The production and distribution of goods is an integral part of the region’s economy, requiring dedicated expanses of land in order to meet the needs of businesses and consumers. This land is an essential resource for a prosperous economy and an important part and source of tax revenues for many communities. The goal of the DVRPC Freight Centers inventory is to identify and categorize these key locations to enhance planning necessary to concentrate growth, invest in appropriate transportation infrastructure, and minimize conflict with host communities.
1. Defining Freight Employment
Greater Philadelphia is home to over 430,000 business establishments employing over 3.1 million individuals. The story of freight centers starts with these employers. The role that each business plays in the regional economy influences the movement of goods and services and informs the patterns of freight-related development.
We can understand the role of businesses when they are grouped into industry subsectors based on the type of economic activity. To illustrate this we can portray each of the region’s 97 industry subsectors as circles, scaled by it's regional employment.
Employment by Industry Subsector
Source: 2013 NETS and 2016 Bureau of Labor Statistics
What is freight employment?
Not all of these industries rely on freight to an equal degree. The goal is to identify industries that are freight-intensive, meaning that the industry in question generates or attracts large amounts of freight trips or movements.
Freight-intensive Industries
Identifying freight-intensive industries is done by associating each industry subsector with a segment of the economy’s product lifecycle. We can break this lifecycle and the related industry subsectors into four distinct groupings. Industry subsectors that are associated with Extraction, Production, or Distribution are considered freight-intensive.
Freight-intensive
Extraction
Production
Distribution
Consumption
Industry Classifications
Extraction
These industries are involved in the extraction of raw materials from the earth and/or the raising of animals and crops. These industries represent a small but important part of the regional economy.
The region has approximately 12,600 employees working in extraction industries grouped in the following subsectors:
Production
These industries are the makers of finished goods and consumer products. They are responsible for the production of the goods. Their operations have a critical reliance on the freight transportation system to deliver the necessary inputs and get their outputs, or final products to market.
The region has approximately 450,000 employees working in production industries grouped in the following subsectors:
Distribution
These industries serve as the vital link between the various components of the supply chain. Their business is the conveyance and storage of freight.
The region has approximately 210,000 employees working in distribution industries grouped in the following subsectors:
Consumption
These industries are primarily consumers of finished goods. While they can be major attractors of freight, they are not considered core to the development of freight centers. These industries heavily rely on goods and services provided by the other three groups. These industries and their needs are addressed through urban freight planning in commercial corridors and towns and rely heavily on goods and services provided by the other three groups.
The region has approximately 2.4 million employees working in 51 consumption subsectors.
Together Extraction, Production, and Distribution industry groupings represent the primary freight-intensive industries of the region. The total employment across these industries is approximately 675,000 or 22% of regional employment.
Employment by Industry Subsector
Source: 2013 NETS and 2016 Bureau of Labor Statistics
While the share of employment in these freight-intensive industries is lower than consumption industries, average annual wage is often higher.
When charted by average annual wage we see that many freight-intensive industries have a higher average annual wage. Additionally, these freight subsectors are often "family sustaining," having a average annual wage greater than the region’s living wage for a family of three.
Average Wage by Subsector
Establishments
Employees
Average Annual Wage
Establishments
Employment
Average Wage
Employment by Industry Subsector
Average Wage by Subsector
2. Where is freight activity in the region?
Understanding the geographic distribution of freight in Greater Philadelphia is key to identifying the region’s Freight Centers.
While freight employment is a key factor in identifying freight activity, understanding the regional freight economy’s distribution requires additional metrics to help identify key clusters of activity.
Let’s explore the spatial distribution of several key indicators that help us to predict the level of freight activity throughout the region.
Analysis Criteria
Freight-intensive Establishments
The distribution of freight establishments in the region provides a starting point for cluster analysis. These highlight the locations where there are many establishments located in proximity to each other.
The distribution of freight employment using establishments can give unnecessary weight to a location with many small businesses that have relatively little freight activity associated with them.
Freight-intensive Employment
The distribution of freight employment using number of employees helps us to better understand the relative intensity of freight activity in each zone. More employees working in freight industries would indicate a higher probability for freight generating activities.
Employment, measured as establishments or employees, is just one type of measure for understanding the freight economy in the built environment. These numbers may miss some key freight generators due to incomplete data or activity types. To fill these gaps we can look at the distribution of existing land uses, industrial buildings and intermodal freight facilities.
Freight-related Land Uses
Evaluating the percent of each analysis zone that is dedicated to freight-related land uses reveals additional locations in the region that may contribute to the freight economy though no single employer is reported at that location.
Key freight-related land uses include industrial, mining, utility, and transportation. These land uses help us to identify locations of freight generators that may not have fixed employment or a business establishment assigned to that specific location.
Industrial Development
In addition to land use, the physical industrial structures both built and proposed in the region can be used to understand the potential for freight activity.
Using commercial real estate data, the distribution of square footage of occupied and proposed industrial buildings throughout the region can be mapped.
Intermodal Freight Facilities
The final consideration in identifying freight generating activity was the inclusion and analysis of intermodal freight facilities. These freight facilities handle the transfer of goods from one mode to another and are significant components of the freight system.
These facilities are not only responsible for the generation of freight trips but also serve to attract freight-related business development. Proximity to these locations was analyzed to understand their spatial distribution and potential impact on adjacent analysis zones.
Freight Quotient
Aggregate scores were created for each analysis bin using the evaluation criteria results, weighted by level of impact. These provided a quantitative predictor for freight activity across the region. This predictive measure, the Freight Quotient (FQ), provided a foundation for more detailed localized analysis.
The FQ measures highlighted the hotspots in the region, shown as circles on the map, that required further analysis. Detailed evaluation was conducted at the parcel level to assess employment, development, and building characteristics. This allowed for the identification of clusters of parcels that met the necessary levels of activity to be potential freight centers, highlighted by the bold blue circles.
DVRPC Freight Centers
The final result of the FQ analysis and evaluation of the potential freight centers identified the final set of Freight Centers in the region.
These geographies are the foundation of the final step in the identification process, the classification of centers.
3. Classification of Freight Centers
The core function of Freight Centers is to provide a better understanding of the land use and economic development patterns as they relate to freight activity in the region. The classification into specific typologies provides another layer of detail to that designation.
Creating Freight Center typologies can help planners, decision-makers, and other users to better understand transportation infrastructure requirements, land use/land development patterns, building types, employment characteristics, and potential community impacts that may exist at each freight center type.
Typologies Overview
An analysis of each of the freight centers, grouping them by economic, transportation, and development activity resulted in classification into five typologies:
International GatewayHeavy IndustrialDistribution & LogisticsHigh Tech ManufacturingLocal Manufacturing & Distribution
Typology Profiles
International Gateway
An International Gateway Freight Center is a core node in the regional and national goods movement system and serves as a connection to global markets. These centers are focused around a single or multiple air or maritime or port facilities.
Employment and Development
directly related to supporting trade and distribution of import/export goods through the related port terminal(s)
Building Size and Distribution
often varied but commodity specific, related to import/export activity
Heavy Industrial
A Heavy Manufacturing Freight Center is a node focused around heavy industrial land uses involved in the manufacturing of goods. These centers are served by freight rail access and often have additional access to a port terminal allowing for the movement of bulk or break-bulk source materials.
Employment and Development
focused around manufacturing and production sectors
Building Size and Distribution
highly dependent on manufacturing processes but often includes dedicated power plants, old industrial buildings, and tank farms
Distribution & Logistics
A Distribution and Logistics Freight Center is a node with a high concentration of regional and national serving distribution and logistics businesses. These centers are often located around key highway interchanges with access to both port gateways and consumer markets.
Employment and Development
primarily third-party logistics providers, national retail chain warehousing and distribution, e-commerce fulfillment centers, as well as supporting services, such as truck service, tires, and leasing
Building Size and Distribution
a combination of large footprint and/or high ceiling modern warehouses as well as small footprint cross-dock facilities
High Tech Manufacturing
A High Tech Manufacturing Freight Center is a node focused around advanced manufacturing land uses and businesses. These centers rely less on major freight rail and maritime facilities but are well located relative to highway facilities.
Employment and Development
primarily in bio-pharmaceuticals, electronic components, advanced chemical manufacturing, with a mix of research and development activity
Building Size and Distribution
often small footprint, flex buildings with an occasional mix of office facilities and residential development in close proximity
Local Manufacturing and Distribution
A Local Manufacturing and Distribution Center is a node focused around locally serving small manufacturing and distribution facilities. These are less dependent on prime location near interstate interchanges, but are well served by smaller highway facilities and proximity to consumer populations.
Employment and Development
primarily in local food and beverage distribution, building and contractor supply, and small scale manufacturing
Building Size and Distribution
often comprised of densely developed, smaller footprint warehouses and industrial facilities
Making Use of Freight Centers
The identified Freight Centers are intended as a planning tool to help DVRPC and regional partners better understand the priorities, challenges, and opportunities created by these important regional centers. The Freight Centers will be utilized in a variety of DVRPC activities and continually updated to provide a clear picture of the regional freight economy.
Highlights of these efforts include:
Inclusion of Freight Centers in the Long-Range Plan
Utilization of Freight Centers in the TIP/Long-Range Plan Project Evaluation
Development of a Regional Freight Model
Creation of Freight Center Profiles with tracking of key data metrics and infrastructure requirements.
