Working for Lionel was Very Lucrative, for Execs anyway

What will a little over $120k per year (in today's dollars) buy in NY/NJ?  IMO, that's not a lot of money for someone who came up with so many of Lionel's best ideas. 

I lived in Jersey for 68 years and did quite well with less.

Also, taxes were less back then.

@CSXJOE posted:

Came across Frank Pettits's employment offer in a Project Roar book.  $625 a month in 1944 plus royalties.  That's  $10,379 in today's money.  No wonder the trains were so expensive.

I suppose administration, inventory, materials, labor, tooling, machinery, facilities and utilities were all free...

Even in 1944 those costs were part of model trains.

Rusty

Having worked in heavy manufacturing for 45 years, the largest percentage of product cost is labor, both direct, (factory operators) and indirect ,(0ffice, engineering, sales, management). Since the Lionel plant was built in 1920 or so it would seem all the equipment was fully amortized and depreciated by then along with the building. Overhead (utilities, non-production supplies, insurance, etc.)  Is a small percentage of overall costs.

As an aside, in the late 50's and early 60's I lived within a long walk to the Hillside factory.

@CSXJOE, a few of questions:

1.  Who was Frank Pettits?

2.  Why do you care what he made 70+ years ago?

3.  Have you ever owned a manufacturing business with 50+ employees or been an officer or Board member of one?

-I also worked in heavy industry for almost 40 years.  Although it's true that labor costs are typically at least 50% of total operating costs, I think it's incorrect to assume that Lionel's equipment/overhead costs for a facility that was 20+ years old were insignificant.   During WWII, they converted from manufacturing toy trains to making products to support the war effort.   After the war, they completely changed their product line from tinplate to postwar.  I'm sure that this required substantial re-tooling, capital, and depreciation costs.

-I have no idea who Frank Pettits is, and nobody is saying that $120K/year (in today's dollars) is peanuts, but for an executive salary in the NY/NJ area, his salary doesn't seem at all exorbitant (as a matter of fact, it seems a little low).    If Mr. Petitts  (whoever he was) had an impact on Lionel's postwar success, then he deserved every penny.  Also, I don't think that Joshua Cohen was ever accused of overpaying his employees.  

-During covid, I got back into the hobby which meant that I took a bunch of stuff out of boxes that had been sitting in an attic for 55+ years.  It all still worked.   Lionel was never a low cost supplier, but there's a lot to be said for building something that will run for decades.  Producing products that will last for generations isn't cheap.

Really surprising that some O-gauge folks haven't heard of him - he was one of the inventive geniuses at Lionel and had a huge impact on our hobby.  I was surprised that searching on his name didn't turn up more info (there's no Wikipedia entry), but here are a couple of links:

https://www.poconorecord.com/s...h-ideas/51090002007/

https://www.goodreads.com/book...it-comes-from-within

Another observation regarding his compensation... Remember that in his time, his wife probably didn't have paid employment, so his earnings entirely supported the family; while a family can live on $120k today, they certainly aren't rich.

It didn't turn up because his name didn't have a "S" in it.

https://www.amazon.com/Comes-W...-Story/dp/0965029131

Jon

In today's money for an engineer that isn't all that much (obviously depends on where you work and what kind of tech field you are in). 120k for an experienced engineer would be low in a lot of tech spaces these days, kids coming out of college with an engineering degree is getting close to 100k in major markets (depends on the type of engineering and location). And in todays world that isn't an executive salary, guarantee you that, far from it. Petit also wasn't a routine employee, he developed a lot of the accessories and I would assume was also involved with the trains themselves, he wasn't a staff engineer. Back then a staff engineer would prob make like 80 a week roughly in the NY area.

Frank Pettit deserved every penny he earned, and then some. His creative mind sure provided many thousands of us with a whole lot of fun.

@Allan Miller posted:

Frank Pettit deserved every penny he earned, and then some. His creative mind sure provided many thousands of us with a whole lot of fun.

Agree totally. Not to mention that the way he designed things was a clever use of materials that were relatively inexpensive to implement, his designs probably increased Lionel's margins on each product quite a bit by clever use/re-use of technology across the product family.

Obviously money is a sensitive topic.  But I agree with those of you who say Frank Pettit was underpaid, if anything.  But wage disparities and wealth disparities were a lot less than today in the 1940s.

Wasn't there a farmer in New York state that invented a lot of things for lionel?

I wanna think it started with the milk car.  He gradually quit farming and lived off his royalties.

There's a book about Frank Pettit. (Oops. I see that Jon beat me to the punch on the book).

https://www.amazon.com/Comes-W...-Story/dp/0965029131

Note that Pettit received royalties from his inventions in addition to his salary. Those royalties probably constituted a healthy sum.