Rail line would be huge boon for economy: report
An ultra-high-speed rail line between Vancouver and Portland would create hundreds of thousands of jobs and billions in economic benefits for the Vancouver-Seattle corridor, according to an economic analysis.
The analysis, paid for by Microsoft and trade unions, was added to a rail line study conducted by Washington state’s department of transportation released in December.
The state’s report looked at three potential technologies and three possible routes for an ultra-highspeed rail line. The economic analysis focused on a seven-stop route between Vancouver International Airport and the Rose Quarter station in Portland which has the highest potential ridership of about two million annually by 2035.
The analysis assumes the use of maglev technology, which uses magnets to lift a train off its tracks and move it along a guideway at more than 400 km/ h, reducing the time it takes to get from Vancouver to Seattle to under an hour. It pegs the project cost around $40 billion.
The memo focuses on the effects in the nine-county corridor in Washington state and in B.C., and looks at the employment and labour income impacts from construction and operation of the service, along with wider economic spinoffs. During the nine years (2025-2034) it’s expected to take to construct the line, the study estimated 38,000 jobs would be created each year and there would be $29 billion in annual labour income.
Lindsay Meredith, professor emeritus at Simon Fraser University’s Beedie School of Business, said there is unquestionably value in creating temporary construction jobs, but the key is to look further.
“I really appreciate short-term economic impact — what I appreciate more is long-term downstream economic impact,” he said.
For the first 20 years of the rail line’s existence, operations and maintenance activities are expected to result in 3,000 long-term jobs per year and $5 billion in labour income.
On a wider scale, it’s estimated that as the line becomes more used it could result in 116,000 to 160,000 more jobs per year over the first 20 years of operation, and the associated labour income would be between $208 billion and $282 billion. Business output — which includes profits, taxes, subsidies, wages, income, benefits, and the costs of purchased goods and services — is estimated at $532 billion to $738 billion and value added, or gross domestic product, from the industry is expected to increase by $264 billion to $355 billion.
Meredith warned “the multiplier effect” can result in the numbers relating to the wider impact being inflated.
Gord Lovegrove, associate professor at University of B.C. Okanagan’s School of Engineering, said the analysis used industry-standard tools and the estimates for job and economic spinoffs are “in the ballpark.”
“They’ve tried to be conservative,” he said. “In all, I think they ’ve taken a good first step.”
However, he did say because they ’re using maglev technology in their modelling and looking more than 10 years into the future, the timelines could be longer and costs higher than predicted.
“With transportation planning at the best of times, your error can be huge,” he said.
“I tell my students the best models usually have 30 per cent error, plus or minus.”
The analysis indicates the project has “large economic development potential for the region and suggests there is good reason to continue project development.”
Meredith said he wasn’t surprised at the analysis’s conclusions considering Microsoft and unions were footing the bill, but agreed the numbers are feasible.
Next steps include performing a corridor planning study, further evaluating ridership, setting up a multi-government commission for planning purposes, looking at funding mechanisms and preparing a more detailed business case.