Snowstorms Dump on Michigan Roads, Economy: Study says each day roads are impassable costs Michig
Monday, February 07, 2011
Snowstorms Dump on Michigan Roads, Economy: Study says each day roads are impassable costs Michigan's economy $250 million per day
Snowstorms cost Michigan $250 million a day in lost economic opportunity for each day the roads are impassable, according to a recent national study. Unplowed, slippery roads hamper business productivity because workers are unable to get to the job, shipments of materials and products is slowed, and retail sales and resulting sales taxes slump as consumers stay home.
The IHS Global Insight study also found that hourly workers are hurt the worst, accounting for about two-thirds of the direct economic impact of the snowstorm.
Major snowstorms in Michigan and other states also put economic pressure on state and local transportation authorities, who are dealing with decades of declining state funding. Last year, policymakers decided to cut money for snowplowing and other road maintenance activities to help secure full federal matching funds.
"This study demonstrates the futility in cutting transportation dollars while trying to jump-start our economy," said Keith Ledbetter, director of legislative affairs for the Michigan Infrastructure and Transportation Association. "Our transportation system is directly tied to Michigan's economic success."
The study, which also looked at 17 other states and provinces, further examined the indirect economic impacts caused by snow closures, including lost tax revenue and significant losses in the restaurant, general merchandise and service station industries. These indirect impacts more than doubled the initial direct impact of each storm.
"If we don't have good roads, we don't have a good economy," Ledbetter concluded.
Michigan's results from the study were the following:
Wages and Salaries Total $170.18
State and Local Taxes Total $6.35
Federal Taxes Total $12.53
Retail Sales Total $62.00
Total Economic Impact Total $251.07