What’s behind March’s jump in trucking jobs?

Until March, for-hire trucking appeared to be stuck in neutral in terms of employment with little change in payroll job levels since October. Although some indicators of activity – spot market metrics, for example – seemed to reinforce the sluggishness, there were some green shoots in the portion of the economy linked to freight that might have suggested some emerging freight strength this year.

Then came the employment situation report for March, which changed the picture in two ways. First and most obvious was the seasonally adjusted 9,600-job increase, according to preliminary Bureau of Labor Statistics estimates. Second, earlier estimates for January and February were upwardly revised by a net of 1,200 jobs.

We will look a bit closer at the significance of stronger employment and what might have led to them.

A big increase historically

In an industry that boasts more than 1.5 million payroll employees, a 9,600-job increase in a month might not sound all that impressive, but it is quite notable. Consider that 9,600 jobs in a month is:

• The largest monthly gain for trucking since January 2022.
• The 16^th largest monthly increase in the almost 35 years BLS has tracked trucking employment. At least two of the 15 larger increases were due to the end of Teamster strikes.

It’s important to remember, though, that the March figure is preliminary and subject to change. Substantial revisions are common, though they could be in either direction.

Delving into the why

For now, we can only analyze the data we have, so we will presume that the March increase in trucking employment was 9,600 or thereabouts.

For many industries, understanding job changes is quite simple because output is so transparent. For example, we generally can correlate employment changes in manufacturing sectors with industrial production moves in those same sectors. Trucking is more complicated because the government does not have a reliable monthly estimate of truck freight activity, and the huge number trucking operations – even those with hundreds of trucks – makes anecdotal explanations tricky and unreliable.

The real reason for a sharp job gain likely is more complicated, but for this analysis we will lump the possibilities into two broad buckets: Supply and demand. Let’s start with demand, which is a necessary ingredient even if it is not the only one.

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Rising Freight Demand

The most obvious potential reason for trucking’s sudden addition of more workers – which really means more drivers – is a notably stronger industrial sector, especially in February. On a seasonally adjusted basis, manufacturing output rose 0.9% to its strongest level since October 2022. Automotive production was a big factor in that growth, jumping 8.5% m/m.

Perhaps as significant as the recent strength in manufacturing output is the fact that it followed a downward trend. Trucking companies had not been hiring drivers needed to handle that strength, hence the relatively sudden need for more drivers.

Another factor – and one that probably is at least somewhat related to stronger industrial output – is the strength in imports during the first quarter as U.S. businesses sought to build some inventory cushion to reduce the financial hit from tariffs. U.S. intermodal volumes have been very strong this year for this reason. Some of that import activity clearly flowed through to trucking. Trucking probably benefitted from imports especially in the Eastern U.S., which is more trucking-friendly territory due to shorter distances to destination than imports coming into West Coast ports.

The notion that carriers needed more drivers is reinforced by recent trends in weekly earnings. Average weekly earnings in for-hire trucking had been rising steadily, but they slumped in the second quarter of last year. That changed late in 2024 with sharp increases in December and January, suggesting greater tightness.

With the possibility that both manufacturing output and stronger imports are linked to tariff avoidance, rising demand in the first quarter of 2025 does not necessarily suggest that demand will continue to be strong for the rest of the year. The April jobs report should help us understand to some degree how significant tariff avoidance might have been for trucking.

Greater driver availability

The principal factor in stronger employment is almost always greater demand, but access to a larger driver pool can be a factor, too. The best example of this phenomenon is the second quarter of 2022 when skyrocketing diesel prices and falling spot rates sent the proprietors of very small trucking companies looking for company driver jobs. The trucking industry – especially truckload – was happy to oblige and recorded a sustained surge in employment over several months.

The problem with this theory as an explanation for the latest run-up in employment is that the data on carrier exits is not telling us that there is a surge underway. In fact, in March, the net decrease in the for-hire carrier population was a mere 11 carriers, according to FTR’s analysis of Federal Motor Carrier Safety Administration data. In all of Q2, the decrease was less than 1,200 carriers, which is the smallest quarterly net change since the population started to go negative in the fourth quarter of 2022.

That performance suggests that a supply-driven increase in employment is unlikely, and it probably is, frankly. However, it’s critical to understand what this data represents. FTR tracks revocations of authority net of reinstatements. If a driver decides to quit operating as an independent carrier, it takes time for that action to show up in FMCSA data. The typical process would be that the trucking firm stops paying its liability insurance premium, leading the insurance carrier to notify FMCSA of that fact, triggering a revocation notice. The revocation notice then gives the carrier 30 days to find more insurance, which – in this scenario, at least – won’t happen. Only then does the shutdown show up in the data that FTR tracks.

It's possible, therefore, that carrier exits have risen recently, perhaps due to soft dry van and refrigerated spot rates, high financing costs, or rising insurance and equipment costs. Or maybe tariffs have scared very small carriers, and they are seeking more stability in company driver jobs.

Time will tell, of course.

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