The global economic situation has gone from bad to worse ever since lockdown started due to COVID-19. Even though the majority of people are working from home, there are some industries that can’t work like that. Transportation is one such industry that has been badly affected due to the lockdown. It is time we consider the importance of transportation and how it contributes to us as consumers and in the economy as a whole.
Transportation facilitates the movement of people and goods across large or short distances. There are three main means of transport which are land, water, and air. Different vehicles are used to tap into either of these means. Transportation is not something that is easy to come by. The only reason it seems easy is that we have embedded it in our lives. In reality, robust infrastructure needs to exist in order to facilitate transportation. It has become an integral part of our lives and we can’t imagine our lives without it. The importance of transportation is so huge that it impacts every sector of our lives and the economy.
Importance of transportation in our personal lives
Transportation has a host of uses in our daily lives and they are all interconnected. To travel to work and back every day, we require some form of transportation. The fruits and vegetables that we consume are not grown right next to our houses. They have grown in farms far away. The produce is then transported to cities and homes. All the goods that we use around us have components built in different places. All these components need to be assimilated and then brought to our homes. We order things online that are delivered right at our doorstep. This requires a lot of logistical planning and transportation. Transportation is important for the movement of materials and people.
Thanks to the availability of reliable transportation, the world has become an extensive marketplace. Everything is now available everywhere, regardless of what continent or country you live in. Earlier, there were just local marketplaces where produce from nearby regions could be sold. Now, someone sitting in the United States can enjoy Kiwis grown in New Zealand. This is a huge paradigm shift from earlier. This highlights the importance of transportation in international trade.
Transportation allows the movement of goods from the place of production to the place of consumption. Moreover, it has allowed companies to produce different parts in different places and assemble the final product somewhere else. This has enhanced the financial efficiency of the functioning of companies.
People not living in metropolitan cities or living in remote areas now have the same access as everyone. In fact, without transportation Metropolitan cities would not have come to exist at all. Transportation has allowed trade between nations which has further interlinked the economies of the world. Since the advent of air travel, the market place has become even more extensive.
Earlier countries could only trade with other countries with whom they shared land borders. Trade via shipping routes through the sea was an option only available for countries with a coastline. Now, borders are just lines on the ground thanks to air travel. Any country can trade with any other country regardless of the fact that they share borders or not. The importance of transportation by air is insurmountable for trading between countries that don’t have a mutual land border.
Movement of Labor
The importance of transportation in the movement of labor deserves a special mention. In a vibrant economy, capital and labor must mix freely. Good transportation has allowed labor to travel to destinations where jobs are available. It allows people to travel away from their local area in search of better job opportunities. People can travel to different cities in search of their ideal job. People can even travel to different countries in search of better job opportunities. This is especially relevant since some countries have surplus labour while others don’t. Moreover, certain jobs require a lot of qualified individuals who may not be available locally.
Without transportation, it would be impossible for companies to cover up labor deficiencies. There is no ideal zone anywhere in the world where all the type of labor needed is available. Transportation facilitates the setting up such zones where all kinds of labor are available. Certain professions may even require seasonal inputs of labor and in such cases, transported labor is the only option. A lot of labor-intensive jobs would be impossible to perform without transportation.
Large Scale Production
Large scale production of goods would be impossible without transportation. Most of the goods that we use fall under the category of mass-produced goods. These goods production is done in large quantities at certain locations in the world and shipped to the rest. This model would cease to exist without transportation. In large scale production, the consumers of the product are far and wide while production is only at a few places. The finished goods must be shipped al over the world to the consumers from the site of production. Ensuring that the goods reach consumers is the main importance of transportation in large scale production.
For large scale production to succeed, a lot of input is required in terms of materials. All these materials will not be available at one place. The pre-requisite materials for producing a finished product need to be shipped to the site of manufacture. The manufacturing site depends on the availability of raw materials. Still, all materials will not be available. Another importance of transportation is that it allows the movement of raw materials to manufacturing sites. The goods are then shipped from the manufacturing sites to the consumers.
It is important to note that the finished product is not directly shipped from the manufacturing site to the consumers. There are various intermediaries that the goods must go through. Transportation allows the movement of the goods through all the intermediaries and to the final consumer. Transportation has allowed companies to centralize their production lines. Without it, locally producing all goods based on local demand would not be feasible.
Stability in prices
It is a common observable norm that goods produced locally are cheaper. Locally produced goods are cheaper in the local markets since there is lesser transportation cost involved. This means that the manufacturers save money with the reduced transportation and this they pass on to the consumers. In distant markets, goods are costlier since there is a higher transportation cost involved. If it wasn’t for transportation, goods would only be available locally. Distant markets would never even get to see those goods. An efficient transportation system allows goods to be available even in distant markets at reasonable costs.
Another importance of transportation in the stability of prices is that it allows seamless transfer of goods. Goods that are surplus in one area may be deficient in another area. Thanks to transportation, goods can be sent from surplus regions to where there is demand. This brings about relative stability in prices. Otherwise, goods in surplus would have to be sold at cheaper rates since the demand is low. Goods that are in high demand would have to be sold at higher prices. This is because there are not enough goods for everyone’s needs. Transportation, however, allows these prices to remain stable by ensuring that the supply is as per the demand.
We have seen a gradual shift of the population from rural areas to cities. This means that the workforce is now more centralized than ever. The shipping of goods is done based on where the demand is. There is a lot of choices available for the modern consumer. The modern consumer can pick the product that’s best for them from a variety of options. This ensures that the consumer gets what they want and it is the importance of transportation in the economy. The consumer will buy what they want and hence the producers must tailor their products as per demand.
Transportation is a huge benefit for consumers. Earlier, consumers had to rely on local products regardless of the quality. Since local vendors had a monopoly over the market, they charged arbitrarily high prices. The consumer never got any value for money. Now, thanks to transportation the same product made by different companies is available. The consumer can pick whichever one they prefer. The prices have also gotten more regulated since companies must price their product competitively. Without this, the consumer may opt for a competitor’s product.
There is a huge importance of transportation in logistics. This is because it allows the movement of goods and allows them to reach consumers. The consumers are now getting a lot of options thanks to an efficient logistics chain. Transportation has also given consumers access to newer products that were inaccessible to them earlier.
There is another importance of transportation in business that we cannot ignore. That is the creation of jobs and employment opportunities. No doubt transportation and logistics are on the rise. Consumers are demanding more and more products which companies rare happily supplying. To bridge this gap between demand and supply, the transportation sector must step up. The transportation sector needs to ensure that the products being rolled out by companies reach the intended consumer. This has created a lot of job opportunities in the transportation sector.
To keep the transport machinery running, there is a high demand for manpower. Drivers, pilots, and sailors are needed to man vehicles across all three modes of transport. Moreover, to manage their movement there is a lot more requirement of manpower. To plan the logistics of the loading and offloading, there is a requirement of more people. As you can see, there are a lot of opportunities from the operational aspects of transportation. Since transportation facilitates the setup of centralized units, jobs in such units depend on transportation too. This is another importance of transportation infrastructure. Overall, there are millions of jobs that are reliant on transportation and the allied sectors.
Transportation has enabled agriculture to develop by leaps and bounds. Earlier agriculture was done in small fields on a local scale. Now agriculture is done on large swathes of land on an industrial scale. Earlier, manual labor did all the work but now industrial machinery is used. Transportation has allowed agriculture to become significantly profitable. Farmers can now sell their produce far and wide. Earlier, farmers only sold in local markets where there was already a lot of supply of the same product from the entire region. Now, farmers can ship their produce to where there is higher demand and sell it at a higher price. This allows them to get better margins.
Transportation has allowed farmers to cultivate large swathes of land and grow crops for cities. Earlier, the crop growing regions were close to the demand centers. Now, the crop growing regions are hundreds of kilometers away. There is no cultivation of crops within cities. Hence, rural areas must grow more crops to supply food to the cities. In fact, products from different countries can now reach places where the demand is higher. This has promoted the exchange of indigenous food items amongst different countries. Hence, this transportation of food items has also led to cultural exchange.
Industrial development cannot occur without transportation. Industries are centralized zones of products that cater to the demands of consumers far and wide. To establish such centralized zones of production, a lot of transportation is required. Labour needs to be transported to the location of the industry. Industries typically require a lot of input and are labor-intensive. It is impossible to source all this labor locally. Raw materials need to be shipped from different regions to the location of the industry. Without raw materials, industries cannot function.
Once the industry is done with making the products, the products need to be shipped to the consumers. These consumers are spread far and wide and robust transportation is needed to ensure that the goods reach them. Moreover, for industries, a stable network of transportation needs to be maintained. This is because the goods generated by the industries need to be shipped simultaneously. Otherwise, industries will have excess inventory, and the consumer demand is not satiated.
Transportation is the lifeline of a country and its economy. A country’s progress is gauged by its transportation infrastructure. Transportation plays an important role in our personal and professional lives. It is because of transportation that the modern societal structure can exist.