Yahoo Finance New index aims to measure US economic recovery by tracking how empty parking lots are
How’s the economy doing? Just check the parking lot at your local mall or big-box store to find out.
That old maxim is being turned into a science of sorts with a new “road to recovery index.” A tech company hopes a tool that takes the pulse of the parking industry will also serve as a larger economic indicator for a nation still digging itself out of the COVID-19 recession.
FlashParking, a technology supplier to top parking garage operators, has started surveying its clients in eight metro areas — New York, Los Angeles, Chicago, Philadelphia, San Francisco, Houston, Miami and Atlanta — about their financial performance.
“We see this as a (measure) of overall parking and mobility health and that connects directly to economic health,” said Sabrina Zahn, vice president of marketing at Austin, Texas based Flash.
The company partnered with Ernst & Young and the National Parking Association to compile the index and plans to publish it quarterly.
There’s no shortage of relatively new gauges that economists are using to assess the recovery in close to real time. They include OpenTable, the online restaurant reservation service, and Google Mobility, which tracks cellphone signals to determine whether consumers have returned to working in offices, shopping and entertainment.
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Zahn said Flash’s road-to-recovery index partly overlaps with those barometers but also provides additional data, since garages track precisely when customers arrive and leave, shedding light on their schedules and how long they’re spending on activities.
The data also comes from a segment of the economy that has been particularly hard hit during the pandemic and suggests many peoples' behaviors have not returned to normal.
Parking revenue plunged to 44% of its pre-pandemic level last year and returned to just 50% of its pre-crisis mark by mid-2021, Flash said. That’s a dimmer snapshot of the economy’s health than other measures.
Moody’s Analytics’ back-to-normal index – which includes OpenTable, Google Mobility and other indicators – was at 93.6% in late October. And U.S. gross domestic product – which includes e-commerce sales and other spending that’s unrelated to Americans’ activity outside the home – topped its pre-COVID peak in the second quarter.
Parking garage revenue, however, is skewed toward venues that were hit especially hard by the outbreak, such as airports, sports arenas and offices. Many consumers have been reluctant to return to flying, large gatherings and working in offices, especially while the delta variant was fueling COVID spikes over the summer.
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Airport parking revenue tumbled 75% last year and has notched a solid rise the first half of 2021 but was still at just 31.5% of its pre-pandemic level by June, Flash figures show. Parking income for events such as concerts and basketball games fell 50% in 2020 and returned to 76% of its pre-COVID the first half of this year.
And parking revenue for the office/university category and the commercial segment — shops, hotels, restaurants and other businesses — declined less sharply last year and have seen more modest recoveries, according to Flash.
The parking data also reveals when people are doing things and how much time they're spending, highlighting how the pandemic has changed their behavior. While many workers have returned to offices, their arrivals are spread across the morning rather than during rush hour, they’re staying for shorter periods and many are making digital parking reservations, which rose 44% last year.
“People have more flexibility now and are being intentional about when they choose to commute or come into the office,” Flash said in a statement.
Many workers who have returned to the office don't come into work as often as they used to, as some companies allow for remote work multiple days a week. The result: The demand for monthly parking rentals, often used by urban office workers, has fallen sharply.
And many people who park at offices or malls are then renting e-scooters for longer periods than they did in 2019 so they can run other errands, indicating they’re being more practical and combining activities, Zahn said.
"Consumers are looking for flexibility where they live and work," the company said.
This article originally appeared on USA TODAY: Parking lot index key to understanding US economy, FlashParking says
