How to Articulate the ROI of Employment Transportation

Author: Andrew Carpenter

Published: November 1, 2018

A major concern for mobility managers is how they can demonstrate the value of their programs and their potential return on investment (ROI)  to funders. Of course, because every community and program are unique, it is next to impossible to create a one-size-fits-all template for mobility managers to adopt.

With that in mind, NCMM has been researching promising methods for mobility managers to define the value of mobility funding. Building from that point, NCMM is exploring how mobility managers can articulate the value of their programs as returns on investments for the entities – states, foundations, businesses – that support community mobility programs. During this process, an article on Streetsblog USA caught our attention:

A study from the University of Wisconsin-Milwaukee of two employment-focused bus routes, nicknamed the “Jobsline” routes, between Milwaukee and Waukesha County, Wisconsin, articulated how critical these lines are for employees reaching job centers from the poorest parts of the city. The findings draw one of the clearest lines we have seen between investment in a service for a particular purpose – jobs – and the value it generates.

With funding of $11.4 million over four years, or $2.85 million per year, the Jobsline routes provide a combined 1000 trips per day, almost entirely for Milwaukee residents to reach work outside the city. From here, there is an easy-to-understand angle to explore the value that this state investment provides:

 

Gross wages influenced by routes

In the case of the Jobsline study, 87 percent of riders who responded to the study said the routes were “extremely important to them for maintaining their job.” Therefore, considering a median wage of $10 per hour, one could calculate the wages generated by a service that plays an extremely important role in earning that money. This is based off of the routes providing 1000 rides per day, and therefore 500 unique passengers taking two trips each (inbound and outbound).

500 riders/day x 87% find Jobslines extremely important x $10/hour median wage x 8 hours/day x 250 days worked yearly = $8.7 million in gross wages.

To account for the fact that some of those 435 riders – 87 percent who find Jobslines extremely important – could find other means of reaching their jobs, even if the bus provided the best option, it’s possible to drill down. 42 percent of respondents said they would have to quit their jobs if the Jobsline routes shut down. Extrapolating to the routes’ whole ridership, this represents 210 people losing work, representing approximately $4.2 million per year.

210 employees x 8 hours/day x $10/hour x 250 days = $4.2 million/year in potentially lost gross wages.

In this case, Wisconsin quickly generates a significant return on its investment in terms of gross wages generated by providing transportation. The taxes the state would collect from employees and employers would further amplify the routes’ effect.

 

Bringing this into your community

While not all examples of ROI are so clear cut, Milwaukee’s Jobsline routes provide an example of how mobility managers can articulate the return on investment for their programs by attributing a dollar value to the clients they or their programs serve.

One of the best ways to do this is to create a comprehensive survey, and to interview the clients that rely on mobility managers’ services. By asking questions that reveal mobility managers’ influence on whether or not clients address their needs, and then discerning the financial impact of this access on the client. From here, mobility managers can begin to draw a picture of the return on investment their programs have generated.

Want to dig deeper? Visit our page on measuring the value of mobility management, or contact NCMM staff to explore how you can articulate mobility management’s value in your community.

 

Image Credit: Milwaukee 148, Wikipedia, CC BY-SA 4.0

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Have more mobility news that we should be reading and sharing? Let us know! Reach out to Andrew Carpenter (carpenter@ctaa.org).