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Latest INRIX Gridlock Index (IGI) Drives Optimism for the U.S. Economy in 2013

Kirkland, Washington – January 31, 2013 – Despite the hustle and bustle of the holidays, the INRIX Gridlock Index (IGI) shows drivers spent less time in traffic in December 2012 versus the same period one year ago. Compared to the dramatic 20 percent drop in traffic congestion year-over-year from December 2010 to December 2011, gridlock declined just three percent year-over-year in December 2012.

“For the first time in several years, we’ve avoided a complete freefall in December traffic congestion,” said Bryan Mistele, CEO of INRIX. “The results suggest the economy finally may be turning the corner.”

The December IGI numbers follow a 15 percent increase in traffic congestion in November – the first monthly increase in nearly two years. Recent IGI trends mirror the latest data from the Conference Board’s Leading Economic Index® (LEI), which rose by half a percent in December.

The IGI score for December 2012 decreased by only 2.9 percent on a year-over-year basis, an
improvement from 2011, which saw a December year-over-year decrease of almost 21 percent.

The latest IGI score also included some good news from an unexpected source. Detroit, historically an IGI underperformer, was among the metropolitan areas measured that defied the seasonal effect which normally sees traffic fall from November to December. Detroit’s gridlock increased by almost 10 percent month-over-month; by contrast the IGI composite for all 10 metropolitan areas fell by approximately 14 percent. This may be a positive signal for Detroit’s economy, in line with recent reports that housing prices in some Detroit neighborhoods may be rebounding , and that the number of auto manufacturing jobs in the city has increased by 27 percent since 2009 (the year that General Motors filed for bankruptcy protection).

The nine remaining metropolitan areas examined by IGI experienced month-over-month decreases in traffic congestion in December. In particular:

• Atlanta’s IGI score decreased from 11.1 in November 2012 to 9.3 in December 2012. On a year-over-year basis its December 2012 IGI score decreased by nearly 14 percent. While slightly improved from the year-over-year change seen in December 2011 (-16.7 percent), it may be of little comfort to those already unsettled by former CNBC Chief Economist Marci Rossell’s recent observations that the region may have experienced a “lost decade.”

• Boston’s IGI score decreased month-over-month by almost 19 percent, from 17.2 in November 2012 to 14 in December 2012. However, on a year-over-year basis its December 2012 IGI score increased by 5.4 percent, significantly improved from the year-over-year change seen in December 2011 (-27.5 percent). This is in line with the Federal Reserve’s report of moderate economic growth in its most recent “Beige Book” survey of the region.

• Dallas’ IGI score fell by 17 percent month-over-month to 9.6 in December 2012. On a year-over-year basis its December 2012 IGI score changed by -9.1 percent, deteriorating from the year-over-year change seen in December 2011 (-5.6 percent).

• Chicago experienced the largest month-over-month decline of all IGI metropolitan areas. Chicago’s IGI score decreased over 24 percent, from 13.4 in November 2012 to 10.2 in December 2012. This was likely influenced by a major winter storm that struck the region the week before Christmas. On a year-over-year basis its December 2012 IGI score changed by -16.9 percent, an improvement from the year-over-year change seen in December 2011 (-27.7 percent).

IGI Scores: December Averages
Percentage increase in the duration of the average road trip due to gridlock
Metro Area December 2010 December 2011 December 2012
Atlanta 13.0 10.8 9.3
Boston 18.3 13.2 14.0
Chicago 16.9 12.2 10.2
Dallas 11.2 10.6 9.6
Detroit 12.8 5.8 7.2
Los Angeles 36.3 29.8 27.7
Miami 14.5 13.4 12.9
New York 25.7 20.4 21.8
San Francisco 27.4 23.3 23.7
Washington D.C. 22.0 16.9 15.6

Overall: 19.8 15.7 15.2

INRIX Gridlock Index (IGI) Methodology

The INRIX Gridlock Index draws data from the INRIX Traffic Data Archive, a historical traffic information database comprised of data collected from hundreds of public and private sources, including a crowd-sourced network of approximately 100 million vehicles and mobile devices.

Drawing on almost three years of trend data, INRIX has developed methods to interpret real-time traffic data to establish monthly and annual averages of traffic patterns in all major U.S. metropolitan areas. These same methods can aggregate data over periods of time to provide reliable information on speeds and congestion levels for given segments of roads. Using this proprietary data collected from INRIX’s extensive network, the IGI analyzes and measures traffic trends in 10 of the top metropolitan areas in the U.S. The metropolitan areas used in the IGI are defined by the Core-Based Statistical Areas (CBSA), as determined by the United States Census Bureau.

There are two key building blocks for the analysis used in the IGI:
• Reference Speed (RS): An uncongested “free-flow” speed is determined for each road segment using the INRIX Traffic Data Archive.

• Calculated Speed (CS): Speed data from the INRIX Traffic Data Archive is analyzed to determine the “calculated speed” for each 15-minute period of each day, for each road segment every month (e.g. Monday from 06:00 to 06:15 for April 2012). Thus, each road segment has 672 corresponding calculated speed values per week – representing four 15-minute time windows for each hour of the day, multiplied by seven days in a week.

To assess congestion across a metropolitan area, INRIX utilizes and adapts several concepts that have been used in similar studies and previous INRIX analyses.
The IGI represents the barometer of congestion intensity. For a road segment with no congestion, the IGI would be zero. Each additional point in the IGI represents a percentage point increase in the average travel time of a commute above free-flow conditions during peak hours. An IGI of 30, for example, indicates a 20-minute free-flow trip will take 26 minutes during the peak travel time periods, which is a 6-minute (30 percent) increase over the free-flow travel time.
For each road segment, an IGI Index is calculated for each 15-minute period of the week, using the formula IGI= (RS/CS) – 1.
“Drive Time” Congestion: To assess and compare congestion levels year to year and between metropolitan areas, only “peak hours” are analyzed. Consistent with similar studies, peak hours are defined as the hours from 06:00 to 10:00 and 15:00 to 19:00, Monday through Friday – 40 of the 168 hours of a week.
For each metropolitan area, an overall level of congestion is determined for each of the 40 peak hours by determining the extent and amount of average congestion on the analyzed road network. This is computed as follows, once IGI’s are calculated for each road segment:
• STEP 1: For each of the 40 peak hours, all road segments analyzed in the CBSA are checked. Each road segment where the IGI is greater than 0 is contributing congestion and analyzed further.
• STEP 2: For each road segment contributing congestion, the amount the IGI is greater than 1 is multiplied by the length of the road segment, resulting in a congestion factor.
• STEP 3: For each 15-minute period, the overall metropolitan area congestion factor is the sum of the congestion factors calculated in STEP 2.
• STEP 4: To establish the metropolitan IGI for a given 15-minute period, the metropolitan congestion factor from STEP 3 is divided by the number of road miles analyzed.
• STEP 5: A peak period IGI is determined by averaging the 15-minute indices from STEP 4.¬¬

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