According to a new Association of American Railroads (AAR) report, the U.S. freight rail industry generated $233.4 billion in total economic output in 2023. The report highlights freight rail’s vital role in supporting jobs, fueling trade, and keeping supply chains moving efficiently across the country.
Freight rail directly employed more than 153,000 workers last year, with those jobs supporting another 596,000 jobs in related industries. The industry supported nearly 750,000 jobs, delivering $66 billion in household income and contributing $25.1 billion in tax revenue.
The report also demonstrates freight rail’s role in global trade, noting that 38% of rail traffic is tied directly to imports and exports. This connection helps keep transportation costs lower for American businesses while ensuring efficient movement of goods between ports, factories, and distribution hubs.
“Freight railroads are the backbone of America’s supply chain and a powerful driver of economic growth,” AAR President and CEO Ian Jefferies said in the release. “From supporting high-paying jobs to enabling trade and investing billions of dollars into the rail network, railroads play an essential role in keeping the economy strong.”
In 2023, rail companies invested $26.8 billion in their infrastructure, covering track maintenance, technology upgrades, equipment purchases, and safety enhancements. This private investment model reduces the burden on taxpayers, a point the AAR frequently emphasizes when advocating for pro-rail policies.
The economic impact is particularly strong in states with major rail hubs, including Texas, Illinois, Nebraska, California, and Georgia, where thousands of rail jobs support manufacturing, agriculture, and energy supply chains.
In addition to the economic benefits, freight rail offers significant environmental and public advantages. Trains are up to four times more fuel-efficient than trucks, reducing greenhouse gas emissions while also easing highway congestion.
With ongoing investments and its central role in supply chains, the freight rail industry is expected to remain a critical player in U.S. logistics for years to come.