Actually, when I first heard that MacColl was talking about it as a song collected from railwaymen, I was surprised because I'd thought of it fairly exclusively as a shanty rather than a "land" song. But then again, I've been told that the "Railwaymen" of Crewe Alexandra Football Club (a town where traditionally the Railway was the primary source of employment) used to sing "Poor Paddy" as one of their terrace songs.

As for earlier sources on this song, Edward Keble Chatterton, in a 1923 book called The Mercantile Marine, quotes Liverpool shipowner Sir William B. Forwood:

"On the morning of the 20th November, 1857, I embarked by a tender from the Liverpool pierhead. It was nearly the top of high water. The crew were mustered on the forecastle, under the 1st Mate, Mr. Taylor. An order comes from the quarter-deck. ' Heave up the anchor and get away.' Aye, aye, sir.' 'Now then, my boys, man the windlass,' shouts the Mate, and to a merry chantie:
'In 1847 Paddy Murphy went to Heaven
To work on the railway, the railway, the railway,
Oh, poor Paddy works upon the railway'
'The anchor is away, sir,' shouts the Chief Officer. 'Heave it a-peak and cathead it,' comes from the quarter-deck, and the tug retriever forges ahead and tightens the tow-rope as we gather way. Bang, bang went the guns, and twice more, for we were carrying the mails, and good-bye to old Liverpool, and the crowds which lined the pierhead cheered, for the Red Jacket was already a famous ship, and it was hoped she would make a record passage."


(I used the above information on my Liverpool folk song a week blog, although I have a feeling that I first saw it unearthed by Gibb Sahib)