Australasian Railway Association (ARA) research has confirmed the rail industry’s contribution is growing across Australia.
The Value of Rail 2025 report was released in December 2025, confirming the industry generates $38.8 billion for the economy – an increase of 30 per cent over the past five years.
The number of jobs generated by the industry also rose to almost 200,000, up 14 per cent from five years ago.
The report confirms the growing role the rail industry is playing in Australia to support a productive, efficient and sustainable transport network.
Rail investment driving growth
The rail industry has seen rising levels of rail infrastructure investment in the past five years, as governments have recognised the importance of rail as a key part of our transport networks.
Investment in passenger networks has been a feature, with a range of major projects across the country well underway or nearing completion.
The opening of the Sydney Metro and the Metro Tunnel in Melbourne, as well as the delivery of Western Australia’s METRONET, are just a few examples of this significant investment.
The report found rail’s share of the value of infrastructure work surged from about four per cent in 2015 to 12 per cent in 2024 – effectively tripling its economic footprint – as projects like these were delivered.
This trend demonstrates how targeted investment and construction in the rail industry have been increasingly central to Australia’s long-term economic prosperity and makes the case for a sustainable investment pipeline in the future.
This provides a timely insight as we prepare to enter a new phase of the investment cycle.
Passenger rail rebounding after Covid-19
The report found passenger rail has rebounded after COVID-19, with 627 million train journeys and 227 million light rail journeys in 2023-24.
Sydney and Melbourne are our main public transport hubs, accounting for 83.2 per cent of all passenger journeys in Australia.
However, the purpose of rail travel has shifted – with fewer journeys as part of the work commute and more social and recreational journeys.
The rail industry has responded to meet this changing demand, delivering a range of customer service enhancements to support greater use of rail for a wider range of trip purposes.
Network expansion has also had an impact, with Sydney recording the highest growth in patronage in 2023-24, at 26.8 per cent compared to the previous year. This was in part due to the delivery of the new Sydney Metro project, making rail a more convenient choice for more people.
This growth prefaces what we can expect to see in other states as major projects are delivered, making it easier and more convenient for people to make rail their mode of choice.
The rail freight task is growing, driven by bulk commodities
Rail has met 71 per cent of the growth in freight demand since 2014, demonstrating the essential role the industry plays to support Australia’s economy and supply chain.
Rail is now responsible for moving five times more freight than road.
However, much of this growth has been in the transport of bulk commodities such as iron ore and coal, with bulk freight accounting for 90 per cent of all freight moved on rail.
Containerised freight has not seen the same growth, with systemic challenges facing the sector.
The ARA outlined these challenges in its Future of Freight Report and is advocating for policy reforms to improve rail freight productivity, efficiency and competitiveness.
While the completion of Inland Rail represents an important opportunity to achieve greater use of rail, further investment in rail freight will be needed to ensure Australia can make the best use of all freight modes across the national network, and deliver a sustainable national freight network that meets current and future needs.
Promoting mode shift to drive sustainable outcomes
The report confirms that rail remains critical to our net zero future, generating significantly reduced emissions compared to road.
Passenger rail generates 40 per cent less carbon pollution compared to road transport, while rail freight is 16 times less carbon intensive than road.
In addition, rail generates less particulate matter – or PM10 emissions – minimising air pollution. In fact, rail freight generates 90 per cent less PM10 compared to road.
With transport set to become Australia’s largest source of emissions by 2030 if no action is taken, achieving mode shift is more urgent than ever.
This will require a fundamental shift in how we plan and deliver infrastructure across the country, and continued investment in rail infrastructure to expand access to rail and support more efficient, resilient and convenient passenger and freight services.
Maximising the value of rail
The Value of Rail 2025 highlights the significant and wide-ranging benefits rail delivers to the economy and the community. In 2026, the ARA will be focused on four key issues to ensure Australia can continue to maximise the value rail has to offer:
Securing a sustainable investment pipeline to ensure the rail industry can continue to meet Australia’s needs as our population grows.
Achieving mode shift to promote greater use of both passenger and freight rail services.
Improving productivity to maximise the benefits rail delivers.
Supporting the transport sector’s journey to net zero, with rail playing a leading role in the transition.
We look forward to advocating for the industry on these issues to further build the value of rail in the future.
