Planning	FHWA > HEP > Planning > Econ Dev
< Previous	Contents	Next >

5.0 Conclusions (as of Fall 2002)

5.1 Localized Impact Findings

In the analysis framework (Section 2.3), it was noted that economic impacts of highways can unfold over a period of many years, starting with initial interest in new development of land which is followed by new construction and business siting before any increases in employment and business sales are actually measured. This study utilized surveys of county and local officials in the Southern Tier West region (and a comparison region) to collect information on the extent to which the new interstate highway has led to further changes in land development, new construction and business siting patterns. The results of that survey process confirmed that the new interstate highway has indeed led to an increase in land development and business siting, though it has now been only two years since completion of the interstate highway and many of those changes are just now emerging.

The changes be characterized as follows:

Interest in land development leads to new land use plans and raises land values - These changes are clearly occurring within the first two years following completion of the interstate highway. New expressions of interest in land development led five communities to develop new land use regulations or adopt previously proposed regulations. At least three communities noted increases in property values that they attributed to the new interstate highway.
Construction of new buildings and opening of new businesses - These changes are already emerging, with initial construction and siting of new businesses underway and others proposed within the first two years following completion of the interstate highway. New manufacturing plants came into five communities, with new warehouse distribution centers in two others.
Increase in Visitor Services and Visitor Spending - These changes are in an earlier stage of emerging. There is already evidence of new investment in additional facilities and attractions for visitors, although data on actual changes in visitation and visitor spending is not yet available. Facilities include new truck stops in two communities, new motels in three communities (and proposed for others), a new visitor information kiosk in one community and a new Indian casino also opening up. However, only one community could confirm an actual increase in visitor spending to date.

5.2 Area-wide Impact Findings

In the analysis framework (Section 2.3), it was noted that increases in employment and income occur from new business openings and business expansions, which follows after local investment in land development and building construction. In other words, a time lag in observing employment and income increases is to be expected. A review of past studies of highway economic impacts have also confirmed that a ten year time lag is not unusual. [4]

In this case, it was found that there was also a time lag in the availability of measurement data. At the time of the analysis, detailed countywide employment and wage data was only available up to 2000, the year that the new interstate highway was completed. (At the time of publishing this report, data to 2001 is now available, which still represents just the first year after completion of the highway.) Clearly, this preliminary data is too premature to draw conclusions about the post-completion impacts, although it can be used to draw conclusions about employment trends occurring before and as the highway was being completed. It can thus be viewed as an indicator of initial economic changes occurring in anticipation of the highway project completion.

The available data on employment and income trends can be characterized as follows:

Measurement of overall countywide employment and income trends indicate that the study area's economy has continued to perform slightly better than that of the comparison area during the period before and during completion of the interstate highway. The difference -- occurring before the route was officially designated as an interstate highway -- was modest: 1.3% employment growth vs. 0.1% employment growth. This data should be viewed as most useful for establishing baseline trends and very early changes occurring in anticipation of the new highway completion. Several more years of post-completion time is needed to make any real conclusions regarding post-completion changes in the regional economy of the study area.
Measurement of industry-specific employment trends indicate that the manufacturing sector was the only identified element of the study area's economy that clearly grew faster than its counterparts in the comparison area and elsewhere in the state. This appears to be consistent with observations that a series of new manufacturing and distribution facilities moved into the region around the time of completion of the interstate highway. However, further observation in subsequent years is needed to confirm that this is a continuing trend and impact of the highway.

It will take at least three more years of hard economic data to observe the extent of any net increases in employment and income that are attributable to business openings only now occurring. To accurately assess long-term impacts on economic growth, up to ten years of economic data will be necessary. However, the very early data reported here can be viewed as consistent with the more detailed and up-to-date reports by local officials (as summarized in section 5.1).

5.3 Uses of this Study

This report has two primary uses.

Research - This report has stand-alone value as an indicator of early, emerging impacts of the new interstate highway, and contributes to our understanding of initial highway impacts. It will take more years for long-term impacts to be observed and analyzed. From that viewpoint, this report has further value as a source of baseline information for subsequent follow-up studies. Ultimately, the long-term economic impacts could also be compared with long-term economic costs.
Local Action Planning - This report has further value as an indicator of needs for local actions. The analysis indicates that some types of business, such as manufacturing and distribution facilities, are being attracted at least in part because of the region's improved highway accessibility. The report indicates that other types of business, such as lodging, restaurants and attractions, are also opening up in anticipation of an increase in visitors. Of course, there will have to be local marketing, supporting infrastructure and services, and land development controls and assistance mechanisms to ensure that these investments will succeed and that communities are made better as a result.

< Previous

Contents

Next >

FHWA Home | HEP Home | Feedback