Economic Problems Caused by the Use of Cellphones

By Luke Arthur

The invention of the cellphone opened up many new areas for growth in the economy. At the same time, it also had a negative impact on many aspects of the economy as a whole. As with every important innovation, there are benefits and costs of the technology, and with cellphones users must deal with some of negative consequences.

Cellphone Bills

One of the ways that cellphones negatively impact the economy is by allowing users to earn large cell phone bills easily. According to CNN Money, eight out of ten people do not use the features that they pay for on their cellphone plan. The average user overspends by an average of $300 per year on cellphone bills. Because a majority of people in the United States now have cellphones, of course this negatively affects many people by giving them less money to spend on other items, which hurts the economy as a whole.

Car Insurance Rates

Another way that cellphones can negatively affect the economy is through auto insurance rates. Auto insurance rates are partly based on the number of accidents that the insurance company predicts it will have to pay for. According to a study by the National Safety Council, 28 percent of auto accidents are caused by cellphones, which adds many accidents to the total and forces insurance companies to charge more for insurance premiums. This lowers the amount of expendable income that people have.


With the advancement of cellphones in society, land lines have taken a major hit in recent years. According to the National Center for Health Statistics, nearly 25 percent of all homes use a cellphone instead of a land line. Considering that most of these homes had a land line in the past, this means that land lines are being removed, which negatively impacts the companies that offer them. This has cost many employees their jobs and has led to the decline of many land line providers.

Family Life

Another way that cellphones have negatively impacted society is by infiltrating family life. According to a study by the University of Wisconsin-Milwaukee, people who use cellphones are more likely to allow work to spill over into family life. This decrease in free time gives people less time to go out and spend money with their family members. When less spending is involved, it will negatively impact businesses, which then negatively impacts the economy overall.