Building Bicycle Infrastructure Creates Jobs, Studies Find

While the economy remains in the doldrums and job growth continues to stutter, the bicycle industry, at least, seems to have recovered from the woes of the recession. The National Bicycle Dealers Association details that in 2010, bicycle sales were up 15% over the previous year, bolstering the industry to $6 billion in annual sales.

This positive development is complemented by further bicycle-related good news reported in Fast Company, regarding  the job creation effects of competing infrastructure projects. Recent studies show projects for building bicycle and pedestrian routes create more jobs than road building, indicating a nice synergy exists; provide more cycling facilities for a growing population of cyclists and stimulate some job growth into the bargain.

One of the key studies referenced was by the Political Economy Research Institute of the University of Massachusetts, entitled “Pedestrian and Bicycle Infrastructure – A National Study of Employment Impacts” and was released in June 2011. The main points and findings of the study are as follows.

The study looked at 58 projects from 11 cities nationwide and compiled information on completed building projects ranging from bike lanes, sidewalks, multi-use paths, other bicycle and pedestrian improvements, as well as construction and resurfacing of roads that did not include bicycle or pedestrian components. Detailed costs were obtained for each of these projects and then an input-output model (derived primarily from U.S. Bureau of Economic Analysis data), was run to determine the employment effects for each one.  The model categorized and accounted for employment in three distinct buckets;

  • Direct jobs: Engineering and construction jobs involved in the projects
  • Indirect jobs: Supply chain jobs in support of the direct jobs, such as cement manufacturing, sign manufacturing trucking and haulage, and
  • Induced jobs: Jobs derived from workers in the first two categories spending their earnings, and creating demand, in industries such as food services and retail.

Crunching the numbers, the study found the number of jobs per $1 million spent were.

All projects together                                     9 jobs
Bicycle specific projects                             11.4 jobs
Mixed pedestrian/bicycle projects        9.9 jobs
Road-only projects                                      7.8 jobs

Note, these figures represent jobs created within the state in which a given project was undertaken. The numbers also represent the averages, while the study found variances between states and between individual projects. Such variances were caused by three main drivers; labor intensity between projects, leakages (money and jobs created due to out-of-state spending), and wage differences.

Bicycle specific projects showed the best level of job creation because they tended to be more labor intensive (compared with road building’s more capital intensive bias), along with more limited leakage towards out-of-state spending. 

The leakage issue is important, actually. It leads to an underestimation of any given project’s total job creation value, because any value to states outside of the project’s host state, is not included. If you include the value of ‘leaked’ out-of-state spending, you get an additional 3 jobs. Marginal job creation due to leakage is, of course, a net benefit to the country, so it would seem federal funding on such infrastructure would be money well spent.

Of course, congress is currently embroiled in a deficit reduction wrangle (or more accurately, deadlock), so finding money for bicycle infrastructure spending would perhaps seem a tall order. However, this excellent article in Bicycle Times offers signs of hope. It turns out federal funding already exists for such programs, and is funneled into three main areas;

  • Transportation enhancements – funds for community-based projects to offer alternative travel choices
  • Safe Routes to School – money ear-marked to make walking and cycling to school more safe and appealing
  • Recreational Trails Program – which is self explanatory!

The good news is, all it takes is a commitment to maintain funding for these, not an ‘ask’ for additional funding. Bicycle Times goes on to say there are competing bills on the table which will set aside between $230 billion and $556 billion over six years via the Surface Transportation Bill. Furthermore, bicycle and pedestrian facilities take up only 1.5% of transportation infrastructure spending, while those modes account for 8% of all trips. So, they provide a disproportionately positive effect on reducing roadway use.

Once again, its nice to find the business case for a more sustainable transportation future, and especially when a job creation argument can be made. In closing, I’ll reiterate the ways Bicycle Times suggests advocates for bikes can make a difference and ensure the interests of cyclists are properly represented.

Phil Covington holds an MBA in Sustainable Management from Presidio Graduate School. In the past, he spent 16 years in the freight transportation and logistics industry. Today, Phil's writing focuses on transportation, forestry, technology and matters of sustainability in business.

One response

  1. I was showing a visiting friend this fab news ezine and wow here is this article that supports our new company WalkNBike! As a former CBS News investigative reporter and a certified personal fitness trainer I knew that what has been reported in this article would finally be brought to light! Bicycling is not only healthy for your body but also for a lagging economy. That is why I am helping my community of Avondale Estates, GA become a a Gold city by the League of American Bicyclists. KUDOS and give us more of these articles! Yes, I signed the pledge!

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