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Is the end near for Commuter Trains hauling thousands of people to City Hubs even after COVID-19 because of work at home/Telecommuting

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Posted by CSSHEGEWISCH on Wednesday, October 21, 2020 10:01 AM

Any number of suburban business districts were gutted by the development of shopping centers beginning in the late 1950's.  Downtown Hammond, Indiana is an example with which I am quite familiar.  Walmart ("We sell for less")and other big box discounters have done a number on many small city and small town businesses.

The daily commute is part of everyday life but I get two rides a day out of it. Paul
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Posted by JoeBlow on Sunday, December 13, 2020 8:16 AM

Transit ridership will come back over the next few years. Why?

The value of face-to-face (FTF) interactions taking place in a central location is priceless and cannot be replaced by work-from-home (WFH). This an important factor in any job including office jobs that can be done remotely. When problems or questions arise going to the person responsible in a physical office is a lot easier and quicker. 

My company tried WFH at the start of the pandemic with the following results. Emails went unanswered, essential reports were turned in with errors and a number of employees had constant connectivity issues that were never fully fixed. Productivity and work quality went down for most employees and the program was cancelled after a few weeks. 

My personal takeaway: WFH is suited to self-starters with the proper equipment and connectivity. How much of the population is self-starters?

 

 

 

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Posted by JoeBlow on Sunday, December 13, 2020 8:44 AM

ATU
I saw this a few years ago in Metra CNW  Ogilvie Transportation Center from when I visted in the late 1980s to 2010s. In the 1980s there were thousands of Comodity Traders and related staff and finace folks jamming the trains at rush hour and today it is a trickle of what it was as far as I can see on METRA.

 

A lot of the in-person security trading jobs (futures/stock) have been automated with algomerithic trading (super computers running turbocharged trading programs).

Others are now done in suburban offices by professional traders executing trades through Bloomberg terminals for people who do not or cannot manage their stock portfolios.

Finally, add in all of the individual DIY investors purchasing 10 shares of UP or 20 shares of GE through discount brokers like Etrade without ever having to speak another person.

As professional trader, managing other peoples portfolios is a lot easier from a surban office near my home. 

As an individual DIY invester, executing trades online is a lot cheaper, or free, compared to calling another person. 

Compare the NYSE floor in 2000 with with today and you can see the decline in open call trading. In 1995, buying 10 shares of UP would have cost me $30. Ten years later it would have cost me $15. Today, it cost nothing. 

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Posted by gregc on Sunday, December 13, 2020 11:26 AM

JoeBlow
Transit ridership will come back over the next few years. Why?

The value of face-to-face (FTF) interactions taking place in a central location is priceless and cannot be replaced by work-from-home (WFH).

doesn't it depend on the industry and attitude of employees?

before i retired as an engineer, i was often on conference calls with San Diego, India and Israel

obviously some industries require person to person contact (e.g. nursing).   others (e.g. sales) need to be able look a person in the eye.   some depend on collaboration which is less about trust and more about information.

the success of working from home depends a lot on the employee to work independently and being responsible to get the work completed correctly.   i don't believe all employees can be trusted to work from home, as well as all managers being able to trust their employees.   i really requires teamwork

so those companies with employees having the right characteristics can do more WFH while other won't be as successful.

 

in general, i think more companies wil adopt WFH to a greater percentage.   this will reduce commuter traffic and business travel as well as allowing employees to live further away from the company offices.   one big benefit is employees spending more time on the job and less time commuting.    it will also allow companies to hire skilled employees who live distantly.

perhaps there was a much greater % of WFH and video conferenceing before covid than we realize.

it will take time.  but i thought the same would have happened when i saw video conferencing 20 years ago at AT&T

greg - Philadelphia & Reading / Reading

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Posted by CMStPnP on Sunday, December 13, 2020 3:29 PM

People / Employees change over time as well.   The Employee you hired a year or two ago might not be the one you want or need this year.   Maybe they get a sudden illness that is debilitating that can be masked at home but not via an office visit.   Maybe they just get lazy and their productivity heads South.    It's true that some of that stuff can be caught remotely but some of it is a lot easier to spot when you can watch them work.

Where I worked we have already discussed the future workplace and it looks like it is going to be mobile office type deal and that we will be required to spend a week in the office every so much of an elapsed period of time and it will be corrdinated so that everyone on the team is in the office that week.   During that week we will schedule collaborative meetings, evaluations, and have a team building day where we go out for lunch or dinnner.     Sounds pretty cool and that was pretty much what I was doing as a remote employee prior to the pandemic.   On site for a week, once every 5-6 weeks.   Difference with me being in another city was that one week was spent in a hotel.    Whereas other local employees closer to home it would be a normal workday and they would just drive into the office.

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Posted by charlie hebdo on Tuesday, December 15, 2020 7:06 AM

CMStPnP:  What you describe seems to jive with what I hear anecdotally from folks based in Chicago,  Houston,  LA, Seattle and Eugene.  Whether or not their previous mode returns sometime in 2021 is the question. It sounds like it will only in part. 

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Posted by CMStPnP on Tuesday, December 15, 2020 11:32 AM

charlie hebdo

CMStPnP:  What you describe seems to jive with what I hear anecdotally from folks based in Chicago,  Houston,  LA, Seattle and Eugene.  Whether or not their previous mode returns sometime in 2021 is the question. It sounds like it will only in part. 

Oracle in it's recent move of HQ to Texas is offering it's employees similar.   They can stay behind in California and become remote employees or move with the company to Texas.    Whatever they want to do.    Their choice and by offering the choice,  I'll bet you that Oracle is escaping massive employee relocation costs.   Their former offices in California will become a regional support center.   Elon Musk likes Houston I think because of the proximity to NASA and his desire to concentrate on Space innovations in the future (also a faster flight to White Sands, NM).     I think that was his underlying motivation to move here but he blames California publicly.

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Posted by JPS1 on Tuesday, December 15, 2020 11:39 AM
It is not just office workers that can work remotely.  In the electric energy industry, field reps do likewise.
 
In olden days service reps fanned out daily from distribution centers to meet with customers about their energy needs.  Now most of them work out of trucks that are home based.  They may go to the distribution center once a week for meetings.
 
Mobile computing made it possible.  Field obtained data regarding a job is uploaded to a central computer, which opens a job order, and ultimately completes the process of planning the job. 
 
Brand new?  Nope!  We implemented the technology and business processes 20 years ago. 
 
The pandemic is likely to accelerate the trend of working remotely.  What ultimate impact it will have on transit systems is unknown, but if I were a planner, I would put a hold on any major transit projects until the future can be seen more clearly. 
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Posted by Flintlock76 on Tuesday, December 15, 2020 4:54 PM

CMStPnP
 Elon Musk likes Houston I think because of the proximity to NASA and his desire to concentrate on Space innovations in the future (also a faster flight to White Sands, NM).     I think that was his underlying motivation to move here but he blames California publicly.

Whatever his reasons are, and only he knows what they really are, it's certainly cheaper to do business in Texas than it is in California.  

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Posted by CSSHEGEWISCH on Wednesday, December 16, 2020 10:05 AM

I find the irony of Musk's move to be quite amusing.  Taxes are low in Texas because of the oil royalties paid to the state and Musk's electric vehicles are intended to reduce oil consumption.

The daily commute is part of everyday life but I get two rides a day out of it. Paul
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Posted by Overmod on Wednesday, December 16, 2020 1:27 PM

CSSHEGEWISCH
I find the irony of Musk's move to be quite amusing.

Ask Musk how his guarantee of free recharging worked out in the Netherlands.

His grasp of longer-term consequences, let alone common externalities, often seems a bit lacking ...

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Posted by JPS1 on Saturday, December 19, 2020 9:47 AM

CSSHEGEWISCH
....Taxes are low in Texas because of the oil royalties paid to the state.........

Texas total individual tax burden, i.e., state property, sales, and income taxes, places it 32nd compared to the other 50 states according to a study by Wallethub. 
 
The total individual tax burden in Texas in 2020 is 8.20% compared to the highest rate of 12.28% in New York and the lowest rate of 5.16% in Alaska.  Texas has the 9th highest property tax and sales tax rates, but it does not have a personal income tax, which tends to benefit wealthy people like Musk.
 
The median tax burden is 8.47%, with a standard deviation of 1.36%.  Texas is within one standard deviation of the median state tax burdens.    
 
Although Texas does not have a personal income tax, it has a gross margin tax on businesses.  It behaves like an income tax, but no one here dares call it that.  So, it is called a franchise tax.  There are several ways to calculate the tax.  The most common is to apply the rate, which is .75% of 100% of total revenues minus the cost of goods sold, which is the first step in computing net income.  Musk’s business enterprises would be hit by this tax, which ultimately would be passed through to the folks that buy his company’s products. 
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Posted by Overmod on Saturday, December 19, 2020 11:40 AM

JPS1
Although Texas does not have a personal income tax, it has a gross margin tax on businesses.  It behaves like an income tax, but no one here dares call it that. 

In my experience, most states that have the 'populist' reduction on personal income taxes tend to be more savage about soaking businesses, particularly small businesses that cannot develop effective deductions or avoidance strategies, for the foregone revenue to do social-program funding.  Perhaps the canonical example of this was Huey Long in Louisiana, who started after the oil business but wound up finding much more.

JPS1 is of course far more experienced and educated with respect to this than I am, and he might mention the various kinds of business taxation (and deductions therefrom) that typify some of these states.  (This specifically including corporate property taxation to benefit public schooling, especially in states with "state lotteries" that putatively benefit 'education'.)

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Posted by Erik_Mag on Saturday, December 19, 2020 2:42 PM

JPS1
Although Texas does not have a personal income tax, it has a gross margin tax on businesses.  It behaves like an income tax, but no one here dares call it that.  So, it is called a franchise tax.

Very similar to a "Value Added Tax" (VAT). European rates can be as high as 15%, so sounds like Texas is applying a light touch with the 0.75% rate. I assume the state legislators are smart enough to realize that too high of a rate can be counterproductive. A significant difference is if labor costs can be deducted, which apparently not true with a VAT.

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Posted by charlie hebdo on Saturday, December 19, 2020 4:02 PM

VATs are passed on to the ultimate user. 

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Posted by Overmod on Saturday, December 19, 2020 4:35 PM

charlie hebdo
VATs are passed on to the ultimate user. 

But isn't that practically true of any tax imposed on a producer?

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Posted by charlie hebdo on Saturday, December 19, 2020 7:13 PM

Corporate income tax may be passed on depending on price elasticity and competition.  VAT is pretty much always passed on but it is listed on receipts as a separate item. 

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Posted by prk166 on Friday, December 25, 2020 7:23 PM

 

By and far the #1 revenue source for the CTA are taxpayers.  They bring in @30% more revenue from government subsidy for their operations than they do tickets.  As long as that money isn't seriously affected, they'll be able to continue operations.

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Posted by JPS1 on Friday, December 25, 2020 8:38 PM
For Dallas Area Rapid Transit (DART), according to DART Reference Book 2020, the farebox recovery ratio in FY19 was 13.4%, down from 15.3% in FY15.  The recovery rates differed by mode:  bus 10.1%, light rail 17.4%, and commuter rail 17.7%.
 
The system subsidy per rider in FY19 was $6.50.  The subsidies were bus $6.90, light rail $5.20, commuter rail $5.08, paratransit $45.55, and vanpool $.48. 

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