Why Mobility Matters
By Ted Balaker

The following was adapted from the Reason policy brief Why Mobility Matters, which is available online: reason.org/pb43_whymobilitymatters.pdf

A vast metropolis has the potential to draw on the effort and talent of millions of people, but if mobility fades, the dynamism of the city fades with it. The city becomes less of a grand metropolis and more of a collection of hamlets—hamlets whose residents are increasingly isolated from each other.

When mobility fades, employers are also hurt. The drag of congestion slows all kinds of businesses. Consider businesses that deliver things, from pizza to parcels. They are forced to pay workers for their unproductive time (when they’re stuck in traffic) and forced to pay extra for gas and maintenance. Congestion slows businesses and decreases the number of customers they can serve. And because congestion is unpredictable, delivery schedules also grow more erratic. Because of traffic congestion a Fort Lauderdale-area cement company discovered that it could no longer make reliable deliveries to construction sites during the week. The company was forced to make Saturday deliveries and incur the extra expense of overtime pay. Often companies try to pass the cost of congestion on to customers and this makes many things, from food to furniture, more expensive than necessary.

Congestion’s impact is felt by everyone from plumbers and landscapers to salespeople and realtors. Throughout the day these people try to reach as many customers as they can, but congestion stands in their way.

Businesses are only as good as the people who work for them and congestion often makes it difficult for employers to find the right person for the job. From financial companies to high-tech firms, employers need people with specialized skills, and as labor pools shrink, so do their chances of finding the best employees. In San Diego, some high-tech employers regard the infamous I-5/I-805 bottleneck as the end of their labor pool, as they are unwilling to hire those who live north of the interchange.

Congestion was once a background concern, but now it is moving to the foreground. According to recent surveys, congestion is residents’ top concern in places like Austin, Atlanta, Portland, Minneapolis-St. Paul, Sacramento, San Diego, and San Francisco. Members of the U.S. Chamber of Commerce rank it among their top concerns and in certain areas the problem is particularly acute. A recent survey asked Silicon Valley CEOs about their most daunting business challenges. In the span of a single year, congestion moved from the number nine challenge to number two. Degraded mobility now joins high housing costs, taxes, and regulations as a reason why companies leave or avoid certain cities (see Box).

Congestion prompted Dell to expand in Nashville instead of its home base, Austin. “We lost 10,000 jobs in one day,” recalls a local official. That incident sobered up leaders to the importance of mobility. Since then Texas has embarked on the nation’s most ambition congestion-reduction plan and recently those efforts were rewarded.

After considering many locations, Samsung decided to bring a multi-billion dollar chip manufacturing plant and 900 jobs to Austin. Transportation was one of the major reasons behind the choice. Initially, the congestion on I-35 made Samsung was wary of Austin because silicon wafers from the new plant would be trucked to Dallas before being sent by plane to South Korea for final processing. Congestion can cause costly delays, but local officials’ new commitment to mobility assuaged Samsung’s concerns.

Embracing Mobility

Congestion saps cities of their vitality, but improving mobility helps invigorate urban economies. Researchers Rémy Proud’homme and Chang-Woo Lee analyzed employment dynamics in 22 French cities. They discovered that when mobility increased—when people were able to increase the area they could reach in a fixed amount of time—the economy expanded. A 10 percent increase in average travel speeds was associated with a 15 percent expansion of the labor market and a 3 percent increase in productivity. Jobseekers were able to find better jobs, and employers had access to more workers and more customers.

A U.S. analysis took a similar approach and discovered similar results. The National Cooperative Highway Research Program study examined the economies of Philadelphia and Chicago and assumed a 10 percent increase in travel speeds. The researchers estimate that each year this improvement in mobility would save Philadelphia businesses $440 million and Chicago businesses $1.3 billion. The French and American studies reveal another important point—a little mobility improvement goes a long way. Remember each analysis examines the effects of a 10 percent increase in speed. In Chicago that’s the equivalent of bumping travel speeds from 33 to 36 miles per hour. If such relatively modest mobility improvements offer such hearty benefits, imagine what even greater progress might yield.

It is time to reassert the importance of mobility. Embracing the mobile society will improve life for individuals, for cities, and for our nation.

Reason Foundation’s Ted Balaker is co-author (with Sam Staley) of The Road More Traveled: Why the Congestion Crisis Matters More Than You Think, And What We Can Do About It (Rowman & Littlefield 2006).

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