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The New Zealand Railways Magazine, Volume 2, Issue 5 (September 1, 1927)

[section]

When we use the word “railroad” we usually refer merely to the physical plant; but a railroad actually consists of both a plant and a personnel. These two parts of a railroad are complementary and interdependent to such a degree that there is hardly an important problem of management the solution of which does not involve changes affecting both of them. The physical property and personnel constantly react upon and determine each other.

It is my belief, based upon what I take to be incontrovertible evidence, that in the long run on the railroads and in every other largescale industry it never has been and never will be the owners of capital and the managers of industry, but that it always has been and always will be those who work for wages, who have got and will get the great bulk of all the tangible and intangible benefits resulting from every increase in the output of industry per man hour of labour employed and paid for, and that, therefore, it is the employee and not the employer who should be the more anxious to see efficiency in every branch of production increased by every means possible.

The best available measures of the physical capacity of the railroads are the tractive power of their locomotives and the tonnage capacity of their freight cars. Total locomotive tractive power per employee in 1906 was 817 pounds, and in 1926 it was 1,445 pounds, an increase of 77 per cent. Total freight car capacity per employee in 1906 was thirty-nine tons, and in 1926 it was fifty-nine tons, an increase of 51 per cent. It may reasonably be assumed that these increases are typical of increases in capacity that were made in all parts of the railway plant; and they were accomplished, of course, by the investment of capital. The average investment per employee in 1906 was $8,088, and in 1926 it was $12,991, an increase of 61 per cent.