(The following story by Chuck Hackenmiller was published in the January 15 issue of the Ames Tribune.)
BOONE, Iowa — Administrative positions — rather than jobs in operating services — will take the brunt of employee cuts when the Union Pacific Railroad takes steps this year to cut company costs by 20 percent, a railroad spokesman said Tuesday.
“First of all, it’s not a 20 percent reduction in Union Pacific employees,” said John Bromley, a Union Pacific spokesman. “It’s a 20 percent reduction in total company costs.”
Bromley said he couldn’t say specifically if any of the future job cuts would affect the Boone operations center.
“But I can say that the bulk of the jobs cut will be on the administrative side rather than the operations side,” he said. “(The cuts) will affect more of the company’s headquarters and regional headquarters employees rather than at Boone.”
The Boone operations center is under the jurisdiction of the railroad’s Clinton regional office.
Union Pacific employs about 350 people in Boone’s operational service center, including about 141 engineers, 154 conductors and various managers and maintenance personnel.
“We need (those jobs) in Boone to keep the trains running,” Bromley said. “You won’t see as much of an impact in Boone.”
A Union Pacific employee in Boone who asked not to be identified said there have been no large-scale job cuts in Boone, but there have been some seasonal personnel changes the company normally has at this time.
Union Pacific, based in Omaha, had announced in December that it was drafting a plan to cut costs in a variety of areas by a total 20 percent. Steps will be taken throughout the year, and possibly beyond, to make those cuts.
“There’s no target date as to when there will be that reduction in expenditures of 20 percent,” Bromley said.
Bromley said Union Pacific, which experienced a “very good year” financially, had cost concerns “on the horizon.”
“One of them was the cost of health insurance benefits,” he said.
Some short-term concerns, he said, are the prospect of war against Iraq and the political crisis in Venezuela, both which could result in higher fuel prices.
“We’ve also found that since after the terrorist attacks of 9-11, we’ve also had rapidly rising insurance costs,” he said.
Bromley said the railroad is still on heightened security alert at various railroad properties, including at the Union Pacific (Kate Shelley) double-track high bridge near Boone which was strengthened last year. He couldn’t elaborate on the security issues.
“That isn’t a huge cost to the railroad, but it is additional expenses,” he said.
It was reported by the Omaha World-Herald that the first round of cuts came Monday, when 53 employees in the information technology department lost jobs and that more job cuts are anticipated in the department.