How Much Money Does Sitting in Traffic Waste?

Gridlocked traffic conditions robbed the U.S. economy of $124 billion in 2013, with that figure expected to rise to $186 billion by 2030, according to a new study on congestion in the U.S. and Europe by the Centre for Economics and Business Research (CEBR) and INRIX, a U.S.-based provider of real-time traffic info and analytics. That would place the cumulative costs of overcongestion over the next decade and a half at $2.8 trillion, roughly equaling the entirety of income taxes paid by U.S. residents in 2013.

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The study examined direct costs of time spent wasted sitting stuck in traffic, i.e. fuel costs, vehicle maintenance and lost wages, along with the indirect costs that businesses pass onto their customers as a result of commercial drivers spending unnecessary time and fuel on our roadways. That amounts to $1,700 for each American household today, with that figure set to rise to $2,300 by 2030 unless we undertake drastic steps to move away from our current system of overcongested roads.

Los Angeles was predictably the worst city in the nation for gridlock-related waste, accounting for $23.2 billion in 2013 or nearly 20% of total congestion-related costs in the entire country. Even as LA moves to improve public transportation, that figure is expected to rise to $38.4 billion by 2030.

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To take steps to adequately address this massive problem and bring down waste, we’ll need to do much more than add additional light rail, buses and bike paths. Alternative forms of transportation, especially in currently underserved areas, are a big part of the equation, but the real key lies in making our roads, cities and cars smarter, the study finds. INRIX and CEBR recommend a holistic approach of greater connectivity between cars, and smarter city infrastructure with which to support smarter driving habits.

Autonomous vehicle technology, for example, could go a long way toward alleviating rush-hour congestion as it would allow for each vehicle to travel at the maximum safe speed regardless of the number of cars on the road. Other promising tech currently in development includes rerouting of traffic at the citywide level based on current gridlock through communication over a large network of connected cars and smartphones, and “smart parking” systems whereby city neighborhoods can direct cars to the closest available parking or electric car charging stations.

Says Kevin Foreman, INRIX General Manager of GeoAnalytics: “As the economy grows and more people live in urban areas, greater demand is placed on our roads. Until we evolve our approach to how we manage our transportation networks, the individual and societal costs are only going to get worse.”