The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1921-01-22
Railway Employees Must Expect
Wage Reduction Soon.
Editor of "RaiIway Age" De-
scribes Plight of U. s. Lines.
PAY ROLLS FAR TOO HEAVY
Even Maximum Business VIII
Not Stand the Drain.
Pay Roll Now s3,6OO,OOO,OOO
Was $685., 100000 in 1917.

New York, Jan. 22.-Railway wages
should and must be substantially re-
duced sooner or later, and steps to-
ward their reduction should be taken
in the very near future, Samuel o.
Damn, editor of the Railway Age, told
the New York Railroad club in an ad-
dress here last night.
Experience since the recent ad-
vances in rates were made have dem
onstrated, Mr.. Dunn commended, that
even with. a maximum traffic the rail-
ways cannot earn 6 per cent on the
valuation fixed by the interstate COM
merce commission with the present
passenger and freight rates and the
present wages. They are not now
handling a maximum business. Their
freight traffic has declined 80 per cent
since October and on January they
had a net surplus of $4,000 cars.
1.-The demonstrated inability of the
railways to earn the return expected
even when handling maximum traf-
fic," Mr.. Dunn said land the tremen-
dous decline of traffic are creating a
serious situation to which not only
railway managers. but the railroad la
bov board, the interstate commerce
commission and congress must give
early attention.
Earning Only 4 Per Cent.
"In September the railways earned
only 81 per cent of the expected net
return; in October only II per cent,
in November only So per cent. The
total net operating income they
should have earned for those three
months to have contributed their
share toward a 6 per cent annual re-
turn was $324,417,000, while the
amount actually earned was only
$219, 100000. At this rate they would
1T7IV
months of large business. The inter
state commerce commission has rec
ognized the principle that the rail-
ways must earn 6 per cent to enable
them TO expand their facilities suffi-
GENTLY to give the public adequate
service.
The public would strongly oppose
a further advance in rates under pres
ent conditions when prices of most
commodities, and especially of farm
products, are declining. The only al
Tentative is to reduce operating ex-
penses. The present very high oper-
ating expenses are chiefly due to the
normous pay roll. This enormous
pay roll is due to the granting of the
eight-hour day under government con-
troll, which has caused a large in
crease in the number of employees, and
to~the large advances in wages made
by the railroad administration and by
the railroad labor board last July.
Expenses Too High.
The operating expenses of the
railways are now running at the rate
of, about $3.50, 100000 a year, or
over $3,100,000,000 a year more than
in 1917. OF this increase in expenses
almost $4,000, 100000. or about two
thirds, is due to increases in the pay
roll, while most of the remainder is
due to increases in the costs of ma
terials and supplies.
No injustice would be done to rail-
way employees by reducing their wages
at this time. The advance of $780,
100000 a year given them last July
by the railroad labor board was grant
ed when the cost of living was the
highest ever known, being 104.50 per
cent more than in 1914. Since then
the cost of living has declined and is
estimated by the national industrial
conference board to be now only 80
per cent more than in 1914.
Wages Paid Double.
sThe present average annual wage
of railway employees for working eight
hours a day is 125 per cent greater
than it was in 1914 for working ten
hours a day. Under the national
agreements made by the governments
railroad administration with various
organizations. of railway employees,
many millions of dollars are being paid
annually for work that is not done In
1914 the railways had 100000 en-
ployes and paid them 1887, 000,0 900.