Rising Gas Prices are Discouraging People from Commuting
With gas prices soaring, Americans are reporting they’re planning to drive less. Further, these rising oil prices also profoundly impact home heating bills. Since it is less feasible to turn down the thermostat in cold weather, choosing to drive less is an option that can save thousands of dollars during the course of a year.
In a March 2022 survey, AAA reported that fully 59% of respondents said they would make changes to their “driving habits or lifestyle” when gas costs more than $4 per gallon. (It’s above $4 dollars as of now.) And 80% said they would simply “drive less” if fuel costs rose to over $5 per gallon (In some parts of the country this is already the case.)
Earlier surveys have found that when gas prices climb over $4 per gallon, railroad commuting rises 9.34% on average for every 10% rise at the pump. Other surveys indicate that bike and scooter sales, in addition to walking, increase significantly in sync with rising fuel prices. And, indeed, bike shops are now reporting rapidly rising sales.
With people less willing to drive due to the highest gas prices in 14 years, remote work becomes even more attractive. While commuting to work has never been a pleasure, the pandemic taught millions of employees and employers that remote working is a reasonable option for many businesses and occupations. The current high gas prices have added fuel (excuse the pun) for this preference.
According to a Florida Realtors article, “Studies about the negative impacts of commuting have been reproduced for decades.” Since these studies were conducted before the pandemic and the recent rise in gas prices, we can safely assume that the disinclination to commute to work has only hardened. And since it is estimated that 90% of Americans commute to work by car, we can discern that a reduction in driving may have a profound impact on work habits and, therefore, lifestyle.
Further, according to Florida Realtors, “For Americans living in suburbs, [exurbs], and rural areas, transportation actually costs more than food each year on average (and this was before the recent gas price increases). This pressure by employees who wish to work remotely will probably propel more and more employers to adopt a hybrid work model.
Also, new office models such as WeWork (an office model where space and secretarial help are shared by different businesses), allow employers to set up mini offices in multiple locations which would serve to cut down on commuting times, and, hence, transportation costs. And when office space is shared, the costs are driven down drastically for the business owner, incentivizing him to consider this option. When the office is closer to home, it allows people to walk, bike, or take public transportation to work, which saves the employee money on commuting expenses.
It would seem that if gas prices continue to rise, more and more employees will pressure their employers to adopt a work from home model (at least for a couple of days a week). And in all probability, business owners will realize that flexibility in this regard would keep workers from switching employers.
And business owners know that a happy workforce is more productive than a resentful one.