Need Economic Stimulus? Try Bikeshare.
Summary: Bikesharing is often considered only for its environmental benefits and congestion reduction, but data is beginning to reveal that it also provides an economic punch. The added bicycle infrastructure and increased bicycle traffic that accompanies bikeshare is shown to promote local commerce. Bicycles can access local stores more easily than their gasoline powered counterparts, and cyclists have more disposable income due to reduced automobile upkeep. Increased bicycle friendliness improves livability and quality of life, which attracts young entrepreneurs and provides an added edge for companies trying to recruit the best talent.
Bikesharing is often discussed in terms of being environmentally friendly and a “feel good” addition to communities, without much of a foundation in practical, quantifiable returns. However, data is beginning to show that the increase in bicycle infrastructure and ridership associated with bikeshare programs has a very direct, positive economic impact. In fact, data has shown such a strong connection between improved bicycle access and economic growth that there’s an emerging trend of Bicycle-Friendly Business Districts (BFBDs), where bicycles are integrated into a district’s operations, events and promotions (Emerging Trend: Bicycle-Friendly Business Districts). This economic stimulus occurs in several ways: (1) by diverting customers to local businesses; (2) leaving potential customers with more cash in their pockets; and (3) by providing incentives for young, tech-savvy employees to relocate to areas.
One of the best ways to improve local economies is to deliver paying customers. Bicycles are an ideal way to do this because they make it easy for commuters to make quick, frequent stops. Parking a bicycle is far easier than parking an automobile. In Manhattan, where a protected bicycle lane was added on 9th Avenue, “local businesses saw a 49% increase in retail sales. In comparison, local businesses throughout Manhattan only saw a 3% increase in retail sales” (How Bike Lanes can Boost the Economy). Increased bicycle usage in areas also has secondary effects by ensuring “a steady flow of people through a space even after dark, keeping ‘eyes on the street’ and making other constructive after-hours uses more likely,” extending peak business hours and increasing bicycle and pedestrian traffic (Project for Public Spaces | Three Reasons That Bikeshare Stations …). Respondents to a Capital Bikeshare study found that nearly two-thirds of respondents would not have made their trips without the bikeshare program because it was too far to walk, bringing in customers who would have otherwise stayed away (2011-2012 Capital Bikeshare Member Survey).
Getting people to places of business is important, but it’s also vital that they arrive with disposable cash in their pocket, and few transit modes can compete with bikeshare on cost. In Minnesota, users of the city’s Nice Ride bikeshare system spent, on average, an extra $1.29 per week because of the program. Extrapolating this out to the entire population of Nice Ride subscribers would generate an additional $150,000 over the season, and the system continues to grow in popularity (Catalyst July 2012: Nice Ride spurs spending near stations). A study by Alison Lee at the University of Melbourne found that cycling generates 3.6 times more expenditure than driving. Car users spent, on average, more per hour than bicyclists, but the small area of public space required for bike parking suggests that each square meter allocated to bike parking generates $31 per hour, compared to $6 generated for each square meter of automobile parking space (economic contribution of cyclists compared). Capital Bikeshare riders were found to save an average of $15.75 per week on personal transportation costs. Across the estimated 18,000 Capital Bikeshare members back in 2011, this is a collective savings of $15 million (2011-2012 Capital Bikeshare Member Survey). Money that would be spent on automobile ownership is now being spent on local businesses. Erik Kugler, the owner of Bicycle Space has noticed an increase in local spending as a direct result of Capital Bikeshare, noting “money becomes available for the local economy. You see new restaurants open up, cafes, niche shops, and small businesses like ours. We employ 18 people here” (D.C.’s Bikeshare Program a Boon to Local Stores).
Economic progress is also accelerated by attracting high quality, well-educated talent, and improved bicycle access has been shown to drive young, well qualified professionals to an area. Good biking opportunities are important to tech-savvy 25-35 year olds, who represent the “creative class” sought by high-tech firms and startups. Recently, “thirty-three executives at New York high-tech companies—including Foursquare, Meetup and Tumblr—urged Mayor Michael Bloomberg last year to ‘support a bikeshare system as a way to attract and retain the investment and talent for New York City to remain competitive in the fast growing digital media and internet-oriented economy’” (Bikes Boost Economic Opportunities in Your Town). This drive for talent growth is seen elsewhere as well. Eric Matthews, CEO of new business initiative Launch Memphis, he notes, ‘Biking correlates with entrepreneurs.’” Dr. Steven Bares, President of the Memphis Bioworks Foundation, an initiative to bring emerging health companies to Memphis agrees, feeling that “the bike is part of the overall strategy to compete for talent.” In Chicago, Mayor Rahm Emanuel explained, ”One of the things that employees look at today is the quality of life and quality of transportation because of the ease that comes with it” (Bikes Boost Economic Opportunities in Your Town). And the importance of improved bicycle infrastructure and ridership is an issue gaining favor not just on the liberal side of the political spectrum, but on the conservative side as well. Indianapolis’ republican mayor Greg Ballard recently spoke about improving the city’s bike culture in an interview saying, “it’s about talent attraction and business attraction, and you need to know the trends that are coming forward now. So when you look at what young people are looking for, when you look at businesses who want to hire those people, you have to create that kind of city, and that’s really what we’re trying to do” (A Conversation With Greg Ballard).
Bikeshare remains in its infancy, with many programs still gaining traction. The full economic potential has yet to be realized. City planners and decision makers can draw a clearer picture as more data becomes available, but initial findings show a lot of promise. What’s easy to understand already is that bikesharing has the potential to change how cities function. Bikeshare can drive better bicycle infrastructure that makes bicycling appealing for everyone, benefiting personal bicyclists and bikeshare riders alike. Doing so also fosters a sense of community and an investment in the local economy. The low cost of bikeshare programs compared to other mass transit solutions, combined with its potential for economic improvement, make bikeshare hard to ignore in today’s economic climate.
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