in available capacity. Let’s teach you what each is followed by what they tell asset-based and asset-lite carriers. 

Owner-Operator Driver Percentage (OWNOPS)

The Owner-Operator Driver Percentage (OWNOPS) provides a measure of the degree to which carriers, on an aggregated basis, are utilizing Owner Operator (Independent Contractors) relative to total driver count. The carriers reporting the freight data for this index are participants in Truckload Carriers Association’s TPP program.

The formula for Owner-Operator driver percentage is as follows: (Total OO Count) / (Total Driver Count)) * 100.

truck driver shortage Owner-Operator Driver Percentage

The SONAR chart above shows the Owner-Operator driver percentage in the three equipment types: dry fan, reefer, and flatbed.

This index, for small populations of drivers, is highly dependent on the States and Provinces that each reporting carrier operates within. This is due to regulations (existing or proposed) regarding the usage of independent contractors. On an aggregated basis, the OWNOPS index informs the user of the relative popularity of this operating model within trucking and a peek at indicators of a forthcoming truck driver shortage by showing how many drivers are available to hire, as a high percentage indicates that there may be fewer drivers available to hire.

Truck to Driver Ratio (TDRAT)

The Truck to Driver Ratio (TDRAT) provides a measure of the number of active (plated) tractors, relative to the number of active drivers, for reporting freight carriers. The count of drivers included in this index capture both part-time and full-time employees, and independent contractors. For part-time, the counts are reported on an FEL basis (Full Time Equivalent). The carriers reporting the data for this index are participants in Truckload Carriers Association’s TPP program.

The formula for Truck to Driver Ratio is as follows: (Truck Count) / (Driver Count).

truck driver shortage Truck to Driver Ratio (TDRAT)

The SONAR chart above shows the Truck to driver percentage in the three equipment types: dry fan, reefer, and flatbed.

Ideally, carriers have a calculated index value of 1:1 or higher. Anything less indicates unseated tractors, which, as a by-product, indicates lower asset utilization and a need to start hiring for more drivers to stay ahead of a future truck driver shortage.

Driver to Non-Driver Ratio (DRRAT)

The Driver to Non-Driver Ratio (DRRAT) index captures the total number of active drivers for each active non-driver. “Non-drivers” include all operations and admin personnel, but does not include shop personnel (technicians, service, admin). The count of drivers and non-drivers accounts for both part-time and full-time employees and independent contractors. For part-time, the counts are reported on an FEL basis (Full Time Equivalent). The carriers reporting the data for this index are participants in Truckload Carriers Association’s TPP program.

The formula for Driver to Non-Driver Ratio is as follows: (Driver Count) / (Non-Driver Count).

truck driver shortage Driver to Non-Driver Ratio (DRRAT)

The SONAR chart above shows the Driver to Non-Driver percentage in the three equipment types: dry fan, reefer, and flatbed.

The DRRAT index shows the degree of operating leverage carriers have within their respective businesses. The higher the number, the more operating leverage the company has. This index is highly dependent on operating mode, as some operating modes require a higher number of admin and operations personnel relative to driver counts. Higher values within a specific operating mode indicate better utilization of technology and sophistication of admin and operations personnel that are thriving, even if there are others who state they are facing a truck driver shortage.

Driver Turnover (%) (DRVTO)

The Driver Turnover (%) (DRVTO) index provides a monthly reading of Annualized turnover, specific to an employee and independent contractor drivers within the truckload segment of the North American trucking industry. The turnover results for reporting carriers are ‘annualized’ in this index to provide the viewer with a better understanding of results relative to a calendar year basis. Turnover is one of the best ways to know if there is a potential truck driver shortage. When used alongside other freight data indices, such as the volume and rejection indices, carriers can start to plan for initiatives to source more drivers to hire. The carriers reporting the data for this index are participants in Truckload Carriers Association’s TPP program.

The formula for Driver turnover percentage is as follows: (( Drivers Departed * 12) / ((Driver Count Beginning of Month + Driver Count End of Month) /2)) * 100.

truck driver shortage driver turnover

The SONAR chart above shows the driver turnover percentage in the three equipment types: dry fan, reefer, and flatbed that are company-owned. Carriers may also see the turnover percentage on leased equipment only, or together with company-owned assets.

Higher turnover results indicate difficulty, for reporting carriers, to retain qualified drivers to fulfill trucking capacity obligations due to potential truck driver shortage issues. Higher turnover can result from internal and external (other industries) competition for labor. To reduce turnover, carriers will increase base and incentive compensation, adjust their freight networks to be more ‘driver friendly’, and provide additional benefits to offset competing forces for human capital.

Keep ahead of a potential truck driver shortage and monitor carrier operations by purchasing and using SONAR

In turbulent times, asset-based and asset-like carriers need certainty to stay ahead of the freight market and understand the impacts any current market is having on carrier operations. The premier freight forecasting engine, FreightWaves SONAR, allows carriers to benchmark, analyze, monitor and forecast a potential industry-wide truck driver shortage in SONAR. 

SONAR ensures more proactive responses to the market, provides correlations between several indices to guide decisions and helps to manage freight budgets or margins more proactively. Click the button below to get a demo of SONAR to see what the platform can do for you.