The impact of bus transit on employee turnover: Evidence from quasi-experimental samples

Abstract

This analysis investigates the relationship between fixed-route bus transit and employee turnover using data from quasi-experimental samples. We expect that counties with fixed-route bus transit will have lower turnover rates because transit offers an affordable means of transportation to workers without automobiles, allowing these workers to reach job sites. Panel regression models and county-level data from Illinois, Indiana, Michigan, Ohio, Pennsylvania and Wisconsin from 1998 through 2010 are used to test this hypothesis. We find that the size of the fixed-route bus system (measured as real per capita operating expenditures) is negatively related to employee turnover rates: An increase in bus systems’ per capita operating expenditures is associated with a decrease in employee turnover. Decreases in employee turnover represent cost savings to businesses by reducing the costs associated with training new workers and rebuilding firm-specific knowledge or better employee-employer matches. These results suggest that access to fixed-route bus transit should be a component of the economic development strategy for communities not only for the access to jobs that it provides low-income workers but also for the benefits accruing to businesses that hire these workers.