Additional Coverage:
- Americans aren’t upgrading their phones as often — and surprisingly, it’s hurting the economy (marketrealist.com)
Hold the Phone! Americans Cling to Old Tech, and It’s Hurting More Than Just Your Battery Life
It turns out that beloved smartphone you’ve been clinging to for years might be doing more harm than good – not just for your sanity when apps lag, but for the entire economy! While new, shiny devices flood the market annually, Americans are increasingly reluctant to upgrade, and this trend is raising eyebrows among economic experts.
A recent survey by Reviews.org reveals that the average consumer is now holding onto their smartphone for a whopping 29 months, a significant jump from the 22-month average back in 2016. While this might feel like a win for your wallet in the short term, CNBC suggests that this reluctance to upgrade could be contributing to a weak market, an unhealthy sign for the economy.
Businesses and the Productivity Puzzle
It’s not just individuals. Jason Kornweiss, Senior Vice President of Advisory Services at Diversified, a global technology solutions provider, points out a growing divide between businesses and individuals when it comes to ditching old devices. While employees still crave the latest tech, corporations are often slower to adopt.
A Federal Reserve report highlights the impact: for every year corporations delay upgrading their equipment, productivity dips by approximately one-third of a percent. Further research by Diversified last year found that a staggering 24% of employees are working overtime or staying late due to outdated technology. Even more concerning, 88% of employees report that inadequate tech stifles innovation in the workplace.
Kornweiss explains that the rapid pace of technological change makes it difficult for corporate IT departments to keep up. By the time they vet new technology, something even newer is already on the horizon.
“Businesses establish a shelf-life that is multi-year,” he noted, adding that employees often dread the process of getting a new device from IT. The ultimate cost, he argues, is a significant loss of productivity.
The “Lag” and the Circular Economy
Steven Athwal, CEO of The Big Phone Store, a U.K.-based refurbished device store, believes the issue isn’t device longevity itself, but rather the “lag.” He states, “Businesses and individuals are trying to squeeze modern workloads out of old hardware, heavy processing, rendering, generation, and admin, and that creates a productivity drag.” Slow processors, outdated software, and degraded batteries on older tech, he says, are draining both energy and morale.
While a longer lifespan for devices does benefit the repair and refurbishment market, Athwal points out that this sector is largely “unreported, unregulated, and underutilized,” operating in the shadows. He advocates for greater support from governments and big tech to properly integrate refurbishment, which could transform aging devices into a sustainable circular economy.
Interestingly, U.S. businesses are generally quicker to upgrade their equipment compared to their European counterparts. The Fed’s report indicates that if European productivity had mirrored U.S. investment patterns since 2000, the productivity gap between the U.K. and the U.S. would have narrowed by 29%, with similar improvements for France (35%) and Germany (101%).
So, the next time your old phone starts acting sluggish, remember: it might be signaling more than just a need for a new battery – it could be a tiny cog in a much larger economic machine.