Bypass Strategies are a success

 Interviews with 115 Kempsey business owners have revealed that less than half the anticipated number of jobs have been lost from the local economy since the opening of the Pacific Highway Bypass in March, 2013.

The research project was commissioned by Kempsey Shire Council to assist with measuring the impact of the bypass on the local job market, and compares favourably to pre-bypass job loss projections.

Interviews were conducted with businesses located along the former Pacific Highway corridor at South Kempsey, the Kempsey CBD and Frederickton over a four-week period during November last year by Dr Bruno Parolin of UNSW Consulting. Dr Parolin is widely experienced in this area of research, having previously examined the economic impacts of bypasses on many Australian cities and towns including Goulburn, Yass and Berry.

Kempsey Shire Council’s Manager, Economic Sustainability Susannah Smith said the research provided Council with evidence of job loss to support and further refine its Bypass Strategy.

“Obviously we are very keen to continue to fine-tune our mitigation strategies and take advantage of emerging opportunities and this research will greatly assist our efforts,” Ms Smith said.

The new research differs markedly to a the projections of an Environmental Assessment report commissioned by the former Roads & Traffic Authority (now Roads & Maritime Services) in 2007 study. The 2007 study was also based on interviews with Kempsey businesses, as well as passing motorists, and predicted 176 jobs would be lost as a direct result of the opening of the bypass.

By comparison, the 2013 post-bypass study reveals the actual net job loss is a much lower 74 jobs.

Unsurprisingly, most jobs have been lost from businesses directly servicing the needs of motorists, including eateries, service stations, food stores and other retail stores. The accommodation sector was found to be not affected in the same way or to the same extent.

“A total 94 jobs have been lost from 34 businesses, however there have also been 20 new jobs created at six local businesses as a direct result of the bypass, which leaves a net job loss of 74,” Ms Smith said.

“The estimated combined loss of income from reduced staff work hours and loss of jobs is in the order of $71,547 per week, which corresponds to 2% of estimated total weekly personal income in Kempsey based on the 2011 Census.”

Business owners were asked to complete a survey and also undertook a face-to-face interview with Dr Parolin, which focussed on changes in employment, annual turnover, wages and salaries, business adjustments due to the bypass opening, and perceptions of the impact of the bypass on the broader Kempsey economy and lifestyle.

Gross annual turnover is estimated to have decreased by between $14.6-17.3M a year, or a loss of about 12.4% of the total gross annual turnover for 2012 as reported by the 115 businesses surveyed.

Allowing for inflation, this figure is $6-7M less than what was predicted in the 2007 RTA study.

Of the 115 businesses surveyed, six – including 3 take-away establishments, 1 food store, 1 caravan park and 1 homewares/hardware store – reported an increase in turnover.

Most jobs lost have been casual or part-time, with 62 women affected compared to 32 men.

Half of the businesses interviewed that reported a decrease in turnover (34 out of 68, or 50%) opted to reduce staff hours or absorb the downturn rather than reduce staff hours or shed staff.

About half the businesses experiencing a downturn in trade also reported making changes to their business operations, including increasing advertising and promotions, diversifying product lines, and reducing operating times.

Just two employed web-based strategies.

In relation to business perceptions, 54.9% of businesses interviewed perceived the economic impact of the bypass had not been positive. A higher number of 73.9% did, however, believe the bypass had made Kempsey a better place to live (interestingly, half of these businesses were adversely affected by the bypass.

“There is definitely a widespread belief among businesses that the diversion of through traffic from the town has had positive environmental effects as a result of the reduction in noise levels, particularly from heavy traffic, as well as pollution and dust levels, and that the main street has become safer for pedestrians,” Ms Smith said.

“Businesses also expect that these positive effects will progressively enhance the quality of the town centre as a place for shopping and service provision for local residents as well as making it more attractive as a stopping place for motorists in the future.”


Kempsey Shire Council,

Media Unit