New-York tribune., 1919-01-24
Rail Earnings
Decline Under
U. S. Operation
Report Shows $7l3, 900, 600
for 1918 Is $25O,OOO,O 900
Less Than for Year 1917
Further Losses in Sight
Wage Burden ExpectedTo Be
Heavier, Business Lighter
Due to Postwar Situation

WASHINGTON, Jan. 23.-Railroads
in 1918 under government control and
unusual war conditions earned about
$4,000, 900, or S25O,O0O0 600 less than in
! 1917, S370,OO0, 900 less than in the record
year of 1916, and about the same as in
1915
This became apparent to-day on the
basis of definite reports to the Inter-
state Commerce Commission of earn
ings of 1876 principal railroads, those
having annual operating revenues of
more than 81 100000, for eleven months
and unofficial calculation of December
earnings, which the Railroad Admin
stration reports indicate will be con-
sderably smaller than those Of the
preceding months. Although subject to
slight revision, the lgures afforded the
first public view Of the results of rail
way operations last year, so far as
earnings are concerned.
Receipts from freight. passenger, ex-
press and other transportation during
tthe year amounted to approximately
$4,873 ,000 900, or $S32 100000 more than
in the previous year. Operating eX-
or about 1,119,000,000 more than in the
preceding year.
Freight Fell OFF in December
Preliminary reports to the railroad
administration indicate that freight
traffic fell off in December, with the
virtual stopping of great food ship
cessation of the hauling of other war
material, while expenses could not be
reduced materially This condition
sent the net earnings, or railway op
Grating income, which has been de-
olining steadily since the record month
Of last July, to probably S25,000,000 or
30,000,000, officials believe. This may
be compared to income of $50, 100000
in December of 1917, when billiards.
and curtailment of traffic sent earnings
to what was then considered very
low record.
The outstanding features of the
railway earnings situation last year
were that freight and passenger rates
were increased to yield about S9OO,OOO,-
o0e annually, or 450,000,000 in the six
months during which they were effec-
tive, while wage advances added $685.
100000 to operating expenses. These
are the latest estimates of railroad ad-
minlstratlon accountants, but are not
considered final. Wages particularly
may prove to amount to more than is
now believed.
Large Increase in Payroll
The railroad administration account
ants now report that in 1918 the ST.
71O,000,0O0 payroll of the year previous
was increased 81 per cent and that con-
sequently 100000 was paid out
last year to the 1000 900 railway en-
fective for only the latter part of the
year, and if these run through the pres
ent year, even without other additions
which may come from action on pend
ing applications for more pay, they
would make 1884, 100000 additional
wages. The wage level at the end of
1918 was a little more than 45 per cent
higher than at the beginning of the
year, when the government assumed
control.
Prospects for Improvement of the
earnings situation this year depend
mainly on whether business during the
readjustment period continues active
and gives a large volume of freight
traffic to the railroads.
Reduced Traffic in Sight
Indications point to a reduction of
traffic, and consequently to reduced
earnings, according to the railroad ad-
mnistration
Director General Hines has stated
that no consideration was being given
to any rate increase, but he believes
no general reductions can be made this
year.
These facts bear only an indirect re-
lation to the governments deficit, esti-
mated at $196,000,0O0. This represents
the difference between the net income
received by the railroads and the ag-
gregate, calculated at little less than
$500, 100000, which the government
guarantees the roads for the year
Neither does this take into consd-
Grafton the expenditures Of about $685.
100000 last year for capital purposes.
to make permanent Improvements and
buy cars and locomotives.