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How do traffic slowdowns and congestion affect the economy?

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How do traffic slowdowns and congestion affect the economy?
WATCH: Hopefully you arrived home from work on time today, but if you didn't, you wouldn't be alone. The nicer weather means lots of roadwork across Canada, and whether at the end of the day or on the way to work, it can be aggravating. Nathaniel Dove looks at what the slowdowns are costing the country. – Jun 7, 2024

There are two seasons in Canada, according to an old joke: winter and construction.

A new study this week looked at how summer slowdowns can affect productivity in Canada’s largest city. The numbers were huge — and a researcher says the issues apply to other major cities.

“The major construction going on on roads like the Gardiner Expressway obviously does disrupt commerce and it disrupts commuting,” University of Toronto professor Eric Miller said.

Toronto may be a “particularly severe case” because it hasn’t kept up with the infrastructure the growing city needs, but Miller said it’s a generic problem other major Canadian cities face.

Click to play video: 'Traffic chaos in Metro Vancouver after driver critically injured by debris through windshield'
Traffic chaos in Metro Vancouver after driver critically injured by debris through windshield

“The cost of travel is about valued by people about $20 an hour. So every hour of extra delay is $20,” he told Global News.

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The Gardiner Expressway, a major artery in downtown Toronto, is undergoing three years of construction. A report from transportation analytics firm Geotab ITS on Thursday suggested the lane restrictions from that work caused travel times to increase 250 per cent in the morning rush hour – meaning it takes up to two and a half times longer to get to work, “and 230 per cent in the afternoon rush hour.”

Traffic hot spots on the Gardiner Expressway are shown in this undated infographic. Geotab. CNW Group/Geotab Inc. and Geotab ITS

It comes after earlier this year, the Toronto Region Board of Trade warned the region is on the brink.

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“There’s a tipping point, and we’ve arrived at it, where people are so frustrated and it’s really starting to inhibit economic activity, business activity in the Toronto region,” Giles Gherson, president and CEO of the Toronto Region Board of Trade, told Global News in February after announcing a new traffic task force.

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The Toronto Congestion Task Force, a City of Toronto group, pegged the annual productivity losses at more than $11 billion.

Before the pandemic, estimates in other cities pegged the projected costs of traffic congestion between $500 million and $1.2 billion a year for Metro Vancouver, according to the C.D. Howe Institute in 2015, to an overall U.S. trucking industry impact of $94.6 billion in 2023.

The Canadian Automobile Association pegged the cost of lost work hours from traffic congestion at $45 million for Montreal in 2021 and roughly double that for Toronto that year. Infrastructure fund CDPQ pegged the broader cost that year to Montreal, including costs like delivery delays, at roughly $4 billion.

Mike Branch, data and analytics vice-president for Geotab, said he “wasn’t totally surprised because I’ve been through that traffic.”

But seeing the impact measured, he said, was “pretty staggering.”

Branch said the company had GPS devices in around 10,000 commercial vehicles, from small cars to large trucks, that used speed, fuel consumption, “even windshield wiper activation in the vehicle” to gather the data.

The cost largely falls on the delayed commuting worker, not the employer, he added, saying it can also affect productivity because the driver may be more stressed once they finally arrive.

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He clarified it’s hard to calculate an exact benefit-cost analysis of roadwork – other than knowing “it’s a big number.”

But, anecdotally, he said his son and daughter-in-law “live in the west end of town. We’re in the east end of town. They’re less likely to come visit us because it’s just too much of an effort to get across town right now.”

Overall, Miller said roadwork was a “necessary evil,” because without maintained streets, traffic and the economy would grind to a halt.

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