Headcount Levels Fall Nearly 12% In March At U.S. Class I Operations

The number of employees working for the U.S. operations of the Class I railroads dropped 11.9% in March to 127,867 employees, according to data from the Surface Transportation Board (STB).

The percentage change compares March 2020 with March 2019.

All employee categories experienced year-over-year declines. The steepest declines were for employees handling the maintenance of way and stores, which was down 16.7% to 22,062, and employees belonging to the train and engine category, which fell 16% to 51,801. The train and engine category tends to be more sensitive to changes in demand for rail service, while overall headcount has fallen in recent months as almost all the Class I railroads transitioned to some form of precision scheduled railroading, an operating model that seeks to streamline operations. 

But despite the year-over-year headcount dips, overall employment was flat-to-higher sequentially, and March's total was the highest headcount level among the first three months of 2020. Between February and March, overall headcount rose 0.18%. The train and engine category was also up by 0.68% from February as the railroads prepared to move more volumes as winter transitioned to spring.

That said, the COVID-19 pandemic could slow potential momentum towards any headcount gains. Weekly U.S. rail traffic has tumbled since late March, posting double-digit percentage declines, and rail volumes could contract even further in the second quarter as the nation weathers the pandemic. The Association of American Railroads, the American Short Line and Regional Railroad Association and the Transportation Trades Department of the AFL-CIO in late March applauded provisions in the stimulus package known as the CARES Act that addressed rail unemployment. 

While employment data submitted to the STB shows a slight uptick in March headcount sequentially, FreightWaves' SONAR, which uses data from the U.S. Bureau of Labor Statistics and encompasses rail employment beyond the Class I railroads to include passenger rail and other freight rail operations, shows the headcount decline extending through March.