The U.S. railroad strike was temporarily averted when a “tentative deal” was struck between major freight rail operators and two major freight unions, the Brotherhood of Locomotive Engineers and Trainmen and SMART Transportation Division.
However, several other unions still have votes upcoming, and one, the International Association of Machinists and Aerospace Workers, voted to reject the proposal before renegotiating a temporary agreement.
The series of agreements and negotiations have thus far successfully averted massive disruptions in the transportation of 40% of goods across the United States.
While preventing the railroad strike was a considerable win for the U.S. economy and its ongoing supply chain issues, some have suggested that freight “railroads are [not] providing good service to their customers.” Railroads across the U.S. know and admit to the problems that persist within their industry.
The Association of American Railroads, the trade group for the industry, recently admitted that “Railroads understand that service is not at the level customers expect or deserve. Aggressive measures are underway to put the right plans, people, and equipment in place to improve service and reliability.”
One of the issues railroads face is staffing. A statement from four major railroads that “collectively handle 90% of the nation’s freight” recognized the issue with finding and hiring all the staff needed to make the railroads run smoothly and more efficiently.
Other issues the railroads face are delayed delivery times, poor service, and fewer trips. Vice President of the American Fuel & Petrochemical Manufacturers Rob Benedict stated that the agreement “shined a spotlight on how important the rail industry is to a lot of supply chains.”
“We’re happy they resolved the issue,” Benedict said, “but we’ve been shouting from the rooftops for the last five years how much the service has been declining.”
CEO of Renewable Fuels Association Geoff Cooper agreed. “It seems like things just keep getting worse,” he said.
Many U.S. industries rely heavily on the rail system. In an interview with CNN Business, chief economist and treasurer of the National Grain and Feed Association, Max Fisher, stated that “this has been the worst rail service year … spanning some 30 years or so.”
Pete Swan, professor of logistics and operations management at Penn State, told CNN Business, “Railroad management has been focused on maximizing payouts to the shareholders and their return on assets, not the quality of service.”
Railroad delays contributed to serious bottleneck issues at Los Angeles and Long Beach ports earlier this year. In September, “three times as many” as usual containers have at times been sitting on the dock, destined for the railroads.
Meanwhile, railroad workers remain dissatisfied with union decisions. Recently, Kansas City railroad machinists stated, “We have the right to strike, but that is being taken away from us by the union bureaucracy.”