Walking is economic growth

You know walking is good for your physical health, and even your emotional wellbeing. But did you know it’s critical for the fiscal health of your city too?

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In honour of Vancouver’s Italian Day, three crosswalks on Commercial Drive were painted with the colours of Italy’s flag.

June 11, 2019

By Tristan Cleveland

In 2018, Minneapolis set a global precedent for designing happy cities. Its city council voted, almost unanimously, in favour of changing its zoning codes to allow retail stores to open along major transit routes.

In doing so, the Minnesotan city created opportunities for many more people to walk to do things they need, like buying bread or getting a haircut. This was a big move for urban wellbeing: walking supports health, builds social connections, reduces stress and contributes to happiness.

But achieving these social goals is just the beginning. Making a whole city more walkable will also support enormous economic growth. Economists and policy wonks hardly ever mention walking as a strategy for economic development. I’m going to explain why they should.

Note: We’re using the term “walk” as a catch-all for all ways people get around, including wheelchairs, walkers, and rollerblades. To achieve equitable economic benefits, everyone needs to be able to get to the things they need safely and comfortably.

Walking is good for the economy

Let’s start with a thought experiment. Imagine if homes didn’t have bathrooms, and everyone had to drive every time they needed the loo. Congestion would be horrendous, and so too would be the wasted gas and time. Bathroom-free homes wouldn’t just be inconvenient: they would needlessly slow the economy.

Of course, no one in a wealthy city would build a home without a bathroom because the inconvenience is too obvious. And yet residents of roughly three quarters of homes built today can’t get coffee, bread, a haircut, cash, or a newspaper on foot. When we build communities where people can’t get the things they need in a quick walk, we are wasting everyone’s time and money.

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Having to drive to buy bread is economically inefficient, like having to drive to use the washroom. Graphic credit: Tristan Cleveland*

The fundamental logic of walkability

The efficiency of an economy depends on the costs of each transaction. When we buy something, there are two costs involved: putting products on store shelves and getting people to them. Economists tend to focus on the former, by considering the efficiency of ships, trains, and trucks. But the everyday journeys taken by billions of customers matters just as much, or more.

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The efficiency of every in-person goods transaction depends on two parts: how much it costs to get the product to the store, and how much it costs to get the customer there. Walking to access goods supports economic growth because it costs almost nothing, to the walker or society. Graphic credit: Tristan Cleveland

Walking is direct evidence of economic productivity

It’s no coincidence that downtowns and main streets tend to be simultaneously the most walkable and the most economically productive parts of cities.

That’s because economic productivity and walking both depend on doing more in less time and cost. Few people walk to any destination that is more than five to 10 minutes away. If lots of people are walking, that suggests they can do lots of things in little time.

So the walkable neighbourhood isn’t just a personal time saver: it makes the whole local economy more productive. That’s one reason why more walkable cities have a higher average GDP.

Forcing people to use a 4,000 pound vehicle for buying bread imposes enormous avoidable costs on individuals and society.

Consider the costs of driving to individuals:

  • Fuel, parking, insurance, lease payments, repairs. According to AAA, cars incur about $9,000 of expenses per year to their owners in the United States, many of which depend on how much a person drives.
  • Time looking for parking. In New York, drivers spend on average 15 minutes looking for a spot, costing each driver about $2,243 per year.
  • Traffic accidents. By one estimate, car accidents are the second biggest cost to users after ownership, and more than the cost of gas or parking.
  • Congestion. In a major city like Toronto, drivers quickly consume all available road space and slow traffic daily, costing the city’s economy $6 billion per year.

… And the costs to society:

  • Inefficient use of space. The space required to park two cars at home and work is the same size as a small retail store. These cars only get used 5% of the time.
  • Infrastructure costs. A single underground structured parking spot costs $34,000 to build. Each drive adds wear and tear to roads, requiring cities to spend as much as $16,000 per year on road maintenance per kilometre, and such estimates often fail to account for full long-term road replacement costs.
  • Cost of goods. About 73% of the retail price of gas and 86% of the retail price of a new car immediately leave the local economy.
  • Foregone trips. Toronto loses an estimated $1.5 to $5 billion worth of economic activity every year because heavy traffic discourages people from leaving home.

Compared to the high cost of driving, walking is a steal.

Economic jet fuel

People in the United States bought over 80 billion things, in person, in 2016. If people could make a few billion more transactions with a quick walk instead of driving, not only would they save money, but GDP would grow faster and impose fewer costs (like carbon emissions and noise) on society.

Walking, however, does more for economic growth than reduce costs. When people are more physically active, they become smarter and more productive at their jobs. Kids who get exercise perform better in school.

The Brookings Institute notes that walkable places are critical for supporting business innovation. That’s because walking creates chance encounters, helping people to build networks and to share ideas. A large majority of new venture capital funding in the United States now goes to downtowns and walkable suburban communities. Car-dependent hubs of innovation, like Silicon Valley, are the exception rather than the rule.

Walking is economic equity

Not everyone has the privilege of choosing where to live. Housing prices are sky high in many walkable places, pushing low-income people to car-dominated urban fringes that make walking hell.

So we need to ensure low-income people have more access to walkable places. When walking is a good option, it reduces the cost of living and improves rates of employment, which leads to higher upward mobility.

Minneapolis has addressed this challenge. Allowing more shops to crop up across the city means more neighbourhoods will become walkable, increasing the housing supply in walkable places. To provide equitable access to these homes, the city has allowed lower-cost forms of housing, like triplexes, to be built everywhere. It has also invested heavily in social housing.

Take it from Minneapolis: A happy city is an efficient city

Minneapolis Mayor Jacob Frey has said of the 2040 plan: “we are gearing toward having a beautiful urban dynamic on the street, where you walk down the block with a thousand different tastes and smells and sounds and people. These are aspects that make a city wonderful and exciting.”

He’s right. And those are also the aspects that generate efficient economic growth.

Cities around the world should follow Minneapolis’s lead. For planners, politicians and economists, walkability is a power tool that builds happiness, social equity and economic growth at the same time.

What else can cities do to nurture both walkability, economic growth and social inclusion? Who else is getting it right? We’d love to hear ideas from your own city. Tweet at us, or share your thoughts with info@happycities.com.

*Additional credits: Car by yanti anis from the Noun Project. Bread by SlideGenius from the Noun Project.

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