Mobility Matters Daily #91 - Commuting, online ordering, and inequalities
With data showing that Birmingham city centre has more people working there who live there
Good morning friend.
The annual two weeks of summer has certainly arrived in the UK. Whilst sunny days are certainly welcomed, realising that British homes are especially good at retaining the heat during the summer makes home working much more challenging. Oh for an air-conditioned office. Speaking of which…
If you are asking what the future of the commute will be, you are asking the wrong question
What is becoming a frequent stream of articles saying that going back to the office is the norm included this one on the BBC, where a variety of people with interests in commercial property give the water cooler argument a lot. You may guess from my tone what I think of this, but I just want to pull up this focus on the commute, and how it again dominates our thinking in transport.
Simply, we do not know what will be the new commuting norm post-pandemic. Ther is some thought being put to the impact on other trips. For business trips, the recovery may be long and painful. A lot of the discretionary travel discussion focusses on the impact on holidays and tourism. Yet combined, these trips accounted for 22% of the annual trips of the average Brit in 2019. We must equally consider the impacts on ‘personal business’ trips like going to see friends and family, or heading to the doctors. For which there is a critical lack of evidence. When thinking of uncertain outcomes, we must look at all trips.
Ultra-fast delivery is the latest transport investment bonanza
According to this article in The Guardian, over $14bn in investment has been piled into companies promising sub-one hour deliveries since the start of last year. What is the value for investors? Ordering perishable items such as groceries is going crazy at the moment, with orders reaching $100bn in the USA alone, and clearly some investors expect this level of ordering to at least partly stick. Plus the algorithm that saves those extra few pennies off the unit cost of each delivery will deliver billions in value. And if you are thinking ‘data,’ that is just a way to realise that.
What this means for our transport network is uncertain. Will we see a flooded market like Uber, or delivery bikes in canals like dockless bike share? I would anticipate that there is a rapid expansion of total vehicles in this market in response to more online ordering, particularly here in the UK where we really, really like online ordering. But what will determine success is a mix of our appetite for ordering online, and the ability of these tech companies to squeeze out unit costs in a market that already has tight margins.
But online delivery is not equal to all
An interesting study by Ivan Sanchez-Diaz, Ceren Vural and Árni Halldórsson shows that there is an interesting confluence between the COVID-19 pandemic, the need for online delivery, and access to it. This is not just driven by the ability of people to use such services and their access to technology, but often more mundane barriers like their local store not offering online deliveries. It recommends that the public sector plays a more proactive role in overcoming accessibility issues related to online ordering, but I wonder if this is the true lesson here?
This is not just an issue of a poor understanding of social inclusion in transport (which is sadly widespread), but also relates to our understanding of market failure in transport. Or lack of it. This is often thought of in terms of undesirable outcomes, but more fundamentally it is about a misallocation of resources in a way that is inefficient to perfect market operation. What this paper shows more fundamentally is that in private deliveries, there is significant market failure that allocates resources in ways that miss significant portions of the potential market. If that isn’t a call for public sector intervention, I don’t know what is.
Stat of the day
Speaking of working, data from the Centre for Cities shows that not only are there fewer workers in British cities at the moment (the data shown in the image is for Birmingham), but that a much higher proportion live in the city centre too. The data is for the major cities and towns in the UK, and is well worth reviewing.
Data source: High Street Recovery Tracker