Cities

The Outlook for Public Transit Isn't All That Bad

The ridership decline is confined to buses. That's no reason to cut overall funding.

Down, but not out.

Photographer: Kurt Wittman/UIG via Getty Images

For a century, Americans have loved their cars, and the freedom that goes with them. But although it’s often neglected and scorned, public transit has always played a crucial role in sustaining American cities. Now, those cities have to decide whether to keep investing in transit, or to wind down bus and train lines in anticipation of an even more car-centric future.

My Bloomberg View colleague Tyler Cowen is pessimistic about transit’s future in the U.S. Citing a Washington Post article about declining transit usage, he concludes:

I know, I know — if only we would spend more money, do it better, and so on.  An alternative and really quite simple hypothesis is that mass transit is largely a 20th century technology, it is being slowly abandoned, and in the United States at least its future is dim.

This is a crucial question for many cities. Transit is an expensive investment that doesn’t pay off for decades. If no one rides it, a city can be left holding a huge liability.

Looking at the data, it certainly does seem that transit has hit a slow patch. Total ridership is down from its peak in 2014:

Getting There and Back

Total ridership on public transportation

Source: American Public Transportation Association

Several factors are to blame. The first is the economic recovery that has picked up steam in the years since 2009:

All Better

Employment-population ratio, 25-54 years

Source: Federal Reserve Bank of St. Louis

Cars are a luxury -- people who make more money, and who feel wealthier and more optimistic about their prospects, are more likely to drive than take the bus.

A second factor is lower gas prices, which have made driving a lot cheaper:

Less Pain at the Pump

Average price per gallon of regular gasoline

Source: American Automobile Association via Bloomberg

A third reason is the advent of on-demand ride services like Uber and Lyft, which have grown rapidly in the U.S. since 2013. For wealthier commuters, these are often an attractive alternative to the stress of driving or the inconvenience of public transportation.

But if we look closer at transit trends, we see that there are several things going on at once -- it’s not a simple case of declining ridership. For example, both commuter rail and light rail ridership are at all-time highs:

Riding the Rails

Ridership on light and commuter rail systems

Source: American Public Transportation Association

One reason for this could be that Uber and Lyft are not good substitutes for commuter rail -- the cost of taking two 45-minute-long Uber rides every day is prohibitive for all but the richest Americans.

Meanwhile, heavy rail, which includes most subways, is down only slightly since its peak in 2015, after years of strong gains:

I Hear My Train a Comin'

Ridership on heavy rail systems, including subways

Source: American Public Transportation Association

This is probably about development patterns. Dense cities like New York are hellish to drive in, and if you take a taxi or Uber, you’ll could be sitting in stop-and-go traffic for a long time. On the subway, you can read a book, play a video game, people-watch or doze off, while your trip will cost much less than a cab ride.

The decline in U.S. transit comes almost entirely from buses. Bus ridership has fallen by more than a million riders a year since its peak in 2006, but even that peak was barely above the level in 1990:

Waitin' for the Bus All Day

Ridership on bus systems

Source: American Public Transportation Association

That buses are the main source of the transit decline is good news for cities’ pocketbooks. Since buses use the same roads as cars, when people switch from the former to the latter it doesn’t cause cities to take a huge financial hit (though it does increase road congestion).

There seems to be every reason to expect the decline in bus ridership to continue. Improved hydraulic fracturing technology and price competition from batteries will keep the price of fuel cheap. And even if Uber and Lyft remain niche services, the advent of self-driving electric cars will make personal transport even more attractive relative to buses. That doesn’t mean cities shouldn’t invest in bus lines -- the relatively low overhead of bus fleets means that if a particular city thinks local bus demand is going to grow, it can plan for that demand without taking too much risk.

The real question is about trains. Self-driving cars may eventually offer an attractive alternative to commuter rail, since people will be able to work, play and relax during a car commute instead of enduring the stress of driving and parking or paying high fees to a cab service. High-quality videoconferencing technologies will eventually allow more people to dispense with their commutes entirely. Investments in commuter rail are thus probably riskier than in the past, though fully autonomous cars are still years away and telecommuting may always be a niche activity.

But as for heavy and light rail -- short-range trains that take people from place to place within a city instead of ferrying them from the suburbs -- their future entirely depends on the way cities choose to develop. If cities create dense urban cores like New York City’s, cars are highly unlikely to replace trains. People who want to go shopping, go out to eat or meet their friends in dense cities are always going to find it more convenient to take a train, due to the simple geometrical fact that trains can move a lot more people than cars for a given volume of space.

Most U.S. cities are currently low-density sprawls, and most will probably continue to be so. But if a few decide to build dense, New York-style cores, trains will still be a good bet.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

    To contact the author of this story:
    Noah Smith at nsmith150@bloomberg.net

    To contact the editor responsible for this story:
    James Greiff at jgreiff@bloomberg.net

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