These are good times to be working on the railroad.
Not so far back in 2016, BNSF Railway was battling lower coal shipping volumes by mothballing hundreds of locomotives and laying off workers. That year it furloughed roughly ten-percent of its workforce.
Lines of idled BNSF locomotives that were in storage on tracks in rail yards near Oklahoma City and Wichita, Kansas, were a visual reminder that 2016 car loads slumped down dramatically from 2015 levels.
Now, with carload volumes surging 10.6 percent year-over-year, BNSF is hiring and finds itself competing for workers in a tight labor market. As a result, BNSF is offering hiring bonuses of as much as $25,000.
Union Pacific is offering similar bonuses.
The railroads are hiring during a time of very low unemployment. Nationally, the rate is 4.1 percent, but in Nebraska, where BNSF is offering $20,000 for hiring of diesel mechanics and for railcar repair, the unemployment rate is only 2.8 percent.
The incentives come with a 3 year hold-down and are forfeited if the employee leaves the location or job for any reason.
Among the locations where BNSF is offering $25,000 for certain types of jobs include Chicago, Denver, Kansas City, Topeka, Denver, and Chicago.
“We are constantly evaluating the market and will use this approach when it makes sense to recruit talented individuals for hard to fill positions or locations,” BNSF spokeswoman Amy Casas was quoted in the Wall Street Journal.
© 2018 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.