Transit has a net economic benefit

Decades of research show that transit positively impacts the economic health of our region through a broad range
of pathways.

Quantifying the economic impacts and benefits of transit

Decades of economic analysis have yielded a singular conclusive finding:

Investing in transit results in regional economic growth

The studies in Table 1 all calculate benefit-cost ratios for transit investments in urbanized areas. Benefit-cost ratios are a quantification of the economic returns that result from a financial investment. In all cases shown below, the benefit-cost ratio exceeds 1, meaning that $1 invested in transit yields more than $1 in economic benefits. Three Chicago-specific studies conducted over the past two decades all show significant benefits to the region if we were to invest in a state of good repair or expand service. Of all the studies we surveyed, the smallest expected return from investing in transit was 21%. This would be considered a hugely successful investment in the private sector.

Table 1: Transit yields a high return on investment

City or region Economic benefits generated Study
Chicago region $3.00+ Cambridge Systematics (1995
$1.21–1.62 Metropolis 2020 (2007)
$1.90 RTA, Moving Beyond Congestion (2007)
San Francisco (SFMTA) $2.00–2.90 EPS (2012)
Twin Cities $1.50–3.10 Itasca Project (2012)
State of Illinois $1.80 Godavarthy et al. (2014)
State of Wisconsin $3.41 HDR (2006)
US cities over 2.5m $1.34 Hartford (2006)
All US cities $2.79 Litman (2010)
Carbon reduction

Public transportation produces significantly lower greenhouse gas (GHGs) emissions per passenger mile than private vehicles.[10]

Buses' emissions are 33% lower than cars, and passenger trains are 76% lower.

Economic benefits to residents, employers and communities

Transit benefits the economic health of the greater Chicago region in a variety of ways.[1][2][3] When regions step up their transit investment and transit ridership increases, businesses, households and communities experience the following types of economic benefits:

When combining all providers together, public transit was the 10th largest employer in the Chicago region in 2017.

Let’s move it!

Healthy Chicago 2.0 identifies active transportation as a key solution for increasing overall regional health. Objectives include increasing those who bike, walk and take public transportation to work.[11]

Fewer Traffic Deaths

Analysis of National Highway Traffic Safety Administration and Federal Transit Administration data show that metro areas with higher public transportation use have lower traffic fatality rates.[12]

Success breeds success

Expanded investment yields more transit usage, while minimal investment depresses the number of riders. As municipalities and regions grapple with how to keep their transportation infrastructure functioning, policy makers face tough decisions about how and where to make investments. The following chart is a simplified framework of how different levels of investment impact ridership. If our region wants more people to use transit—a highly efficient, equitable and sustainable form of transportation—we need to invest in it.

Table 2: Tending to transit

Adapted from Tending to Transit, Chaddick Institute for Metropolitan Development, Schwieterman, et al. (2012)
Action → Impact → Outcome
Current system Expand and enhance system Improved service quality Increased transit usage
Maintain current operating status Maintained service quality Stable transit usage
Minimal operational investment Degraded service quality Decreased transit usage
  1. Transportation Research Board, Practices forEvaluating the Economic Impacts and Benefits of Transit, 2017.
  2. APTA Economic Impacts of Public Transportation Investment, 2014.
  3. Victoria Transport Policy Institute, EvaluatingPublic Transit Benefits and Costs, 2017.
  4. APTA, The Economic Cost of Failing to Modernize, 2018
  5. CTA.
  6. APTA. The Economic Cost of Failing to Modernize. 2018.
  7. RSG. Regional Transportation Authority 2016 Customer Satisfaction Study. 2016.
  8. Transportation Research Board, Practices for Evaluating the Economic Impacts and Benefits of Transit, 2017.
  9. Todd Litman. Victoria Public TransportationInstitute. Evaluating Public Transit Health Benefits
  10. Federal Transit Administration, Public Transportation’s Role in Responding to Climate Change, 2010
  11. Chicago Department of Public Health, Healthy Chicago 2.0, 2016-2020
  12. American Public Transit Association, August 2018

More ways transit benefits business