Thanks to ongoing advances in energy-saving technologies, the chart above shows the significant increases in the energy efficiency of five common home appliances based on historical data that were just released by the Association of Home Appliance Manufacturers (AHAM) for the years 1981 to 2011. Those improvements in energy efficiency translate into significant energy cost savings for American households. According to a press release from the AHAM, US consumers could save $90 per year on average if they replaced their 10-year old refrigerator, clothes washer, and dishwasher with today’s energy efficient models. The savings from lower operating costs would be even greater when comparing today’s modern models to the appliances of 20 or 30 years ago.
The energy efficiency of appliances is measured by their “energy factors,” which are standard industry and government metrics that are used to measure an appliance’s overall energy efficiency. For example, the energy factor (EF) of a clothes dryer is defined as the number of pounds of clothes dried per kWh of power consumed. Definitions of the energy factors for other appliances can be found here.
In 1981, the energy factor of a typical home refrigerator was 5.59, and by 2011 the EF increased more than three-fold to 15.50, for a 207% improvement in energy efficiency in the last 30 years (see chart). The other four home appliances tracked by the AHAM also had significant improvements in energy efficiency since 1981 based on the increases in their EF ratings. Compared to 1981, the energy efficiency of the average room air-conditioner has increased by 46%, today’s freezer is 65% more efficient, and modern washing machines and dishwashers are more than twice as energy-efficient.
As one example of how technology has improved the energy efficiency of appliances, today’s dishwashers consume less than half the energy of the 1981 dishwasher because of technological advances in soil sensors that minimize water usage, and the increased use of stainless interiors that accelerate drying time.
If the energy efficiency of the average dishwasher more than doubled since 1981, what has happened to its price, measured by the number of hours a typical American factory worker would have to toil at the average hourly wage to earn enough income to purchase a standard model? The time-cost today is only one-third of the time-cost 30 years ago, as the comparison below shows.
In 1981, the dishwasher pictured above from a 1981 Wards Christmas catalog sold for $359.88. The average hourly manufacturing wage then was $7.42, meaning that it would have taken 48.5 hours of work at the average hourly wage for a typical factory worker to earn enough income thirty years ago to purchase the dishwasher above.
The new Frigidaire dishwasher above is currently listed on the Best Buy website for sale at $299.99. At the current average hourly wage of $19.79 for production workers, the average manufacturing worker would only have to work about 15 hours to earn enough income to buy today’s energy-efficient dishwasher, which is less than one-third of the 48.5 hour time-cost for the 1981 model.
Bottom Line: Today’s modern household appliances are not only cheaper than ever before, they are the most energy-efficient appliances in history, resulting in additional savings for consumers through lower operating costs. The average dishwasher today is not only more than twice as energy-efficient as a comparable 1981 model, but its cost today is only about 1/3 the price of the 1981 dishwasher, measured in what is ultimately most important: our time. Put those two factors together, and the average American’s dishwasher today is about six times better than the dishwasher of thirty years ago.
Stated differently, if dishwashers hadn’t fallen in price by a factor of three since 1981, and if they hadn’t improved in energy efficiency by a factor of more than two, Americans today might be paying more than $1,000 for a basic dishwasher instead of $300, and it would take more than twice as much energy to operate. Likewise, we would expect comparable large decreases in the amount of work time required to buy the other four appliances, along with significant reductions in operating costs due to their increased energy efficiency.
See a related post by Don Boudreaux, who does some time-cost comparisons of today’s appliances to those available in 1956, in response to claims by Paul Krugman and others who have described the 1950s as a period of prosperity for America’s middle-class. Don points out that today’s appliances are not only cheaper than the 1956 models, but they are also generally of a much higher quality. Put it all together and American consumers have never been better off when it comes to the standard home appliances that we all own and take for granted. Today’s appliances are cheaper, better, and more energy-efficient than ever before.
Today’s affordable and energy-efficient household appliances are part of the “miracle of manufacturing,” which continues to deliver cheaper and better goods to American consumers year after year, which translates into a higher standard of living for all Americans, especially for lower and middle-income households. If we wanted to identify a “golden era” of prosperity for middle-class America based on the affordability of common household appliances, today’s consumers are many times better off than the consumers of any past decade, including the 1950s that Krugman and others wax so nostalgic about. The “good old days” are now.