Who are California's Independent Owner-Operators?
Gursimrat S. Sandhu
An independent owner-operator is a truck driver who owns and operates his or her own truck. In California, tens of thousands of truck drivers choose to work as independent owner-operators because of the freedom and flexibility that work model affords them. Independent owner-operators have found the freedom to spend more time with their families, earn higher wages and, for some, the ability to start their own trucking business.
Did you know?
According to the Owner-Operator Independent Drivers Association, there are approximately 350,000 owner-operators registered in the United States. The average owner-operator has been independent for 18 years.
In 2014-2015, the California Trucking Association (CTA) partnered with the Inland Empire Economic Partnership (IEEP) to develop a study that would quantify the net earnings of California Independent Owner-Operators (IOOs) and compare their earning power to the broader workforce.
Our analysis finds that:
In 2013, the independent owner-operators studied earned a median net income of $59,478 compared to $42,078 median pay of employee drivers in California.
Three-quarters of independent owner-operators earned more than drivers in employer-based models.
The top 20 percent of independent owner-operators earn more than workers in 156 of the 158 logistics occupations in Los Angeles County and the Inland Empire, including those with Bachelor degrees.
This study summarizes and examines data from a wide range of sources:
California Employment Development Department’s (EDD) Occupational Employment Statistics survey,
U.S. Census Bureau,
American Transportation Research Institute; and,
28 different trucking firms which include data from 2,648 California IOOs.
This data was used to characterize gross revenue and business expenses for IOOs such as repairs and maintenance, fuel and insurance, mileage, and other applicable costs.
Average median net income for independent owner-operators
Number of owner-operators
registered in the U.S.
Percentage of independent owner-operators who purchased or leased equipment on their own
Independents Owner-Operators Choose Arrangements
That Benefit their Business
Trucking companies and independent owner-operators may jointly arrange equipment leases at terms more favorable to the independent owner-operator, but this is not always the case.
The 2014 ATA Driver Compensation Study by the American Trucking Association shows that of those surveyed:
55 percent of independent owner-operators purchased or leased equipment without help
36 percent secured equipment with assistance from carriers
9 percent received some type of assistance from carriers
Protecting The Independent Owner-Operator Model
On April 30, 2018, the California Supreme Court voted unanimously against Dynamex to effectively prohibit all independent owner-operators from contracting with businesses if they provide work similar to their normal services. CTA and two California independent owner-operator drivers took action against this unconstitutional ruling, filing a lawsuit in defense of the more than 70,000 truckers whose livelihoods are under siege with this court decision.
This ruling set a new precedent for determining employment status in the state with a new court-established "A-B-C test," a set of criteria that threatens to eliminate the independent contractor model in California for nearly all industries, including trucking. As this fight stands before us, it is important that we unite to keep the American trucking dream of working independently alive.
If you are an independent trucker or wish to voice your support for entrepreneurs in the trucking industry, please visit our support page and share your story and passion with us!