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Norfolk Southern lays off 17 workers

Norfolk Southern is furloughing 17 mechanical employees at the Juniata Locomotive Shop.

The company informed the employees Friday.

“(It) is part of overall plans to align our operations with the current economy,” company spokesman Jeff DeGraff said in an email.

The furlough comprises 10 carmen, six boilermakers and one laborer, according to a shop employee who asked that his name not be used.

The company had planned to lay off the workers to offset a reduction in rail traffic due to the collapse of the coal industry and the effects of COVID-19 on the economy, said State Rep. Lou Schmitt, R-Altoona, who learned of the plans last month.

COVID-19 led the firm “to align our assets and resources with demand and generate sustainable margin improvement,” said company CEO James Squires in a news release on last year’s third quarter performance.

“I’m sure (the company) would say they’re always evaluating and right-sizing the workforce,” Schmitt said.

The company’s Precision Scheduled Railroading strategy, which aims at efficiency and which has enabled it to function with fewer locomotives, is also a factor, according to the shop employee.

Precision Scheduled Railroading has “significantly enhanced Norfolk Southern’s operational and financial performance and delivered superior returns for shareholders,” Squires stated in the news release.

The adjusted operating ratio — expenses as a percentage of revenue — was 62.5% in the third quarter, while the target is 60%, which the firm is “confident” it can achieve, according to the news release.

“Furlough decisions are always particularly difficult,” DeGraff wrote. “NS appreciates the hard work and commitment of all the men and women on the Thoroughbred Team and will continue our strong presence in this area.”

“We will work with furloughed employees that may have the opportunity to apply for positions, as available, elsewhere on the NS system,” DeGraff stated.

“It’s a good thing that their skill sets are in demand,” Schmitt said. Still, “it’s terrible for the families,” said Schmitt, whose father and grandfather were railroaders.

Schmitt said he hates the “mindset” that drives strategies like Precision Scheduled Railroading.

“I think these companies have become much more beholden to Wall Street than they have to Main Street,” he said. “Profits over people.”

Companies that want to “squeeze every last penny for some dividend” forget that it’s the workers who generate the profits, he said.

Mirror Staff Writer William Kibler is at 814-949-7038.

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