After protracted labor negotiations in 2022 and a much-covered derailment in Ohio this year, critics of the railroad industry have sought to advance their narrative, arguing that railroads are deeply flawed. The root cause, detractors posit, is an operational model called Precision Schedule Railroading (PSR), which aims for efficiencybut is now cartoonishly cast as the downfall of the industry.
Critics claim that railroads, propelled by the dark magic of PSR, care too much about making money and not enough about employees or safety. It is easy to get lost in the invective, hyperbole, and misleading oversimplifications. But it is critical to keep an eye on the facts, and to know the whole story.
For instance, detractors like to cite the figure of 1,000 derailments per year, because it sounds alarming. But the rest of the story is that 76% of those derailments were in rail yards, not on the main rail lines that carry freight around the country. Yard derailments are akin to parking lot fender benders. While work clearly remains to drive all incidents lower, rail is by far the safest way to move freight on land. According to federal data, the industry saw the lowest number of hazmat incidents in its history last year. Additionally, large railroads mainline accident and employee injury rates in 2022 continued an era of all-time lows.
While were considering the rest of the story: We estimate that unionized rail employees earn more than 93% of U.S. workers across industries. At the end of the current contract, the average total compensation for a rail employee will be $160,000. And railroad employees enjoy premium healthcare plans, far richer than those offered to most U.S. workers.
While public attention was narrowly focused last fall on short-term sick leave, rail employees have long enjoyed generous long-term leave policies. And just as railroads said they would, they continue to ink new sick leave policies with unions. To date, nearly 40 such agreements have already been reached as carriers also address scheduling issues.
As in other industries, the size of the rail workforce has been reduced from its historic high. But the rest of the story is that rail employment today is at its highest level in three years, and railroads continue to hire amid an economic slowdown.
Railroads capital spending is six times that of the average manufacturer. That continual investment is the source of the undeniable rail safety gains over the last two decades.
This reality has not appeased the loudest critics, beholden to a set of dated anti-corporate talking points from 2017. Not all railroads embrace the tenets of PSR, and no railroad deploys the same operating plan, but all railroads share the same goal: making the most of available resources and delivering freight at a reasonable rate. Topline growth is a constant refrain among rail leaders, and multiple railroads have announced that executive compensation will hinge more on safety, service, and growth, and less on efficiency.
Feeling a need to act swiftly following the February derailment, some lawmakers are pursuing far-reaching policy changes. While some legislative proposals include sensible ideas, many would needlessly hamstring railroads. Prescriptive inspection protocols, shortsighted technology mandates, and even a provision that freezes current staffing models into place in perpetuity have no place in safety legislation.
Facts are stubborn things, especially if they dont advance a convenient storyline. This is especially true in the case of U.S. freight railroads, which have historically operated out of sight of many Americans. Its time they know the whole story.
Ian Jefferies is the president and CEO of the Association of American Railroads.
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