How Much Does Congestion Matter?

When Transportation Secretary Ray LaHood's
suggested that
bicyclists' needs should be accommodated in federally-funded road
projects, the
road lobby responded with something approaching hysteria. Bill Graves of
the
American Trucking Association wrote that a more pro-bicyclist policy
"would
cause an economic catastrophe" by "hinder[ing] the movement of our
nation's
goods."(1) The road lobby's logic seems to be (a) supporting bicycling
reduces
funding for roads, which (b) will lead to an increase to road
congestion, thus
(c) causing an economic catastrophe. 

In this blog post, I'd like to focus on element
(c) of that
chain of logic- the link between road congestion and economic growth.  Both auto and transit lobbies occasionally suggest (as did Graves) that
without more transportation funding, economic life as we know it will
end.

If this were true, the most congested regions
would be the
most economically stagnant ones, and the least congested regions would
be
booming. But this is hardly the case. 
According to the Texas Transportation Institute, the two large
regions
with the lowest per-capita travel delay are Buffalo
and Cleveland
(2)- hardly economic powerhouses.

To be a little more scientific, I took a look at
the
nation's fourteen largest regions, and tried to compare their congestion
and
job growth levels.

In order of congestion levels, they are: 1) Los
Angeles (70
hours lost to congestion per traveler), (2) Washington (62), (3) Atlanta
(57),
(4) Houston (56), (5) San Francisco (55), (6) Dallas (53), (7) Detroit
(52),
(8) Miami (47), (9) New York (44), (10) Phoenix (44), (11) Seattle (43),
(12)
Boston (43), (13) Chicago (41), and (14) Philadelphia (38).

If congestion was an extremely important factor
in job
growth, we would find that Boston, Chicago and Philadelphia
are booming, and that high-congestion regions like Los
Angeles, Washington and Houston were declining.

But in fact, there appears to be almost no
correlation
between congestion and recent job growth. 
 The 2000-09 job growth levels (3),
in order, for these regions were: (1) Houston + 11.3%, (2) Washington +
10.6%,
(3) Phoenix + 8.4%, (4) Dallas + 5.3%, (5) Miami + 4.9%, (6) Seattle +
2.5%,
(7) New York + 0.6%, (8) Atlanta -0.8%, (9) Philadelphia -1%, (10) Los
Angeles
-3%, (11) Boston -4.3%, (12) Chicago -5.5%, (13) San Francisco -10%,
(14)
Detroit -20.7%. 

As you might notice, the three least congested
regions all
suffered negative job growth between 2000 and 2009.   By
contrast, the two fastest-growing large metro areas, Houston and
Washington,
are also among the most congested.   On
the other hand, Los Angeles and Atlanta
experienced high congestion and negative job growth, while Phoenix
and Seattle had
relatively low congestion and moderately positive job growth. 

It could be argued that there is a lag between
congestion
and growth, as businesses move out of a city in response to congestion.  If this was true, prior congestion data would
show a much stronger relationship to job loss than the most recent data.
But in
1997, the congestion rankings were pretty similar to those of 2007.  (4) Then as now, Los
Angeles was the most congested of the major urban areas, followed
by Atlanta and Washington
(as well as Seattle, which tied with Washington for third
place).  Then as now, Philadelphia
was the least congested of the major cities; the least congested regions
after Philadelphia were Boston
and New York.   \

In sum, the correlation between congestion and
job growth is
pretty weak.  It logically follows that
even if the federal government reduces transportation spending, and even
if
such reductions do increase congestion, the overall economic effect of this
result
may be pretty small. 

Let me emphasize what I am not arguing: I am not
arguing
that congestion has no economic costs.  It makes sense to me that other factors being equal, businesses would
rather
locate in a place with less traffic rather than a place with more.   But I am arguing that congestion is one of
many, many factors affecting our economy, and that its alleviation
should be
balanced against other factors. 

To put the matter another way: the Texas
Transportation
Institute estimates that congestion cost the national economy $87 billion per year.(5)  Sounds pretty bad, doesn't it?  But
US GNP is about $14 trillion per year, so
the cost of traffic congestion is less than 1 percent of GNP. 

Ironically, traffic congestion is a bit like the accommodation of bicycles.  It seems to me that Americans' quality of life would be higher if they sat in traffic less.  It also seems to me that Americans' quality of life would be higher if they could bicycle more safely and conveniently.  But I doubt that the long-term success of the U.S. economy depends on getting either issue right. 

(1) http://transportation.nationaljournal.com/2010/03/should-bikes-and-cars-be-treat.php

(2) http://mobility.tamu.edu/ums/congestion_data/tables/national/table_1.pdf

(3) http://www.newgeography.com/content/001156-employment-growth-2000-2009-metropolitan-areas-over-2-million-population
 

(4) http://mobility.tamu.edu/ums/congestion_data/tables/national/all_nat_cong_tables.pdf
(Table 4)

(5) Id.,
Table 2.