A popular saying in the transportation industry is “Where trucking goes, so goes the economy.” It’s usually referring to the health of the trucking sector being a crucial benchmark of overall economic well-being. A stronger economy means more loads and better rates. A weak economy means tighter margins and stiffer competition. The trucking industry has been in a protracted freight recession, as excess capacity is being “cleansed” through bankruptcies, drivers exiting the industry with severely depressed Class 8 orders and a glut in the used vehicle market.
Barriers to entry are low in the trucking industry. All an owner-operator needs is a commercial license, access to an “insured” truck and they’re in business. Non-domiciled Commercial Drivers licenses, first introduced in 2017, originally intended to allow drivers residing in one state to obtain a license in another. It evolved to include non US-residents, sometimes without legal-residency and often without necessary work permits. Since the FMCSA permitted foreigners to receive CDLs in March 2019, over 200,000 have been issued. In that same period the trucking industry added more than 310,000 trucks.
Trucking industry executives have struggled to understand how capacity grew quickly, in such a short amount of time. After years of complaining about a non-existent driver shortage, the growth of CDLs coincided with an explosive growth in trucking capacity. There are three times as many people with commercial licenses and qualifications, as there are trucking jobs. The major factor in the longest freight recession is a glut of truck drivers. It’s been clear for a while, that the industry doesn’t need more truck drivers. Through its unchecked growth, it’s driven overcapacity, suppressed rates and created an unsustainable environment for legitimate operators.
Truckers’ Issues Affect Canadians
Most people know transportation professionals, logistics and fleet mangers and truck drivers. To understand where the world’s going, we’re told to talk to the “working man”. The issues affecting the trucking industry are relevant to the wider economy. Truckers value independence, responsibility, safety, reliability, adaptability and a strong work ethic. They provide values-in-action leadership and influence the everyday conversations that Canadians are having.
There are those who believe the Freedom Convoy preceded the overturning of pandemic restrictions and mandatory vaccinations for federal employees. As an industry collective, truckers complained about temporary foreign labour before it was identified as a cause for youth unemployment. For over a decade, the Canadian Trucking Alliance and Ontario Trucking Association have been warning, and educating the public, on worker exploitation, tax-avoidance and safety concerns related to the Driver Inc. business model.
Extensive lobbying efforts led to an end of the deeply unpopular, Carbon Tax, a favourable outcome for all Canadians. The reintroduction of T4As for independent contractors in the trucking industry is the culmination of a 10-year battle for integrity in the trucking industry. In the recently passed budget, the federal government has also promised funding for issues related to compliance. WSIB is ramping up enforcement and training in joint initiatives with agencies that serve the trucking community. Letting drivers know about their worker rights and identifying carriers suspected of misclassifying drivers.
Alberta recently cracked down on fraudulent activity in the trucking industry, shutting down five truck training schools and 13 carriers. The closures came after a six-month investigation that uncovered fraudulent reporting and record keeping, as reported in Today’s Trucking. With better awareness of fraud in trucking, insurance underwriters’ are more closely scrutinizing fleets, which is reflected in higher customer premiums. Transportation professionals believe there’s reason for optimism. The opportunity for industry transformation could be significant.
Optimism is Spreading
A reversal in Canadian-US trade relations and Trump’s sovereignty threats has initiated a renewed spirit of Canadian patriotism and country unity. It’s fueling a strong “Buy Canadian” movement. Consumers are consciously choosing domestic products and buying local, as an act of defiance and in support of our national economy. The recent budget signals Mark Carney’s government is interested in pursuing nation-building projects that are reminiscent of a more prosperous time in Canada’s history.
Manufacturing sales rose 3.3% to $ 72.1 billion in September, their highest level since February. On November 14/25, Stats Canada reported that sales rose in 14 of the 21 subsectors (it tracks) with total sales up 2.7% for the month, in constant dollars. Also reported, the overall September manufacturing sales were lifted by a 9.2% gain in the transportation equipment subsector with motor sales up 11.8% and aerospace products and parts up 13%.
Canadians are feeling more hopeful about our country’s prospects. A Leger poll this spring shared that 85% of respondents felt proud to be Canadian. We overwhelmingly feel a strong sense of belonging to Canada, an increase from 2022, when 72% of Canadians reported that feeling. A strong sense of belonging is associated with other indications of well-being, such as life satisfaction and positive future outlook.
Across age groups, there was notable growth in our pride. Although younger Canadians are less likely to report feeling proud to be Canadian, 69% for 25-34 year olds felt that way. It may not seem like much when compared to Canadians aged 65 – 74, with 9 in 1) who felt proud or very proud to be Canadian (88%). But they experienced the largest increase since the fall of 2024, with nine percentage points. We know when Canadian youth is feeling more hopeful and positive, something good is happening.