The Impact Of Public Transit On The Workforce And Local Economies in the U.S. 

The Impact Of Public Transit On The Workforce And Local Economies in the U.S. 

Public transportation systems play a pivotal role in society that extends beyond just moving people from point A to point B. They provide essential mobility options to members of communities along with having a direct impact on energy consumption, air quality, and carbon emissions. Public transit shapes the economic landscape of many urban areas, boosting economic productivity by generating jobs and business opportunities that directly influence employment, wages, and business income. It’s estimated that public transportation systems in America currently transport around 34 million passengers every weekday, totaling over 10 billion trips being taken throughout the nation, annually. This provides a very distinct and unique opportunity for global leaders to take action in increasing investments in public transit – a notion that not only ensures economic return on investment but also helps accelerate our efforts of meeting sustainability goals along with creating equitable and resilient mobility networks that benefit everyone.  

According to APTA, failure to ensure adequate investment in public transit infrastructure could significantly impact the nation’s economy, resulting in accumulated losses of over $340 billion in business sales over the next decade alone. An additional decrease of $180 billion in gross national product (GNP) is also expected, equating to around 162,000 fewer jobs. In this article, we’re going to explore how public transportation contributes to the economic development of urban areas as well as its influence on job creation and what we can do to reinforce better practices and solutions that will help propel us toward a better future. 

Public Transportation Is A Driving Force Behind Economic Development

Public transportation enhances economic development by providing access to various societal locations such as employment, education, healthcare, entertainment venues, cultural institutions, and other essential amenities needed to sustain a quality of life. It’s a vital pillar of any community that ensures residents of urban areas can get to where they need to go, at an affordable price regardless of their income, social status, and ability to drive or own a vehicle. Public transport has been shown to contribute directly to 14 out of 17 of the United Nations’ Sustainable Development Goals (SDGs). Its ability to address global issues such as poverty, inequality, and climate change makes it one of the most effective tools that we have at our disposal when it comes to creating a positive impact on our urban environments, the world’s populations, promoting urban progress, and development while boosting the economy.

When a community has a well-developed public transportation system, it can attain new business opportunities, attracting tourists as well as residents who are seeking to relocate to areas with public transit, further promoting economic growth in a region. According to data provided by APTA, every $10 million in capital investment that is being shifted toward public transportation yields around $30 million in increased business sales. Public transit is essential when it comes to connecting workers to their place of employment along with helping residents gain access to job training programs, vocational schools, and any educational institution that will help them acquire the skills they need to compete in the workforce. By facilitating access to such resources, public transportation enables workforce development and promotes economic stability within a region.  

While public transit does help connect people to jobs, training, and leisure activities, it’s also shown to support tourism along with increasing land and property value, something that could aid in the revival of urban areas as well as poorer regions. According to APTA, home value has been shown to go up by 24% wherever there is a public transportation system in an area. Additionally, hotels with direct rail access to airports were also shown to experience an 11% increase in revenue per room than hotels in cities without public transit. The presence of public transportation is also essential for fighting inequality by providing mobility to low-income households or visitors of a city, ensuring that no one gets left behind. It’s estimated that nearly 45% of all Americans have no direct access to public transportation, a notion that only drives vehicle dependency further, with households in car-centric neighborhoods having to spend a lot of money to own and maintain several vehicles at a time, or finance other means of private transportation if they are left with no alternatives or choice.   

Investment In Public Transit Generates Jobs & Increases Accessibility

One of the most notable ways that public transit has been proven to support local businesses is by offering access to a wide range of employment opportunities. These benefits come in the form of increased productivity, job creation, improved accessibility, and a noticeable reduction in traffic congestion. By making sure that there are reliable transportation options, public transit can effectively enhance connectivity to employment that may not be easily accessible by car. Enhancing mobility through public transit means that everyone can get to where they need to go whether that’s a job position, a healthcare facility, an educational institution, or anything in general relating to social and recreational activities. This is especially important to people who don’t drive, low-income communities of color who are disproportionately affected, low-income residents, disabled people, young adults, and the elderly. It also means that residents of communities will have access to a wider variety of employment options whether that’s high-paying jobs or any type of essential employment position.  

There are some instances where public transportation can act as a barrier to employment opportunities and that’s not limited to just rural and suburban areas. The lack of affordable and reliable transportation in some cities could make it difficult for low-income families to access jobs, putting a great strain on household budgets. On the other hand, public transit in rural and suburban regions is often inefficient and poorly connected to broader transportation networks, meaning communities are left isolated from major highways, making it hard for residents to connect to job opportunities. Limited access to public transportation means these members of society have to rely on more expensive travel options, such as private taxis or ride-sharing services, to access jobs or connect to more employment opportunities. To address this challenge, city planners should expand existing mobility systems, build new public transportation infrastructure, and invest in alternative travel options, such as electric micromobility and bike-sharing programs.  

In addition to helping transit-dependent individuals access existing jobs, investing in public transportation has been proven to create jobs. By investing in public transit, communities can create around 49,700 jobs per $1 billion invested, generating a 5 to 1 economic return. A similar argument can be made in the case of road construction as it also generates jobs, however, public transport has a better track record of creating more net jobs when invested in. By simply re-directing our spending away from roads and highways and into public transit, we can generate around 20 percent more jobs without having to spend even a single dollar more. Furthermore, public transit enables the creation of employment opportunities for members of society who need it the most. By strategically placing a higher density of public transit systems in communities with high unemployment rates, authorities can generate up to 2.5 times more jobs than in instances where these services would be made available to communities with low unemployment. 

Public Transportation Enhances Productivity & Promotes Economic Stability 

Public Transportation helps workers retain jobs by offering reliable and affordable access to their place of employment. If people can get to work on time by using frequent transit services, they are far more likely to be productive and perform adequately in their positions. By enhancing job retention, communities can facilitate financial security for households, reduce costs for employers, and aid in maintaining a stable economy. Public transportation can also effectively reduce the costs of owning and maintaining a vehicle, such as maintenance expenses, fuel, and parking. This can be of crucial difference to residents who are taking on low-wage jobs or internships, acting as a stepping stone to higher-paying positions. It’s currently estimated that Americans pay an average of $12,182 per year to own and maintain a personal vehicle. The cost of using public transit is significantly lower as a typical transit pass costs around $50-$150 per month. The achieved savings can be redirected toward spending in other parts of the economy while investment in public transportation enhances the provision of essential services in urban areas and improves mobility. 

Projections by APTA suggest that travel and vehicle ownership cost savings could accumulate to over $11.7 billion annually if passengers switch over to using public transit instead of other modes such as driving, taxis, and on-demand transportation. Additional cost-savings of over $800 million are estimated from a reduction in traffic congestion, with a direct impact on automobile and truck drivers, along with various businesses and households. An increase in business productivity as a result of improved access to broader labor markets and workforce could deliver an additional $1.2 billion in savings, on an annual basis. When it comes to increased property values and tax base, it was concluded that the presence of public transportation in an area could effectively increase the value of property by up to 150 percent, which stimulates the local community’s tax base to reinforce the development and maintenance of essential public services such as schools, roads, and fire and emergency medical facilities. 

Why Low-cost, High-quality Transit Will Serve Cities Better Than Free Rides

Public transit systems across the U.S. face numerous challenges as they attempt to recover from pandemic ridership losses along with increasing pressure to keep rides affordable. Ridership onboard public transit has recovered to about 79% of pre-pandemic levels after experiencing a decline down to 20% from what it initially was before the pandemic. APTA reports that passengers took a total of 7.1 billion trips in 2023, illustrating an increase of 16% when compared to 2022, with ridership levels continuing to increase even though office occupancy rates remained stagnant. In cities such as Boston, Kansas City, and Washington, elected officials and advocates of fare-free public transit are voicing their position regarding removing fares from transit altogether. This poses yet another issue as current deficits in the sector are growing more apparent with over $176 billion in transit backlog, which is expected to grow to more than $270 billion by 2030. Failure to address the revenue shortfall in transit could significantly impact ridership levels resulting in further decline as possible service cuts could cause severe delays and issues with reliability.  

Inflation and driver shortages are also raising operating costs for transit agencies. Managers are allocating more funds toward public safety in response to rising transit crime rates in urban areas along with the growing issue of unhoused people who are using buses and trains for shelter. Furthermore, many transit systems in the U.S. are dealing with aging infrastructure, with the American Society of Civil Engineers rating public transit systems in the nation with a grade of D-minus, yet again underlining the urgent need for capital investment. Prolonged repairs and failure to execute required upgrades reduce service quality, leading to unfortunate events such as the 30-day emergency shutdown of a prominent subway line in Boston back in 2022. Some cities have directed their efforts toward targeted strategies that make public transit accessible to everyone. For instance, programs like “Fair Fare” in cities such as San Francisco, New York, and Boston are offering discounts based on resident’s income, while still collecting full fares from members of society who can afford to pay. 

Some transit providers are also considering or have already initiated the implementation of fare integration policies. In such cases, transfers between different transit modes and systems happen for free, meaning riders pay only once. Chicago stands as a good example of this, with its rapid transit or bus services allowing riders to make transfers at no additional charge, whether they need to catch a suburban bus to complete their trip or the other way around. A fare integration approach is considered to be more cost-effective than fare-free systems and riders who have low incomes stand to benefit as well. It would seem that history has shown us what works best when it comes to rebuilding public transit networks, and free transit isn’t very high on the list. There are current studies that show that transit riders would rather prefer low-cost services that deliver quality over free rides, with an emphasis on improved reliability and enhanced multimodality. According to a recent survey conducted by industry professionals, it was concluded that over 95% of the participants agreed that the most important incentives that city planners and transit providers should focus on are improving networks to have better accessibility and more frequent services if they want to boost ridership and increase economic gain. 

We Need To Shift Our Focus To Creating Strong Public Transportation Networks

Margaret Clouston, Chief Revenue Officer at Modeshift, shares her perspective on why we need to invest in public transportation as a way of promoting economic growth and how creating strong transit networks will help us do just that. “Investing in public transportation isn’t just about moving people; it’s about moving communities forward. Reliable transit systems provide the vital arteries for the flow of workers, goods, and ideas that fuel economic growth and opportunity.” She dives deeper into the subject, highlighting the capabilities of public transit regarding equity, social development, and expanding the local workforce. “A robust public transportation network acts like a social equalizer. It connects those on the margins of the job market to potential employment, expanding economic participation and creating a more inclusive and prosperous economy. Think of public transit as an enabler of potential. For businesses, it expands the talent pool; for individuals, it expands the map of opportunity. This dynamic duo ultimately benefits the entire community.” Margaret further indicates that cities with strong public transportation systems tend to attract a diverse and innovative workforce. Quality transit options contribute to the overall quality of life that makes a place desirable to live and work, a factor that companies increasingly prioritize. 

Government authorities should promote incentives that facilitate collaboration among private companies and transport providers in achieving multimodal integration across networks. The goal should be to connect riders with job opportunities by offering solutions to the existing mobility gaps in fixed-route networks and suburban job centers. This could help remove barriers relating to equity and inclusion in transit, making it an attractive and affordable option to riders that aids in first-mile/last-mile connections. The North American Bikeshare and Scootershare Association, published its State of the Industry Report 2022 which concluded that during the pandemic, 55 percent of micromobility operators collaborated with transit agencies to fill gaps caused by reductions in transit services and were successful in doing so. Integrating public transit with micromobility options and newly emerging modes such as minimobility is also set to grow in popularity among residents of urban and suburban areas, offering an affordable and environmentally-friendly alternative to cars.   

The increased usage of Bus Rapid Transit is also set to dramatically change the way Americans commute in the coming years. BTR systems offer a multitude of conveniences to users by facilitating fast access to transportation, with much higher travel speeds, safety in operations, and enhanced reliability when compared to standard bus services. The efficient nature of BRT is underlined by its time-saving capabilities as a result of transit vehicles using dedicated pathways, level-boarding, and off-board fare collection. By implementing BRT systems nationwide, municipalities can quickly build high-capacity networks, with high-quality public transport services that can easily be integrated with other transport modes, such as walking, cycling, and paratransit. 

Leveraging Technology To Improve Networks & Addressing The Workforce Shortage In Transit 

One way that transport providers can improve their networks as well as boost ridership is to redesign bus routes based on usage and demand so that they cater to the specific needs of communities. Agencies should be wise to leverage the benefits of cutting-edge technologies such as Artificial Intelligence (AI) and Machine Learning and apply them for data analysis, route optimization, and predictive maintenance. A data-driven approach to transit can greatly enhance an agency’s effectiveness when it comes to improving operational efficiency, decreasing travel time, and saving fuel and valuable resources. This will inevitably increase customer satisfaction by providing better transit experiences to riders. Technology can also aid agencies in improving energy efficiency by decreasing the consumption of fuel in everyday operations and reducing greenhouse gas emissions. When paired with newly deployed electric buses and alternative fuel sources, public transit can become truly sustainable, offering a viable alternative to private car use and ownership.  

Additionally, improving the working conditions for employees in transit should be a top priority for any transport provider. According to the APTA’s report on workforce shortage in transit, public transportation is experiencing a dramatic shortage of skilled workers, affecting its ability to provide adequate service to communities. The reason for this shortage is thought to be multifaceted, including various complexities that correlate to changes in the broader culture and economy. Some suggestions mentioned in the report revolve around improving the working conditions for transit staff, particularly when it comes to compensation, improving schedules, and increasing safety. APTA’s report goes into further detail about how to improve culture in the workplace as a way of hiring and retaining a new generation of operators by appealing to them with better competitive benefits packages and a clear path to career development.  

Technology in combination with other measures can serve as a powerful ally in helping agencies solve the issue of workforce shortage in transit. Transport providers are beginning to understand that by leveraging the many benefits of technology they can resolve many internal problems and issues relating to employees and daily operations. Smart technologies, in particular, can take a lot of the pressure off workers regarding certain administration and operational tasks, which could significantly improve flow, efficiency, schedules, and organization as a whole. For example, by investing in a contactless payment solution, agencies can reduce the need for drivers to validate and issue tickets, something that will not only increase safety for them as a result of less interaction with riders but will also improve their productivity and concentration. Boarding times will also be reduced as a result, as well as idling, ensuring smoother and more efficient services.  

In Conclusion 

As communities continue to grow and evolve, it will become crucial that government authorities recognize the need for increased investment in public transportation. This is one of the most effective actions global leaders can take when addressing urban issues such as traffic congestion, bad air quality, and inequality in transit. It will also aid in accelerating their efforts in the fight against climate change. The UN estimates that by 2050, 2 out of every 3 people will be likely to reside in cities or other urban centers, emphasizing the need for more sustainable urban planning, particularly when it comes to mobility and public services. By investing in reliable, accessible, and sustainable transportation options, we can move closer toward our goal of creating resilient communities that are adaptable and capable of meeting the evolving needs of its citizens, promoting better economic growth and an enhanced quality of life for everyone.