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(Not) workin’ at the car wash

My four-and-a-half year old niece loves going to the car wash. She especially likes that one bit when it splurts multicolored cleaning goo all over the car, covering the windows. She says its like a rainbow.

Car washes have come a long way in 40 years. To get some idea of how far, take a look at the trailer for the 1976 movie, Car Wash

When you arrived at the car wash back in 1976, you’d be met with a swarm of sponge wielding, soap slopping staff. Nowadays, hardly anyone is workin’ at the car wash.

It isn’t too hard to see what happened. First, the technology developed for a totally mechanized car wash. Second, through further innovation, the price of this technology fell. Eventually, it was cheaper for Kwik Trip or whoever to replace the swarm of sponge wielding, soap slopping staff, with one of these mechanized car washes. Where there had been a number of people washing each car by hand, there was now a number of mechanized car washes in various locations maintained by one engineer.

Thanks to technology, each car wash worker was now responsible for many more car washings. This improved productivity allowed prices for car washes to fall as wages for those providing them rose. In 1976, the car wash charged you $3.00 for a wash and wax by machine, $13.08 in September 2018 dollars. Nowadays you can get the elite wash at Kwik Trip for $11, a real terms fall of 16%. Washing a car by hand is such a low skilled job that I did it for my neighbors for pocket money when I was 11. Today, Car Wash Maintenance Technician is a job requiring “a basic knowledge of electro mechanical equipment” and paying upwards of $40,000 a year.

There is a parable here of economic growth. Car washing has become less labor intensive and more capital intensive. This has made both producers and consumers better off.

Ah, but what about the swarm of sponge wielding, soap slopping staff, where did they go?

Other jobs, is the answer. In the month that Car Wash came out, October 1976, there were 79.9 million people on Total Nonfarm Payrolls in the United States. In September 2018, that figure was 149.5 million, an increase of 87%. The Civilian Unemployment Rate was 7.7% in October 1976; it was 3.7% in September 2018. The Civilian Labor Force Participation Rate was 61.6% in October 1976; it was 62.7% in September, 2018.

There may well be far fewer people employed in car washes now than there were when If You Leave Me Now was top of the Billboard Hot 100. But there are more people employed overall, both absolutely and as a share of the labor force. Increased capital intensity has allowed us to economize on the labor used to wash our cars and reallocate it to more productive uses. Anyone warning in October 1976 that the mechanized car wash would lead to mass ‘technological unemployment’ – the familiar worry about robots – has been proved utterly wrong.

I can’t say that a place with multicolored cleaning goo is more colorful than one where Richard Pryor hung out with George Carlin and The Pointer Sisters, but in an economic sense, we are all better off.

John Phelan is an economist at the Center of the American Experiment. 

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