Rail Key to Driving Regional Economic Growth and Achieving Net Zero Ambitions, New Research Reveals

New research from WPI Economics, commissioned by Rail Delivery Group, reveals that the rail industry generated £410m in economic, environmental, and social benefits to North East over the past year, with rail customers contributing £6.5bn through spending in local communities. 

With the rail network facilitating thousands of journeys each day in the region, its impact on the local economy is significant, playing a key role in the productivity of cities and towns in North East. Across the country, the industry directly employs over 103,000 people in varying roles – from station staff and train drivers to underwater divers and seasons delivery managers. 

Unlocking future growth potential in North East 

Beyond its current contributions, the rail industry has significant potential for further growth, boosting the North East and the national economy. According to projections by the Railway Industry Association (RIA), rail travel is expected to grow by an average of 1.6% annually over the next three decades. This would equate to a 20% increase in rail usage by 2035, potentially raising the industry’s contribution from £410m to £580m in North East and to £35bn in Great Britain. 

If rail usage were to increase by 40%, driven by improved services and a growing preference for rail as a sustainable mode of transport, the total value of the rail industry in North East could soar to £780m, significantly benefitting the economic, environmental, and social landscape in the region. 

To make that possible and unlock the potential, it is important the rail industry continues to work together to bolster the attractiveness of rail to customers. Alongside future government investment in infrastructure, future growth also depends on action from the rail industry to improve day-to-day performance; to encourage modal shift through better integration with other modes of transport; make rail accessible to everyone; and continue to make improvements to the overall customer experience.     

Supporting the transition to net zero  

For every mile a person travels, passenger trains produce only around a fifth of the greenhouse gas emissions from the average petrol car. This latest research finds that a 40% growth in rail use is needed by 2035 to shift a minimum of four billion miles from car to train, to achieve the country’s net zero targets in line with the Committee on Climate Change (CCC)’s preferred pathway. For North East, this would mean a 0.02Mt decrease in greenhouse gas emissions and a 3m hours decrease of congestion. 

Customers at the centre of local economies in North East 

Businesses located in and around rail stations are vital to local economies. In North East, rail passengers spend £990m to support local economies when they travel by rail.

As well as supporting local businesses and communities, people travelling by rail are providing a boost to local independent businesses - passengers in North East annually contribute £90m to independent businesses in the region.    

Jacqueline Starr, CEO of Rail Delivery Group said: “The UK’s rail network does more than simply transport us from A to B; it plays a crucial role in driving economic growth by connecting businesses and communities, improving productivity, and supporting the transition to net zero.    

“The creation of Great British Railways is an opportunity for the rail industry to come together and make the improvements that are needed to attract more people to rail, unlocking even greater value for the economy, environment, and wider society.   

“Rail can and must be the backbone of the country’s future growth and environmental ambitions."       

A spokesperson for UKHospitality said: “This insightful report reinforces what we know about the importance of train travel for hospitality and tourism. Trains help bring our customers – domestic and international and our employees to our doors, so we can deliver great experiences and boost economic growth. 

“We are looking forward to working with the rail industry to further grow the opportunities to reach all parts of our nation and spread the benefits of the hospitality sector.”