The freight market over the past two years has been defined by a correction cycle that’s seen demand remain sluggish and capacity slip out of the market due to suppressed freight rates and increased costs. The pressures fleets faced in 2021 and 2022 to persistently and meaningfully increase driver wages to attract and retain drivers had waned by early 2023. From a driver pay perspective, 2023 and 2024 were mostly defined by small, incremental growth trends in the for-hire trucking segment.
Closing 2024 and entering 2025, though, flickers of upward momentum for driver wages have emerged in the for-hire segment, and analysts widely expect the freight market to enter a recovery period this year and for freight rates to begin an inflationary cycle.
Meanwhile, at private fleets, dedicated 3PLs, and companies with location- and job-specific hiring needs — those who recruit at narrower points of the driver hiring funnel (read more below) — benchmarking activity and compensation adjustments remained active through the market correction over the past two years.
Where does this put the driver market in 2025? What will influence driver wage momentum in the year ahead? How much will wages grow and change this year?
NTI’s 2025 Driver Market Forecast explores those questions in depth, providing an overview of the driver market within the broader U.S. labor market and the trends and systemic factors influencing driver supply, driver demand, and, of course, driver wage momentum in 2025.
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Four critical factors determine the environment for driver pay changes. Over the past two years, they’ve been static. Their direction in 2025 will determine how much and how often pay moves this year. Here’s where they stand now and how each could evolve to affect driver pay movement in the coming year:
Driver turnover: Although hiring pressures eased, driver turnover has remained elevated over the past two years. As the chart below shows, the number of monthly average driver hires outpaced even the robust hiring years of 2021 and 2022. There’s also likely pent up demand among drivers to transition jobs once hiring demand ramps up — either to chase better pay, a different schedule, more productivity, or for a different work environment for other reasons. Turnover is expected to remain elevated through 2025 and could even be exacerbated if the freight market enters an inflationary trend. Elevated turnover puts upward pressure on driver pay, so the higher turnover rates become, the more pressure fleets will feel to raise wages.
Driver supply: Trucking unemployment has been declining over the past two years as fleets have sought to right-size due to economic conditions. Hiring needs have slowed down, and the industry as a whole has removed the emphasis on attracting new entrant drivers. Capacity, in terms of carrier count, has been exiting the marketplace. Thus, driver supply is in a neutral territory. While deep-rooted structural issues persist that constrain driver supply (read more below), supply is currently in a neutral territory and will likely remain neutral through the early phases of a freight recovery. Where supply becomes critical is at the tighter parts of the hiring funnel, which you can read more about below.
Freight rates: Freight rates in late 2022 and into 2023 tumbled as the supply-demand dynamics in trucking shifted. Simply, there were too many trucks and fleets vying for too little freight, causing both spot rates and contract rates to slide. Throughout 2023 and 2024, rates remained stuck. While rates have been sluggish to start 2024, they are forecasted to climb in 2025. If freight rates climb, for-hire driver wages will follow suit.
Capacity demand: As noted with freight rates, demand for capacity slipped in 2022 and into 2023. While demand has plateaued, the industry’s supply and demand dynamics remained out of balance through most of 2024. Any increased demand in capacity would put upward pressure on rates and upward pressure on driver pay movement.
While freight volumes, capacity, and freight rates play pivotal roles in dictating wage momentum for professional drivers, those forces increasingly are being counterbalanced by broad, structural effects of the U.S. labor market and entrenched constraints in driver supply. The industry’s correction cycle has masked underlying challenges that all industries face, including and especially in industries like trucking, construction, manufacturing, and other industrial sectors. While the labor market has been in a correction cycle, too, with unemployment rates creeping up and job openings rates gliding downward, both readings still indicate a historically challenging market for companies to hire and retain workers.
While there have been plenty of headlines in recent years about layoff activity, it’s only moved the employment rate slightly, and much of that activity has been concentrated among job types in more white collar segments of the employment market.
The U.S. unemployment rate is hovering around the 4% mark, which translates to a critically challenging environment for trucking fleets, while the job openings rate is hovering around 4.5% — a historical high mark that indicates a still-strong appetite among employers for available workforce. However, the labor market pressures overall have eased over the past two years. What happens in the broader economy relative to public policy around trade and interest rates will continue to shape employers’ appetite and ability to hire workers — and what happens with unemployment and job openings rates.
Specific to trucking, the implementation of the Drug & Alcohol Clearinghouse in early 2020 has sidelined over 180,000 drivers as of the beginning of 2025 — and that number continues to grow every month. Only a fraction of those drivers have completed the return-to-duty protocol, but many fleets wouldn’t hire them if they did, meaning those 180,000 (and growing) drivers have basically been removed from the driver pool. In sum, more than 270,000 drivers have received a violation.
Age and health factors also continue to plague driver availability. Retirements and age-outs annually account for a significant source of industry exodus, and health-related issues sideline more than 300,000 drivers annually.
The industry also still struggles to connect with and hire younger generations, with the average driver age stuck at 54 years old. While hundreds of thousands of new drivers earn CDLs and enter the industry every year, attrition and churn make it difficult for the driver pool to meaningfully grow to meet demand.
What’s more, many if not most fleets require a minimum of two years of driving experience to be hired. So the annual wave of new entrants and exits does little to grow the pool of drivers with two-plus years of experience and to address the point in the driver supply funnel where most fleets begin recruiting.
What can fleets do? Addressing these issues requires fleets to be creative and driver-focused in their approach to recruiting and retention programs. Make health and wellness a critical fleet-wide concentration that puts drivers first. Implement hourly pay or guaranteed weekly pay to bridge the gap for drivers’ unpaid working hours. Find ways to hear drivers’ honest feedback and work to address issues to bolster retention. Utilize KPIs that take an honest assessment of your fleet’s performance in driver retention and build pillars to address weak spots. Actively build programs to attract new drivers to the industry. Be active in your own community at the high school, community college, and trade school level to attract younger workers to trucking and to your company. Vitally, ensure you’re benchmarking wages and benefits so drivers are compensated appropriately and have access to valuable resources like health insurance and retirement savings.
NTI does expect the dynamics impacting driver pay to shift this year, with pay beginning another upward cycle. The current freight ebb persists, and wage activity will see small gains until that ends. Capacity is exiting the market, but demand hasn’t rebounded. Until the supply and demand dynamics change, fleets will remain cautious in their approach to the market, their decision making, and their evaluation of costs, including driver pay.
But with turnover elevated, the new entrant pipeline being depleted, ongoing driver supply constraints persisting, and underlying shortages of transportation workers (drivers, techs, warehouse workers, etc.) still entrenched, fleets will see pressures to be active in adjusting pay to attract drivers and retain them — especially at the market level — when demand rebounds.
With companies pausing training programs and hiring partnerships with CDL schools, the industry is eroding the foundation for tomorrow’s needs. Inexperienced drivers who obtained a CDL hoping to work for a specific company or find a job at all in trucking have found themselves on waiting lists or without opportunities due to their lack of experience. The opportunities open to them are the toughest, least desirable jobs — OTR, long-haul, irregular route with little home-time and lowest pay among industry sectors. Thus, even when new entrants do find a job, they can become quickly disillusioned with their new career and leave the industry. Churn among new drivers is immense and significant in the first 120 days.
That’s what happened in 2019. When the market regressed after the 2018 boom, a similar theme played out in 2019. There was an oversupply of capacity combined with less demand, and companies right-sized and the industry’s driver pipeline was depleted. When demand returned starting in late 2020, companies and the industry as a whole had to rebuild and retrack the pipeline of driver hiring — which created tremendous pressure for fleets of all types to grow at the rate they wanted. It also caused wages to soar.
Since 2019, despite success of attracting new drivers to the industry, trucking has struggled to make in-roads with younger generations. Millennials and Gen Z, comprising workers approximately 40 and under, are vastly under represented in trucking compared to the general U.S. workforce. On the flipside, Baby Boomers and Gen X are overrepresented in trucking. While that’s an issue today, it’s even more critical looking at the years ahead. By next year, it’s estimated that Gen Z will make up a quarter of the U.S. workforce, and Millennials will make up more than 40% of the U.S. workforce.
As Baby Boomers, currently comprising 1 of every 4 workers in trucking, continue to age out of the industry and retire, will the industry be able to attract younger generations in the volume needed to replace them?
Here’s a look at the current age data of trucking compared to the general workforce, as well as data showing the industry’s regressing in this area rather than progressing:
NTI’s forecast for base pay growth (mileage and hourly wages) in the for-hire carrier segment in 2025 is 2.7% — double that of last year’s growth. The most momentum will continue to be concentrated among drivers at the narrower end of the hiring funnel outlined above — drivers with experience and for jobs requiring higher labor and increased qualifications or endorsements. However, fleets in irregular route OTR trucking will also see greater pressures this year to raise pay than in 2023 and 2024.
For private and dedicated fleets, NTI estimates wage activity to remain heightened. Most private and dedicated fleets structure their driver compensation programs on a market-level basis. NTI forecasts market-level wage growth to average between 2% and 5% in 2025, depending on hiring activity and competition for drivers in those locations, driver supply and availability, and the nuances of the job, such as labor level, experience requirements, shift type, and more. Here’s a look at how private fleet wage growth on an annual basis has compared to for-hire fleet pay momentum since 2008:
While 2023 and 2024 saw a brief respite for the industry to catch its breath after a tumultuous series of jolts in recent years, NTI contends that the broad, ongoing changes to the U.S. labor market and perpetual driver supply constraints will continue to spur motor carriers and private fleets to evaluate and implement structural changes to how they hire and pay professional drivers.
The industry must grapple with a convergence of factors: Shifting generational attitudes as Baby Boomers and Gen X cohorts retire and age out of trucking and are replaced by Millennials and Gen Z cohorts; perpetual and systemic blue-collar labor shortages; and rising insurance costs that will continue to push pay packages that promote safety over productivity (such as hourly and guaranteed pay options, while per-mile will continue to decline in prevalence).
Those trends point to a continued shift toward location-based hiring that puts an emphasis on more home time, more predictable and flexible scheduling, and more predictable and understandable compensation plans.
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On the first Thursday of every month, NTI President & CEO Leah Shaver, aka the Sunshine Girl, goes live on air on SiriusXM Channel 146, Road Dog Trucking, to talk with drivers about all things pay. From paycheck questions to working with fleets on resolving issues around compensation, HR and legal, life on the road, and relationships with their employers, Payday on Road Dog Live dives into topics drivers care about most.
Catch every episode live on SiriusXM, SiriusXM.com, or the SiriusXM app, where you can also listen to episodes on demand.