Despite billions of dollars in federal funds for new and expanded train service, Amtrak can't find the staff to simply recover from the pandemic.
Amtrak saw some 10 million travelers return to the rails in the U.S. last year. That was great news for the railroad that saw passenger numbers crater during the early days of the pandemic then slowly come back as people hesitantly returned to travel.
That surge in demand, which Amtrak Chief Financial Officer Tracie Winbigler described as “amazing” on Thursday, saw 22.9 million trips made on the railroad during the 2022 fiscal year that ended in September. Ridership was at about 85 percent of pre-pandemic levels by the end of the period, and continuing to recover.
But the return of travelers could have been better if it was not for one key thing: Train capacity. Amtrak operated only about 80 percent of its 2019 schedule during fiscal 2022, or about five points less than the recovery in passengers. And on the Northeast Corridor, the railroad’s busiest line that connects Boston, New York, and Washington, D.C., ridership was 10 percent above numbers three years ago despite there being fewer trains.
The result is a classic supply-and-demand imbalance: Higher fares for travelers. While Amtrak does not release average fare data, revenues were down just 15 percent from fiscal 2019 to $2.8 billion in fiscal 2022, which ended in September. That is also about five points better than the recovery in train service last year.
“2022 was about a capacity challenge,” Amtrak Board President Anthony Cosica said at a meeting of the railroad’s board on Thursday. He added that the biggest issue was the “level of staffing.”
Businesses across the U.S. economy have struggled to meet staffing needs as they have come out of capacity. Several airlines suffered operational meltdowns in the spring, including Alaska Airlines, Delta Air Lines, JetBlue Airways, and Southwest Airlines, that were largely attributed to staffing issues. The situation forced the carriers to pull back their schedules and, according to airline trade group Airlines for America (A4A), the industry operated roughly 15 percent less capacity over the peak summer travel season than it planned at the beginning of the year.
“Coming out of the pandemic, the workforce issue is a deep issue that has impacted a lot of businesses,” Cosica said. “We do have an issue to get the people, train the people” at Amtrak.
And Amtrak faces “acute challenges” restoring its workforce, particularly in certain key areas like machinists, CEO Stephen Gardner said Thursday. “We could not overcome the attrition rate,” he added, referring to the staff that voluntarily retired or left for other jobs during the pandemic. Roughly 90 percent of Amtrak staff who were involuntarily furloughed during the crisis have returned to their jobs.
The staffing situation is not expected to normalize in the current fiscal year, which ends in September 2023. Despite plans to hire more than 3,100 frontline staff — the railroad hired 3,700 people last year — Amtrak still anticipates operating slightly less capacity than it did four years ago. It forecasts roughly 28 million passenger trips this year, or 90 percent of 2019 levels.
Only in fiscal 2024 does Amtrak expect capacity to fully recover, and see ridership meet or exceed 2019 levels.
Amtrak continues to make strides, if slowly, on the Connect U.S. plan to expand rail service nationwide that it unveiled in 2021. The blueprint calls for new or expanded rail service to about 160 communities across the country that would be partially funded by the $66 billion allocated to passenger rail in President Biden’s Bipartisan Infrastructure Law.
“We’re entering a new rail for passenger rail in America, and Amtrak’s future could never be brighter,” Gardner said.
But getting trains running will take longer — probably much longer — than many hope. The Amtrak board outlined little concrete advancement on the Connect U.S. expansion plan during the meeting. Two corridors that did receive a mention, if only in passing, was the recent agreement with freight railroads to resume passenger rail service along the Gulf Coast from New Orleans to Mobile, Ala., and work with North Carolina and Virginia to reactivate the so-called “S-Line” corridor between Raleigh, N.C., and Richmond, Va., for passenger rail. No timeline was provided for either project.
Where the board did mention progress was on a number infrastructure upgrades to the Northeast Corridor. For example, the replacement of a bridge over the Susquehanna River in Maryland and the Connecticut River Bridge in the state of the same name were mentioned. Both projects, as well as numerous others already underway along the corridor, address the railroad’s long maintenance backlog and, when done, will allow for faster train service.
The lack of details on Connect U.S. progress was not a surprise. In late 2021, Gardner told a Congressional committee that, given the lead time many of these projects require, it would take around 18 months — or until mid-2023 — for work on many to begin in earnest.
In addition, on Thursday, Gardner said that Amtrak still needs state and local support for all of its capital projects even with the availability of federal funds. Money from the Bipartisan Infrastructure Law, for example, can only be used for 80 percent of the total cost of new passenger rail lines, for example.
“Amtrak is not a unitary actor,” he said. “We cannot tomorrow say ‘we want to stop here and issue an edict.’”
The railroad did open two service expansions in 2022, though both were started before the pandemic. In July, passenger trains returned to Burlington, Vt., for the first time in 70 years, and Amtrak inaugurated direct service to Pittsfield, Mass., in the Berkshires from New York City.
In another parallel with airlines, the availability of equipment — rail cars and engines in this case — is also limiting Amtrak’s recovery. New trains for its flagship Acela high-speed service on the Northeast Corridor are only expected to enter service in “late 2023,” as Gardner’s presentation indicated, or at least two years late. And new train sets — or both engines and cars — for the busy Northeast Regional service are also delayed at least two years to 2026.
“There is not an off-the-shelf product, in most cases, that is available,” Gardner said on Amtrak’s equipment supply issues. “We don’t have the domestic supply base.”
Compared to Europe, the U.S. rail market is “tiny,” he said. This creates numerous vendor and supply chain “challenges.”
Gardner pointed to new train cars from Siemens for Amtrak’s California and Midwest services as an example. Purchased by the states of California and Illinois, the railroad had planned to have about 60 of these trains in service today. However, due to delivery delays and other issues, only about 30 are operating.
Airlines are seeing similar challenges with the supply of new aircraft. At the Skift Aviation Forum in October, Air Lease Corp. Executive Chairman Steven Udvar-Hazy said that all of the aircraft lessor’s new planes were arriving late with some coming as much as six to seven months behind schedule. These issues at Airbus and Boeing have slowed the global recovery in airline capacity.
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Photo credit: Amtrak saw record ridership on the busy Northeast Corridor last year but staffing issues keep it from fully restoring pre-pandemic schedules. Amtrak