@article{Johnston:207109,
      recid = {207109},
      author = {Johnston, Ahren},
      title = {The impact of hours of service changes to motor carrier  profitability and productivity},
      address = {2012-03},
      number = {1431-2016-118751},
      pages = {9},
      year = {2012},
      abstract = {With the major change to the Federal Motor Carrier  Administration (FMCSA) Hours of Service rule (HOS)  announced in late 2011, there have been several studies  regarding highway safety and the health of truck drivers  but relatively little research on the impact on  profitability of firms. The Regulatory Impact Analysis  (FMCSA, 2010) includes an estimate of the cost of reduced  productivity at the macro level but not at the firm level.  The estimates used to calculate reduced productivity were  also called into question in a paper prepared for the  American Trucking Association (Edgeworth Economics, 2011).  The last major change to HOS was in 2003 and went into  effect in 2004. This 2003 HOS reduced the total allowable  on duty time by one hour and increased the allowable  driving time by one hour; however, the real maximum driving  time in 24 hours was effectively reduced from 16 to 14 with  the requirement of 2 additional hours off duty. Before the  final 2011 HOS were publicized, there were options to  decrease the maximum driving time by 1-2 hours and to  decrease the maximum on-duty time. The final 2011 HOS did  not make any changes to the maximum driving time but the  FMCSA retained the option to make further adjustments as  more studies on the impact become available. Furthermore,  the new rules will have minimal impact on the maximum  on-duty time for many carriers and with long detention  times. While the maximum on-duty time is technically  reduced with the addition of a mandatory 30 minute break in  addition to the 10 hours off duty per day, the definition  of on-duty time will no longer include time in the truck  waiting to be loaded or unloaded. Looking at the impacts of  the previous change to HOS should give a good indication of  the impact to carriers if maximum driving time is further  reduced in the future. This paper investigates the actual  impact of the last major change to the HOS on profitability  and productivity of publicly traded motor carriers.  Quarterly data from 1997-2010 for 14 publicly traded motor  carriers was used. To see the impact on profitability,  Operating Ratio (OR) and Return on Assets (ROA) were  dependent variables in two separate models. The variable of  interest was a dummy variable with a value of one for the  time periods after the change to HOS (2004-2010). To see  the impact on productivity, a similar model was tested with  sales per employee as the dependent variable. Results of  the estimations indicate that the 2004 HOS led to an  increase in both productivity and OR, or costs as a  percentage of sales, and no significant change to ROA.},
      url = {http://ageconsearch.umn.edu/record/207109},
      doi = {https://doi.org/10.22004/ag.econ.207109},
}