Economic Benefits of Freight Policy Relating to Trucking Industry: Evaluation of Regional Transportation Plan Freight Policy for a Six-County Region, Chicago, Illinois

Abstract

The economic impact of freight transportation has been the focus of policy debate for many years. Attempts have been made to measure the benefits of freight policy. However, the overall economic impact, as reflected in increased output from efficiency improvements or generated employment, has not been evaluated effectively in long-range planning. This study attempts to quantify the economic benefits of freight policy relative to recommendations in the 2020 Regional Transportation Plan (RTP) for a six-county region of Chicago, Illinois. RTP projections for fuel consumption savings and shorter delays (and thus lower labor costs) were translated into output changes for the motor freight industry and, subsequently, demand changes. Using rather conservative assumptions, annual savings of $270 million were calculated as the total direct economic impact of RTP policy and project implementation on the regional motor freight and warehousing industry. Increases in output and demand for the motor freight industry were fed into an input–output model. The model found that direct, indirect, and induced impacts on the regional economy exceeded $675 million and generated nearly 7,000 jobs annually. In particular, both wholesale and retail markets were expected to increase output by almost $30 million because of freight movement efficiency improvements.