Do Rural Highways Lead to Prosperity?

[imgbelt img=apphighway530.jpg]An ambitious highway system through Appalachia hasn’t lifted most of the region from economic distress. Have we hoped — and invested — too much in better roads?


this report, projections of new jobs from the highway project range between 80,000 and 90,000; the ARC writes that $5 to $5.7 billion of “value added” would be created if the project is finished. Another $3.2 to $3.6 billion in wages would be generated, according to the report. In addition to these forecast benefits, there may be other, less quantifiable impacts, for example, reduced travel time, smoother travels, and fewer accidents, that would add to the overall value of the roads. However, these are all projections—the highway system’s tangible benefits are harder to determine.

The ARC website is surprisingly obscure when it comes to measuring the effects of the system to date. There are plenty of reports about its potential, but the latest data that actually attempts to quantify the highways’ effects on local economies is from 1998. This report mentions some 16,270 new jobs created by the ADHS (almost 1,400 of them jobs related to the road construction itself, jobs that presumably no longer exist) by the end of 1995—30 years after the project began.
In absolute terms, the jobs provided a definite benefit. But what longer term effects has the highway system had on the Appalachian counties it passes through? Has it alleviated the region’s economic woes?

The available data does not suggest that the new highway system has brought prosperity with it.
Unemployment in Appalachia, which was at 4.0% in 1970 shortly after the ADHS began, was as high as 5.7% in 2000—a relatively prosperous year. So it appears the ADHS has not brought in enough jobs to appreciably decrease unemployment. Unemployment in Appalachia has fluctuated since the outset of the highway project but has shown no appreciable change.

Additional questions arise in comparing maps of the ARC’s designated “distressed counties” with the highway system’s route (See below).

“Distressed counties” are those where the three-year average unemployment rate, per capita market income, and poverty rate are in the lowest 10% of U.S. counties (the distressed counties constitutes a relative – not an absolute measure. These counties may have improved economically but still lag behind the nation as a whole).

according to this report.

An ARC report notes the “continuing out-migration of the college and working-age population” — the very people who are needed to fill jobs that the ADHS was intended to attract are leaving. Another report says that the distressed counties have experienced “significant population losses.” In other words, conditions in counties along the ADHS system may have worsened. With newer roads, it’s become just as easy to exit as to enter, and the decline in working-age population seems to indicate that the roads are facilitating the export of people and jobs.

in the same span. ARC reports that these industries will lose even more jobs in the coming years.

These are the business sectors that rely heavily on the highways. While the highways have gotten better since 1960, the local industries have gotten worse. The ARC’s 2008 report forecasts thousands of potential new jobs in these declining sectors if the highway is completed. Yet the agency has pinned much of ADHS’s promise on truck-dependent industries that are shrinking.

The cost-benefit analysis of the roads is also worth considering. Older reports on the ARC site state that “every ADHS corridor that has been completed to date has created economic efficiency benefits.” But what about the costs? So far, $12,142,440,625 has been obligated to the program, with a projected $57 million more required for completion. ARC’s reports have been noticeably aggressive in their calculations of economic benefit, the 2008 report only including the optimistic projections of “medium” and “high” growth; the report did not include a “low growth” estimate of economic benefit. This third possibility is now a stark reality with the natjon’s economic downturn.

The ADHS is just one part of a larger picture of road construction in Appalachia, which includes many other local efforts to improve transportation. A joint study between the ARC and the University of Tennessee considers these other regional and local efforts and looks at the region’s transportation development as a whole. It concludes that transportation, when inadequate, is a hindrance, but improved transportation does not, in and of itself, promote development.

Location often matters; but prosperity doesn’t necessarily flow from great roads. Instead, what matters is the particular type of transportation development, and the existing economic activity in the region. When the ARC forecasts the highways’ creating new mining and manufacturing jobs (2008 report), those projections should be considered with healthy skepticism. If roads themselves don’t foster growth, and they’re being built into areas with little economic promise, it’s unlikely that much will change.

Jefferson Sinclair is an intern at the Center for Rural Strategies in Whitesburg, Kentucky, and a student at the University of North Carolina at Chapel Hill.