How Much Could Repair Save Americans? (Hint: It’s a Really Big Number.)
The debate about the right to repair often emphasizes consumer- vs. corporate rights. But there’s a huge economic argument for repair, according to a new report.
First - welcome to Fight to Repair Weekly and thanks for subscribing. This is my first official post - the first of many, I expect.
If you follow the right to repair issue, you know that much of the debate around right to repair laws takes place on the turf of property rights. It is customers vs. corporations; fixers and tinkerers vs. makers; and property rights vs. copyright. But repair is just as much an economic issue as a legal one. As I’ve said in testimony: repair is actually the rare issue that is pro-consumer and pro-free market and pro environment.
But the economic justifications for repair often get short shrift in news coverage. That’s why, for our first post, I’m taking a look at a recent report out from the folks at U.S. PIRG (the Public Interest Research Group) that came out a couple weeks back and dug into the economic argument for repair with some surprising findings.
This report didn’t get much media attention…possibly because it was released on January 6th and, well…there was some other stuff going on that day. :-P But the report is worth reading and raises important points about the economic cost to ordinary families of not having robust repair options available to them in their communities.
That number? About $300 a year per U.S. household - or around $36.6 billion a year across the 122 million US households.
America’s Costly Electronics Addiction
How did PIRG arrive at that figure? Well, you start with the average American household’s hunger for electronics, which is substantial. PIRG took the average household expenditures from three categories: major appliances, small appliances, and consumer devices to arrive at a rough “electronics expenditure" figure.
The average household expenditure on major appliances was $319 from the third quarter of 2018 to the second quarter of 2019 (a 12-month period). Within that same time frame from 2018 to 2019, American households spend an average of $120 on small appliances.
For consumer devices, PIRG notes that the firm Statista estimated that the average revenue generated per capita was $401 in 2019. With an average of 2.6 people per household in the United States in 2019, that average household spending on consumer electronics was approximately $1042.60.14. Add that figure to the other two figures and you arrive at an average annual spending on electronics is $1,481.60 per household.
Next, there’s the problem of figuring out the benefit of repairing devices versus replacing them. PIRG did that by calculating the average lifespan of a basket of common electronics like smartphones, laptops, refrigerators, and washing machines. PIRG then calculated the average cost of replacing those products (in other words: buying a new product) versus repairing them.
22% Off All Electronics!! (Kind of.)
By dividing the average replacement cost by the average lifespan for each product, PIRG arrived at an average “annual cost of ownership.” They then calculated a second annual cost of ownership that factors in repair: adding the replacement cost of each product with its respective repair cost, then dividing that number by an extended product lifespan.
The result: an estimated total savings of $330.23, per household. In other words, the cost to an average American family of owning electronics is almost a quarter lower (22%) when robust repair options exist to extend the life of electronic products.
The problem, of course, is that robust repair options aren’t available for many classes of electronic devices and appliances. When COVID hit in early 2020, people were forced to stay at home, straining home appliances like never before. (Imagine: 3+ meals a day at home versus 1 or 2). No surprise: the increased use led to increased need for repair. And it wasn’t long before stories started appearing that repair services were in short supply and high demand. Despite that, Bureau of Labor and Statistics data predicts that employment in electronics installation and repair will actually decline by 1% over the next decade.
How does work for installation and repair of electronics decline even though our appetite for electronics is growing by leaps and bounds? I think its clear that industry efforts to constrain repair are part of the picture, as are manufacturers efforts to put up barriers to repair and promote a “if it breaks, throw it away” mentality.
Listen up, legislatures
I think this economic argument is a really important one for legislators to grasp as they weigh proposed right to repair legislation in state legislatures this year. (More on that in future editions of the newsletter.) PIRG points out the obvious in their report: fostering a robust repair economy is not only beneficial for consumers to the tune of hundreds of dollars a year. It also is good for the economy overall: creating blue- and pink-collar jobs paying middle class salaries for graduates of U.S. high schools and community colleges. As BLS points out: the Median Pay for professionals working in Electrical and Electronics Installation and Repair was $59,080 per year ($28.40 per hour) in 2019. Companies like Apple, Samsung and John Deere that seek to constrain repair are essentially driving up costs across the U.S. economy and - cynically - offering cheap foreign labor (making new phones in a Foxconn factory in China, say) in exchange for well-paid jobs that can support a family and community here at home.
That sounds like a bad deal to me and one manufacturers and original equipment makers (OEMs) should reconsider. I hope lawmakers sit up and take notice, as well.
I’d love to hear your comments! Take a minute to leave your thoughts below.