How much do road works cost a business?
British drivers are familiar with roadworks and temporary speed limits up and down the country — and the majority of drivers are aware of the frustration it can cause. For some businesses who rely on the roads to get from job to job, roadworks and temporary speed limits can slow down their progression, meaning that they are limited to how much they can get done in a working day as they need to factor in additional time for traffic and disruptions caused by roadworks and temporary speed limits.
In 2016, there were over 1.35 million traffic jams across the UK, costing the economy approximately £9 billion according to Inrix. November 2016 marked the worst month for the number of traffic jams, with over 169,000 recorded across the country – 50% worse than the average number. But how does this effect businesses who rely on the British roads? Long term van hire specialists, Northgate Vehicle Hire investigate.
Some traffic jams are unavoidable. Accidents happen, and when they happen on the roads, a traffic jam naturally follows – but what about traffic that could be avoided? A significant amount of traffic jams are caused as a result of road works and temporary speed limits, which is why the Local Government Association (LGA) have been calling for action by the government to limit the amount of road works that are carried out across the country, to reduce the risk of gridlock. Whilst it is also causing unnecessary carbon emissions and fuel, it also wastes a lot of drivers’ time – even more valuable time for those who are working between different locations.
The average driver reportedly spends around 32 hours a year stuck in traffic jams during peak periods – this figure doesn’t necessarily account for drivers who drive for a living, and are on the roads the majority of the day or night. For businesses which charge their customers an hourly rate, that is a loss of at least 32 hours of work – if you charge £15 an hour, that would be around £480 annually per employee. If you run a business of 15 employees, that is a minimum annual loss of £7,200 as a result of wasted time stuck in traffic.
Currently, 2.5 million road opening each year are caused by utility company digging – to which three quarters of small businesses say the road works have a negative impact on their business as a result – whether it is wasting valuable time in traffic, reducing sales or loss of earnings. It is no wonder road works cause such chaos on the roads when utility works supposedly reduces road life by at least a third, and when temporary speed limits are also set in place, the overall flow of traffic on the road becomes slower. If government figures are to be believed, the state of UK roads and traffic jams are only to get worse – traffic levels are expected to increase by around 55% by 2040.
Looking at the regions across the UK that are most likely to be affected by traffic jams and road works, businesses in Belfast are the ones who should worry the most about the cost impact of road works and traffic jams. In 2015, average congestion on the roads was at 40%, meaning businesses lost around 24 working days per vehicle per year. Overall, Belfast businesses experience around £12,673,050 cost as a result of road congestion. The remainder of the UK’s 10 most congested cities and towns rank as followed, according to CityAM.com:
|Rank||City/Town||Average Congestion||Working days lost per vehicle per year||Cost to business|
Beverley Wise, director for TomTom Telematics in the UK and Ireland commented:
“Making the most of billable time is key to profitability for any business, so organisations that rely heavily on a mobile workforce must look for ways to maximise the time employees spend actually doing jobs by minimising time spent on the road.”
However, if forecasts are correct and traffic levels do continue to rise across the UK, it looks like businesses could be faced with a significant loss.