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4/1/2026
The Surface Transportation Board yesterday announced a proposed change to how it calculates railroads' productivity, or how efficiently railroads move freight.
Each year the STB calculates the change, if any, in the rail industry’s productivity, or how efficiently railroads move freight. The board calculates this figure by comparing year-to-year the average cost of producing a unit of railroad output.
Yesterday, the board announced it's proposing to adopt 1.015 (1.5% per year) as the measure of average change in railroad productivity for the 2020-2024 period. The proposal represents an increase of 0.1% from the average for the 2019-2023 period, according to the STB's decision.
Comments on the STB's proposal are due April 15. Unless postponed, the decision is slated to take effect April 18.
Since 1989, the cost recovery procedures have required that the quarterly rail cost adjustment factor be adjusted for long-run changes in railroad productivity. This long-run measure of productivity is computed using a five-year moving geometric average.
The productivity change for the year 2024 is 1.014, based on changes in input and output levels from 2023, and represents a decrease of 2.5% from the rate of productivity growth in 2023 relative to 2022 (1.040), the board's decision states.
Incorporating the 2024 value with the values for the 2020-2023 period produces a geometric average productivity growth of 1.015 for the five-year period 2020-2024, or 1.5% per year. As the new geometric mean was computed by replacing the 2019 figure of 1.007 with the larger figure of 1.014 for 2024, there was an increase of 0.1% in the geometric mean from last year’s value.
To read the board's decision in its entirety, click here.