New research shows the huge economic impact of buses
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Independent research on the scale and breadth of economic benefits
delivered by local bus services to the British economy highlights
how investment in them by government offers excellent
value-for-money. The Economic Impact of Local Bus Services,
commissioned by the Confederation of Passenger Transport, shows:
Bus operators directly employ 105,000 people and support employment
of a further 53,000 in the sector's supply chain – which provides
an £11 bn boost to the...Request free
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Independent research on the scale and breadth of economic benefits delivered by local bus services to the British economy highlights how investment in them by government offers excellent value-for-money. The Economic Impact of Local Bus Services, commissioned by the Confederation of Passenger Transport, shows:
The research also shows that buses deliver a host of wider benefits for both passengers and local communities - including access to jobs, education and training worth £8.7bn, health benefits worth £2.8bn, support for volunteer work valued at over £1bn, and a reduction in congestion worth £600m per year. Launching the results of research in Derby Graham Vidler. CEO at the Confederation of Passenger Transport said, “This new research shows the tremendous economic contribution driven by the 100,000 people who work in the bus sector, the 50,000 people working in our supply chain, and the millions of people who use buses every day. It highlights how buses support every aspect of our lives, boosting local economies, connecting communities, improving health, and protecting our environment. It also shows that investing in better bus services is exceptional value-for-money and offers a speedy, flexible way to support green growth across the whole country.” CPT commissioned this research to provide an up-to-date appraisal of the scale and contribution buses makes economically (and socially) to inform national and regional level for investment in better services and infrastructure. Speaking about the research, Claire Ward, Mayor of the East Midlands said: “The launch of this new report by the Confederation of Passenger Transport is both timely and vital, highlighting the essential role that buses play in driving the economic and social vibrancy of our region. It's particularly encouraging to see Nottingham recognised for its high level of bus sector employment and the innovative practices of our local operators, like the Skylink service to East Midlands Airport and the excellent work by Trentbarton and NCT. These examples underscore the critical importance of buses in connecting our communities, especially in rural areas where they serve as a lifeline for so many. “In Derbyshire and Nottinghamshire, the economic impact of our bus services is profound, with £1.8 billion generated in the East Midlands Combined County Authority area alone. This report confirms what we already know: buses are not just a mode of transport but a cornerstone of our local economy. As we look ahead to new opportunities with the Better Buses Bill, it is crucial that we continue to invest in our bus networks, ensuring they remain sustainable, innovative, and responsive to the needs of our communities. By working closely with operators, we can deliver a network that truly benefits everyone in the East Midlands." Scott Knowles, Chief Executive, East Midlands Chamber added, ” Local bus services are incredibly important to the business community. Employers rely on local bus services as a key option for employees travelling to and from work as well as growing their talent base from further afield, supported by bus routes. Travelling by bus also creates opportunity for a diverse range of employees for whom access to employment would be challenging without easily accessible bus routes.” Buses are the nation's most popular form of public transport - facilitating over ten million journeys a day. For every journey made on the national rail network, more than 2.5 journeys are made by bus. The research quantifies various kinds of economic impact made by buses: The bus sector itself, worth more than £11 billion per year to the GB economy, directly employed 105,500 in 2022 - as drivers, mechanics, schedulers, operations managers, customer service teams, and in finance, information technology, human resources, and general management. A further 53,000 people also worked in the sector's own supply chains - from vehicle manufacturers and fuel suppliers, to running bus stations, stops, and depots as well as vehicle maintenance, parts, real-time information, and ticket technology. All these workers also spend their wages in local economies, which in turn supports additional local employment. For many people, buses are the best way to access work, education, healthcare, volunteer, and leisure activities. This research confirms how compared to not travelling at all, or travelling another way, bus services provide lower travel costs and improved connections for passengers worth £8.7 billion per year. Using the bus also generates a wide range of health and wellbeing improvements that the research suggests have a combined economic impact of £15.6 billion. In particular, the health benefits of bus being a more active travel mode are worth £2.8 billion per year while reduced congestion and modal transfer is valued at £0.6 billion. Bus passengers spend £39.1bn billion per year in their local economies. On average, bus passengers - travelling for leisure, shopping or to get to work - spend £32 per return journey in shops, cafes, restaurants, and leisure facilities at their destinations. This spending supports economic activity in local and regional centres across Britain. More than two million commuters rely on buses and provide businesses in local economies with labour. These bus passengers earn approximately £72 billion per year and generate additional tax revenue of over £15 billion per year. Without local bus services, some passengers might find alternative ways to travel but some trips would simply not take place, replaced by online purchases instead or by no spending at all. The research estimates the impact of this could mean High Streets lose £9.2 billion per year. The research also confirms the value of public spending to improve bus services: Taking a selection of typical investments including alterations that give buses priority over other traffic on the roads, higher service frequencies, and lower fares, researchers calculate that every £1 of public funding spent on a typical package of measures can generate at least £4.55 in economic benefits, a figure that rises to over £5 for more targeted interventions such as bus priority measures. In addition, the research puts a figure of £3.5 billion per year on the economic value of the bus network for people who don't actually use the bus but want or need the option to be available. ABOUT THE RESEARCH CPT commissioned KPMG UK to produce this research between May and August 2024. In addition to an economic analysis built from multiple sources of publicly available data, an engagement phase of research was undertaken with a range of key stakeholders across England, Wales, and Scotland. The resulting analysis covers Great Britain (occasionally UK) as a whole, with nation breakdowns for England, Scotland, and Wales. Appendix 2 of the report also contains breakdowns for English regions and the Combined Authorities within them. There is no further breakdown for Scotland and Wales beyond nationwide, due to a lack of available data at this level.
Bus operators are also significant regional employers - London, Birmingham, Manchester, Liverpool. Leeds, Nottingham @ >2k bus sector About the methodology Figure 1 on page 10 of the Report describes the analytical framework used to complete the research. Please note that all values in the tables and map in the report appendices are rounded to the nearest £5 million. This may cause slight discrepancies in totals. Re: the economic activities of those involved in the provision of bus services: The direct impacts are company profits (and their associated taxes), wages to employees, spend on operating costs (e.g. fuel) and capital investment (e.g. buying a bus made in Britain; the sources of data for these are on page 41. The indirect impacts are the spending of the supply chain and bus manufacturers on good and services to supply the bus sector or manufacture buses; the calculations for this are on page 42. Induced impacts are the spending of bus company employees and the supply chain in the wider economy; the calculations for this are on page 42. Re: calculating the economic and social activities of bus passengers: These benefits user and non-user benefits have been calculated using the approach outlined in the Department for Transport's Transport Analysis Guidance. This approach converts the number of bus journeys undertaken into monetary benefits by using a set of appraisal values for a range of benefits, derived from economic literature. Evidence sources and workings for this can be found on pages 42-44. Re: the economic impact of bus passengers interacting with local economies: Using evidence from the DfT on the likelihood that passengers would not make the trip if the bus service were unavailable, KPMG estimated the proportion of spending attributed to journeys no longer made. The tax revenue generated by people commuting to work by bus has been assessed by using estimates of the proportion of commuters using buses taken from the 2023 National Travel Survey (“NTS”) and median earnings by area from the Annual Survey of Hours and Earnings. Data sources can be found on page 45. Re: economic benefit/CBA of each £1 of investment for bus services: These were calculated using DfT style appraisal. Table 2 on page 25 shows examples of existing capital and revenue expenditure initiative. Table 3 on page 26 then highlights the potential value of individual investments, as part of a wider package. A parallel piece of research completed in a similar way and over the same period has evaluated the economic impact of coach services. The results of this research will be published later in the coming weeks. Contact media@cpt-uk.org for further information. Downloads |
