On The Road Again: The Cost of the Employee Commute

Part Two

What does it cost for your employees to come to work? Previously, in The Back Story, we looked at the cost of childcare—knocking about $18,000-20,000 annually out of a parent’s paycheck for each baby’s or toddler‘s daycare. Today, we look at the cost of commuting, a topic of interest to me after meeting two people: one, a man working at a Bay Area tech company who had a four-hour each-way commute daily. He said he found his dream job, but his children were in school and daycare in the town he lived in—so he spent eight hours a day on the road—when the weather was good and there were no traffic issues. The second was a young Guatemalan woman who lived in rural California and commuted two hours for a position as a waitress with a new baby at home.

That is approximately 2,000 hours driving to and from work, 1000 hours for the waitress.

Most commuters do not face a four-hour commute to the office, yet the distance and the toll of coping with traffic add up to a significant cost to the employee. While the work-from-home model avoided these costs during the Pandemic, about half of employers currently require their workers to return to the office full-time. ¹

Of course, commuting costs vary depending on where the employer is located, fuel cost, the method of getting to work (driving, carpooling, public transportation), tolls, parking, and variation in car costs, maintenance, etc. Whether driving, ride-sharing, or relying on buses, commuter rail, or subways, the costs have risen. A recent study has revealed that the average American spends $8,466 and 239 hours each year commuting.² That’s nearly 19% of the average commuter’s income and roughly ten days a year spent on the road or in transit.

According to CharterUp.com, which conducted this research, this includes gas expenses that, on average, amount to $867 annually, plus additional costs for car maintenance that can add up to $410 per year. (Note: I do not know what this research used for the average cost of a gallon of gas). Inflation, global events, and fluctuation in oil production all lead to rising fuel prices, affecting both car owners and public transport users. And, of course, the cost of cars themselves has increased. In addition, one must consider the addition of registration costs, tires, taxes, depreciation, and insurance to the original sticker price.

According to an analysis of Census data by Eno Transportation, the distribution of people using different modes of transportation (e.g., driving alone, carpooling, or walking) to work has remained steady since 2010. Nearly 80% of Americans commute by driving to work each year alone.³ Another study determined that driving was the most stressful of all commuting options, with the direst potential effects. ⁴

Commuting is Not Fun.

No one likes commuting. Commuting to work and back, especially daily, takes a toll on the employee. Sitting in traffic, especially in congested urban areas, wastes time and increases stress. An interesting study by Dr. Francesca Ortegren concluded:

• People with long commutes are more stressed, more depressed, and less productivethan those who don’t commute as long.
• The cost of commuting disproportionately affects low-income workers. Lower-income people drive farther to work and spend more out of pocket.
• Longer and farther commutes were linked to worse health outcomes.
• Unscheduled absences from work can be related to the effects of commuting and cost employers nearly $2,700 per worker each year. ⁵

Fighting traffic and crowded parking lots is not just stressful; it is irritating. Employees arrive on the job already cranky and cross—hardly how one wants them to start their work day.

The Ortegren study reported that Americans spend an average of 46 minutes commuting to and from work each day, and nearly a third spend over an hour; if that employee spends 200 hours commuting annually (lower than the 239 national average), the opportunity cost lost by an hourly wage earner, for example, could be an additional $5,200 a year.⁶

…It’s also Unhealthy.

People who have longer commutes⁷ are 33% more likely to be depressed, 46% more likely to get less than 7 hours of sleep per night, and 21% more likely to be obese than people who commute less than 30 minutes to work (one-way), all of which can contribute to poor health. Those health costs might play a role in why commuters also tend to miss more ⁸ than those who live closer, adding to the potential for unforeseen consequences of commuting.

Job satisfaction is also negatively impacted by long commutes. Researchers in England found that adding 20 minutes of commuting per day has the same negative effect on job satisfaction as receiving a 19% pay cut. ⁹

Can HR Play a Role?

Increasingly, employees are looking to their employers for more work-from-home flexibility or monetary assistance to counter growing commuting costs, whether in terms of a cash benefit or travel and parking vouchers. Some companies provide buses to employees when a sizable number reside in one place away from the office. Because of Wi-Fi capabilities, the rationale includes adding hours of productive work to the employee’s day. Some provide shuttles from mass transport stops to the place of employment, encouraging employees to use public transit options.

Awareness is also critical. Likely, HR and managers are unaware of the time employees may have to commute or the difficulty of juggling the means to get to work. For example,

• How many of your employees have commutes that might be considered unreasonable?
• Do parents face conflicts when transporting children to daycare or school before getting themselves to work?
• Are managers aware of the toll commuting can take on the wellness and productivity of their teams?
• How do local travel patterns affect employee lateness on the job?
• Is the daily commute the measure by which employees manage their schedules?
• What would be the impact of flexible scheduling of the work day to better address traffic congestion in your location?

Conclusion

This series examines the cost of work to the employee. When we add commuting to childcare, we see a rationale for employees leaving the workforce. Employees’ salaries clearly must be commensurate with the actual cost of working. We will look at further costs to work in the final article in this series, which will appear here in the future.

ENDNOTES

  ¹ 50% of companies want workers back in the office five days a week–why experts say this strategy could fail. Morgan Smith. Mar 18, 2022.  50% of companies want workers back in office five days a week (cnbc.com)

² The Rising Cost of Commuting: A $8,466 Yearly Expense (charterup.com)

³ 2018 ACS Survey: While Most Americans’ Commuting Trends are Unchanged, Teleworking Continues to Grow, and Driving Alone Dips in Some Major Cities – The Eno Center for Transportation (enotrans.org)

⁴ Am stressed, must travel The relationship between mode choice and commuting stress. Alexander Legrain, Naveen Eluru, Ahmed M. El-Geneidy. Transportation Research Part F: Traffic Psychology and Behaviour Volume 34, October 2015, Pages 141-151. Am stressed, must travel: The relationship between mode choice and commuting stress – ScienceDirect

⁵ The True Cost of Commuting By Dr. Francesca Ortegren The True Cost of Commuting | Clever Real Estate (listwithclever.com) Updated April 10, 2023.

⁶ Ibid.

⁷ Long Commutes Costing Firms A Week’s Worth Of Staff Productivity. Mercer. May 17, 2017 London, UK.  Mercer | Long commutes costing firms staff productivity (archive.org)

⁸ Walking and cycling to work makes commuters happier and more productive. July 4, 2019. Walking and cycling to work makes commuters happier and more productive (theconversation.com)

⁹ Study: Adding 20 Minutes to Your Commute Makes You as Miserable as Getting a 19 Percent Pay Cut | Inc.com Tanza Loudenback, Business Insider, Oct. 23, 2017.

¹⁰ Commute Cost Calculator < Commute Solutions