(The following article by C.M. Mortimer was posted on the Pittsburgh Tribune-Review website on February 20.)
PITTSBURGH — Rising demand for freight transportation has sparked a hiring boom in the rail industry that hasn’t been felt in four decades.
The nation’s railroads are experiencing a surge in traffic over the nation’s 142,000-mile network, a boom that set new records nearly every month.
The freight rail industry’s growth and energy efficiencies have also allowed it to fight back against the trucking industry, a longtime rival.
“This will be a record year,” says Tom White, spokesman for the Association of American Railroads, a Washington, D.C.-based trade group that represents companies that provide 93 percent of the nation’s rail service.
Kerry Bell, 50, works as a loader in the warehouse at the Westmoreland Logistics Park Rail Freight Intermodal Terminal in East Huntingdon, Westmoreland County, adjacent to Sony Technology Center-Pittsburgh. The Bullskin, Fayette County, man lost one job when Montgomery Ward closed in March 2001, and another when Ceodeux Inc., a valve manufacturer, moved some production to Mexico last summer.
“Basically, I did a lot of the same work at Montgomery Ward, but there, you’re under the gun a lot. You really have to move orders,” Bell said of the rail business.
Railroads employed about 1.8 million workers during World War I, but jobs began to dwindle after 1920 because of competition from other forms of transportation and government regulations. Employment dropped to about 174,000 last year, but the railroads plan to hire more than 80,000 workers over the next six years, according to the trade group.
“We hired 2,000 new workers last year, and estimate we’ll need about 2,000 annually for the next five years,” said Rudy Husband, spokesman for Norfolk Southern Railway, Richmond, Va. Norfolk Southern employs more than 28,000 workers in 22 states, including about 5,000 in Pennsylvania.
Getting workers won’t be easy
But recruiting workers to fill the openings won’t be easy.
“The work hours in the rail industry are difficult. The environment consists of long hours and unusual shifts. Railroads run constantly,” said Russell A. Peterson, president of Carload Express Inc., a Verona-based rail group that includes Southwest Pennsylvania Railroad, Allegheny Valley Railroad and Camp Chase Industrial Railroad, based in Columbus, Ohio.
Peterson said he is looking to hire six to eight workers, but the process can be tedious. He said he may interview 35 individuals, but only find five people he can use. Peterson said it takes 400 hours to certify a locomotive engineer, based on federal regulations.
He also said potential hires may be scared off by a job that could require night, weekend and holiday work schedules, or by random drug testing.
“The railroads have been hiring significantly for the first time in over 40 years,” said Frank Wilner, spokesman for the United Transportation Union, the Cleveland, Ohio-based union that represents 125,000 brakemen, conductors, engineers, switchmen and yard masters.
Four major railroads do business in Pennsylvania — CSX Transportation, Norfolk-Southern Corp., Canadian National Railway and Canadian Pacific Railway.
Employees of the largest companies earn an annual average salary of $61,895, according to Association of American Railroad figures in 2003. The trade group said locomotive engineers earn an average of $75,162 annually while conductors earn an average $67,128. Locomotive and freight car maintenance workers typically earn $48,853.
Many would say those are pretty good wages, despite the challenging working conditions.
“It depends on who you talk to. Are we keeping up with inflation? I don’t think we are, but companies say labor costs are one of their biggest. But to me, that’s the cost of doing business,” said Bill Thompson, vice general chairman for the Brotherhood of Locomotive Engineers and Trainmen. The union represents about 800 workers in Pennsylvania, New Jersey, Maryland and Delaware.
Thompson said the rail industry has changed over the years. “You have less people doing the same amount of work. There used to be five or six workers on a train, now there are two,” he said.
Economy drives growth
A rebounding economy is the biggest factor driving growth. “If the economy isn’t producing, we can’t move it,” said White, of the Association of American Railroads. Burgeoning international trade and rising fuel prices also are factors.
“There’s no question the rail industry is hot. Just look at our numbers,” said Tim Wesley, spokesman for Wilmerding-based Wabtec Corp., a manufacturer of rail cars, locomotives and other rail products.
Revenue for the third quarter that ended Sept. 30 totaled $202.9 million, up from $167.2 million a year ago, a 21 percent increase. Wabtec, which employs about 350 workers in Southwestern Pennsylvania, is encouraged by the industry’s third-quarter freight car order rate of slightly more than 20,000 units, placing the backlog at just over 61,000 units — its highest level since 1998.
Wabtec said it expects sales this year to be about $900 million. It expects to release fourth-quarter and year-ending results next week.
A major contributor to the increases in rail traffic is so-called intermodal freight traffic. Intermodal goods are shipped in containers and trailers that can travel on trains, trucks or ships. For the full-year 2004, intermodal loadings were up 10 percent from the previous year, according to Association of American Railroad statistics.
The rail association says the successful intermodal partnership among the rail, trucking and shipping industries combines the best abilities of the transportation modes. “We compete against and cooperate with trucks and barges. A buyer wants to get from Point A to Point B at an acceptable price,” says the AAR’s White.
Shipping gives a boost
Intermodal shipping is the reason the Westmoreland Logistics Park transloading facility near Mt. Pleasant was opened in August by the Westmoreland County Industrial Development Corp. The facility employs six workers. Commodities shipped include lumber, plastic resins, roll paper, recycled glass and chemicals.
“If a business doesn’t have rail siding, they can have their railcar sent here and ship it by truck. We’re still young, but our volume is meeting expectations on our startup curve,” said Paul Turina, chief technical officer and principal of Safe Handling Inc., the Auburn, Maine-based company that operates the terminal. He declined to identify customers.
The Westmoreland Logistics Park uses a small railroad company, Southwest Pennsylvania Railroad, to connect shippers with CSX at Connellsville, the Norfolk-Southern at Greensburg and with the Canadian National Railroad, in Everson, Fayette County.
Southwest Pennsylvania Railroad is a short line railroad, a classification given to any railroad with less than 100 miles of main line track.
With the current spike in fuel costs, rail shipping is positioned well, according to the AAR’s White.
“We’re three times as fuel-efficient than trucks. We can move a ton of freight three times as far as a truck can on one gallon of diesel fuel,” said White. Statistics show that in 1980, U.S. railroads moved a ton of freight an average of 235 miles per gallon of fuel. In 2003, the comparable figure was 405 miles, a 72 percent increase.