When people talk the power of CEOs, they generally mean over their businesses, their workforces, political lobbying, or the economy. It’s time to add traffic to the list.
That’s right: It might sound strange, or unrelated to business objectives, but CEOs could be the key to eliminating traffic jams.
When you think of transportation, you probably think about infrastructure: roads, bridges, and trains. But transportation options are only half of the equation for rush hour traffic. The other half is how people use those options, which is referred to by transportation-planner types as “transportation demand management” (TDM).
Business leaders have influence over this latter factor, and some are beginning to use it to encourage employees and customers to cut down on single-passenger car travel in favor of public transportation.
Some examples can seem unusual. Facebook, for instance, is offering $10,000 for workers to move closer—which would reduce the amount of time their cars spend on the road (and eliminate cars from some commutes altogether).
But TDM doesn’t have to be this extreme. For example, a chairman of the board could donate his parking space to bike parking, like Coke’s chair did in car-clogged Atlanta. That gesture seems minor, but small changes can set the tone for how a workplace prioritizes employees who don’t drive.
An office move can also do wonders. Only 4% of Panasonic employees took transit when the company was headquartered in a suburban office park. When it moved to downtown Newark, New Jersey, the combination of location and a robust TDM program boosted the transit rate to 57%.
Even more amazing, the Bill & Melinda Gates Foundation had a drive-alone employee rate of 88% in 2010, but within one year of introducing an internal TDM program —disincentivizing parking by charging at a daily rather than monthly rate and incentivizing carpooling and other ways to get to work—at a new downtown Seattle location, that number dropped to 42% and continues to decrease.
It doesn’t take a brain surgeon to learn how to ride the bus or bike to work, right? Perhaps not, but it does take some fundamental hand-holding. We have been trained for so long to take the car that we literally are at a loss as to how to handle the alternatives. Not to pick on Palo Alto in Silicon Valley, but even in California’s “smartest city,” a full 19% of those who wanted to ride the bus did not know how to ride it. Brain surgery or not, TDM is greatly needed.
Some cities, for this reason, have begun to invest in TDM. In Arlington, Virginia, for example, the county invests about $12 million each year in educating businesses, residents, and visitors about the strategy. The think tank where I work, Mobility Lab, estimates that this takes more than 40,000 single-occupancy car trips off the roads each workday, spreading those out into transit, biking, carpooling, and walking trips, as well as people working from home.
Part of the case programs like this one make for why CEOs should participate in TDM is that doing so is good for business.
First, it may help with recruiting efforts. An average 30-mile, drive-alone commute in the US costs a worker $16.50 per day, far more expensive than other ways to get to work, according to research by real-estate firm Avison Young (PDF).
The New York City Department of Transportation discovered in 2013 that establishing bike lanes on 8th and 9th Avenues in Manhattan increased local business retail sales up to 49 percent. A 2009 Toronto study found non-driving consumers had more money to spend on local businesses, and visited more often.
CEOs and small-business owners may not be seeing much happening in the way of a New Deal-type plan to rebuild our crumbling roads, bridges, and transit systems. But they can get smarter about the parking and the other space that they control outside their front doors. And they can incentivize healthy and sustainable transportation options for their workforce.
All of those efforts will lead to better business outcomes—and will kick a traffic jam or two to the curb in the process.
Paul Mackie is Director of Research and Communications at Mobility Lab.