Logistics industry has been key driver of growth in NEPA economy

WILKES-BARRE — Teri Ooms, executive director of The Institute for Public Policy & Economic Development at Wilkes University, said recently one of the most significant economic transitions occurring in recent years in Northeastern Pennsylvania is the growth of transportation-centric industries.

And, Ooms said, the logistics industry has been a key driver of growth in the Northeastern Pennsylvania economy.

“Particularly, distribution centers, freight trucking, and other associated industries have grown in business parks along the Interstate 81 corridor,” Ooms said. “Growth has not abated in recent years, and regional developers and economic development agencies have made available additional vacant land suitable for further development, and new business parks or expansions to existing parks have been proposed.”

Ooms said given this industry’s reliance on surface transportation and clustering in business parks outside of the region’s urban cores, there will continue to be numerous implications on land use and transportation planning and infrastructure investment.

The Institute’s 2020 report was prepared as a survey of how this industry has grown in Northeastern Pennsylvania, where further growth can be expected, and what a full build-out scenario may mean for transportation planning in Northeastern Pennsylvania.

“In other words, in light of this growth in transportation-centric industry and decentralization of employment, what kind of transportation infrastructure and land use planning tools are necessary for continued growth and sustainability?” Ooms asked.

The Industrial Transportation and Distribution Cluster is made up of several component industries, including warehouses (which includes distribution centers), freight trucking, rail transportation, and certain support industries. Together, this cluster has seen nearly five percent growth in employment in the two county region in the last decade, compared to an economy wide growth rate of only about 0.1 percent. The warehousing and storage component makes up about 70 percent of total employment in the industry.

According to Andrew Chew, Senior Research & Policy Analyst at The Institute, as this industry is dependent on transportation infrastructure (primarily road infrastructure), it can be seen that industry developments closely follow the interstate highway system, by which goods can be moved between states by heavy truck.

Chew said the region’s largest cluster in the Pittston area is located near the junction of Interstate 81 and the Northeast Extension of the Pennsylvania Turnpike (Interstate 476). The next largest, in Hazle Township, is located near the junction of Interstates 81 and 80. Lackawanna County’s industry cluster in the Valley View area is located along the Casey Highway, near Interstates 81, 84, and 380. Finally, the Hanover Township industry cluster is located close to Interstate 81 approximately equidistant between Interstate 80 and the Pennsylvania Turnpike.

Chew said economic growth in these areas is being driven by a combination of private developers and economic development agencies. However, continued development opportunities appear to be present at each of the major industrial park clusters mentioned above.

“There are several reasons why transportation and distribution industries may be particularly impactful on regional traffic patterns,” Chew said. “First, these employment centers are located in business parks outside the densest population centers of the region, necessitating that many employees commute by car. Furthermore, the nature of these firms necessitates the receiving and shipping of goods, primarily by truck. Because much of the freight coming into and out of distribution centers originates from or has a destination outside the region, the Interstate Highway system is of particular importance.”

Commuting a factor

Chew said commuting is also a factor in traffic trends affecting business parks. Due to the location of existing business parks outside the region’s largest population centers, employees frequently commute by private automobile. While public transit serves each of the employment centers analyzed here, Chew said many employees might live in areas where they cannot easily access buses that serve the business parks.

“In 2019, The Institute’s Planning, Land Use, Transportation, and Infrastructure Task Force published an analysis of workers employed in census tracts covering these four employment clusters (regardless of industry),” Chew said. “That report showed that across the four employment centers analyzed, no more than 25 percent of employees live in census tracts served by the bus routes that serve that employment center.”

Chew went on to say that there are nearly 5,000 industrial park workers living in census tracts served by direct transit to an employment center, or 21 percent of all workers in the four employment centers analyzed.

“While some of those residents likely do not live within walking distance of a bus stop, or would not be able to use mass transit to commute because of scheduling, it is also likely that at least some industrial park workers could comfortably use transit to commute to work,” Chew said. “Overall, commuting to work via mass transit remains low throughout the region.”

Orderly, efficient movement

Ooms and Chew said due to the nature of this industry cluster as land-intensive and transportation-centric, the planning implications are significant. A core component of these firms business involves shipping and transporting goods over long distances, particularly using the Interstate Highway System.

“A key planning principle is the orderly and efficient movement of freight from distribution centers to interstate highways,” Chew said.

Ensuring that appropriate transportation systems are in place to handle current and future freight and commuter traffic is also essential for the continued success of the firms themselves, Chew said. Supply chain research has shown that shippers and carriers face significant cost burden from delays and reduced reliability caused by traffic congestion, and the fastest growing form of congestion delay is on urban roads and highways.+

Air quality affected

Increased truck and commuter traffic also affects air quality and greenhouse gasses linked to climate change. Between 1990 and 2006, EPA data showed green gas emission growth of 27.6 percent from transportation, the largest growth of any sector except for electric power generation during that time.

Within transportation, emissions from medium and heavy-duty trucks and buses grew by 76 percent, higher than any other vehicle type. Chew said overall air quality has consistently been good in the region in recent years, according to EPA air quality data.

Wear and tear

Wear and tear on the region’s roadways is another implication of a potentially higher share of truck traffic, Chew said. Conditions such as fatigue cracking and rutting reduce the life of pavement and worsen travel conditions. Studies have associated increased vehicle weight with pavement damage.

“Inadequate facilities for truck parking may also be a growing issue,” Chew said. “As truck volumes grow, a need for safe and appropriate truck parking/stopping facilities will also grow.”

Recommendations

Chew and Ooms said continued growth in this industry group will require continued refinement of transportation and land use planning regimes.

They said as freight and commuter traffic grows in parallel to serve new developments that emerge, planning decision-makers must consider both highway capacity as well as transportation alternatives.

In order to reduce the burden of business park workers commuting in private automobiles, stakeholders must support efforts to diversify transportation mode share.

“Public transit, carpools or vanpools, and enhanced bicycle and pedestrian infrastructure connecting nearby population centers with business parks could help alleviate congestion as freight traffic grows,” Chew said. “One challenge is a limited provision for bus stops and sidewalks in most existing business parks.”

Rail facilities could also be an important asset to both facilitate further economic development and reduce negative impacts of increasing truck traffic volumes, the report shows. The intermodal freight facility in Taylor, which is in close proximity to the Pittston and Lackawanna County employment centers, offers an alternative mode to reduce highway truck miles, thereby reducing highway wear-and-tear costs and congestion.

Opportunities to utilize air freight could also be important given the close proximity of several of these employment centers to Wilkes-Barre Scranton International Airport.

Finally, restoring passenger rail service to the area could help alleviate congestion on the Interstate 80 and 380 corridors by reducing the number of passenger car trips from Northeastern Pennsylvania into Northern New Jersey and New York City via those highways. Switching a significant share of these 28,000 commuters to non-highway modes could help to counterbalance growth in truck volumes due to economic development.

Planning of business parks themselves can also be a useful tool. Industrial parks in Asia have sought to more fully integrate with nearby central cities to create a more symbiotic relationship, in a reversal of the historic American model of economic decentralization reducing the vibrancy of urban centers. The model employed in China also emphasizes mixed uses, including residential development within and near industrial parks.

The logistics industry cluster represents a transformative change to our region, both economically and in terms of transportation needs, and continued growth is expected due to the region’s advantageous position relative to the Interstate Highway System and sustained emphasis on ecommerce over brick and mortar commerce in many industries.

Continued growth of this industry cluster helps to shape regional transportation priorities, and the region must plan for its transportation network to adequately respond to full build-out of existing and proposed business parks.

Connecting freight traffic with limited access highways as quickly and efficiently as possible should be the focus of highway infrastructure improvements. Several projects have already been proposed, such as an additional interchange along the Casey Highway.

The recent extension of Navy Way Road provided additional access to Pittston Area business parks directly from I-81 via the reconstructed Exit 178. Projects such as these could help reduce congestion and wear-and-tear on local streets by providing freight traffic with the shortest feasible travel distance to nearby limited access highways, and additional access points to those major highways allows for better system redundancy and alternative routes for diversion of traffic from existing busy intersections which may be at or near their design capacity.

Pavement damage could also be prevented by reducing truck miles traveled on local streets that may not be designed for significant truck traffic.

While projects to increase road or intersection capacity may be warranted in some cases, Chew and Ooms said building up highway capacity should not come at the expense of bike, pedestrian, or transit safety and accessibility.

“There is a need for parallel efforts to grow multi-modal transportation options in order to better manage limited highway capacity,” Ooms said. “As The Institute found in prior research, the limited percentage of workers in several key employment centers who do have transit access to work without a transfer illustrates the need for additional collaboration on new approaches to solving transportation problems and meeting workforce needs of businesses.”

Work in this area is already underway, such as through planned public-private partnerships between transit operators and private employers. Increasing the reach of fixed-route transit into industrial parks and better coordination or consolidation of services across the several transit providers could also build transit system capacity.

Furthermore, local governments can use zoning and subdivision and land use ordinances in order to promote creation of bus stops, sidewalks, and other bike or pedestrian infrastructure in new developments.