Monthly focus: The economic impact of public transport

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Cities are the powerhouses of the economy, concentrating 80% of world economic output and more than 50% of the world’s inhabitants. Whilst the social advantages of public transport are well known, the economic benefits, particularly for cities, are less well documented. 

Efficient mobility in cities creates economic opportunities, enables trade, facilitates access to markets and services and makes efficient use of resources. As public transport forms the backbone of any efficient urban mobility system, adequate public transport provision helps make cities more dynamic and competitive as well as create more jobs.

Public transport is a major contributor to both national and local city economies through the diverse range of skilled, high-tech jobs that it offers directly. Public transport operators alone employ some 7.3 million people worldwide with authorities accounting for another 300,000 internationally. In many European cities, such as Brussels, Amsterdam, Barcelona and Paris, public transport operators are in fact the largest city employers.        

Capital investment in public transport sparks a chain reaction in economic activity up to three of four times the initial investment, enabling and promoting urban densification and greater urban productivity. Investments such as these can also provide up to twice as many local jobs compared to investment in other areas, such as roads, due to their complexity  and thus the variety of competencies required. 

Such projects can also help to act as a catalyst for wider urban development, helping to attract businesses and private investment to cities. While large-scale public transport investment projects are undoubtedly expensive, they are actually significantly less expensive than the direct cost of congestion, which can seriously harm the cities’ competitiveness, affecting travel time reliability and business productivity.

Public transport networks and infrastructure also play an essential role in the ‘global appeal’ of a city, as cities that are easy to move about in are consequently more appealing to businesses and tourists alike.

This month at UITP we will be shining a spotlight on the economic benefits of public transport, and illustrating that when public transport schemes are integrated into economic development strategies, urban development and housing policies, education and employment strategies, as well as tourism, cities are able to truly flourish. 

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