Hidden Fees and Wasted Time: New Report Shows the ‘Annoyance Economy’ Costs Americans $165 Billion a Year
Today, Groundwork Collaborative released a new report detailing the price of the “annoyance economy,” the hidden costs people pay when companies turn simple tasks into frustrating ordeals. The report, Taking on the Annoyance Economy by Groundwork Policy Fellow Chad Maisel and Stanford economist Neale Mahoney, quantifies how much time, money, and patience Americans lose just trying to get basic things done — from sitting on hold with customer service, to dealing with insurance paperwork, to dodging spam calls and getting hit with surprise junk fees. Meanwhile, corporations profit from these headaches. As the report notes, making it harder for consumers to cancel a subscription can boost corporate revenues by more than 200%.
The Annoyance Economy costs Americans at least $165 billion a year. That includes wading through more than 130 million scam and illegal marketing calls every day and nearly 20 billion spam texts each month. Americans waste $21.6 billion worth of time annually dealing with administrative hassles in health care alone, like waiting for doctor appointments, with nearly 80% of Americans reporting frustration with burdensome insurance paperwork and coordination.
By draining money, time, and energy, the Annoyance Economy amplifies the cost of daily life and hits families hardest who are already stretched thin. As Americans grapple with an affordability crisis, the Trump administration has taken actions that have allowed the Annoyance Economy to flourish. Between scrapping a regulation requiring airlines to refund delayed flights, repealing the Consumer Financial Protection Bureau’s overdraft fee protections, and cutting enforcement resources at agencies policing scams and abusive corporate practices, Trump has completely abandoned consumers in favor of corporations. The report contains proposals to strengthen consumer protections and return time and money to consumers.
In the paper, the authors write:
“The consequences of our Annoyance Economy extend beyond wasted time and money: When life is reduced to jumping through an endless series of hoops — just to fix a billing error, secure a refund, or cancel a subscription, it breeds cynicism and disengagement. If the government can remove even a few of those obstacles, we can show the American people that someone is paying attention and begin the long process of rebuilding public trust.”
Key Takeways:
- Over the past two decades, time spent on the phone with customer service is up 60%. Now before being able to cancel a reservation or end a subscription, consumers are forced to jump through promotional hoops and listen to incessant hold music. Companies have quietly made it more difficult for consumers to take actions that don’t fit their bottom line.
- Making cancellation more difficult can boost corporate revenues by more than 200%. That’s why industry fights so hard to protect their practices. Without action from policymakers, consumers will continue to throw away time and money on subscriptions and surveys they don’t actually want, just because it’s too difficult to cancel.
- Junk fees are breaking the bank. The report’s authors cite the annual dollarized harm of junk fees — on everything from concert tickets to food delivery to hotel reservations — is a whopping $90 billion.
- Consumers know they’re getting the short end of the stick. The authors report that researchers found customer service experience scores in 2024 were the lowest on record. And the aptly named Consumer Rage Survey found that 74% of customers reported a product or service problem in the past year, more than double the rate in 1976.
- Policymakers could — and should — act to protect consumers. The Trump administration has unwound bedrock consumer protection regulations and Congress should codify them. The authors argue that click-to-cancel rules, refund requirements, and bans on scam calls, among other reforms, would save Americans time and money while making a meaningful difference in daily life.
Exclusive polling from Data for Progress reveals that consumers are fed up and want their elected representatives to do something about it:
- More than two-thirds (68%) of voters want Congress to prioritize addressing annoying business practices like spam calls.
- A majority (58%) of voters find health care paperwork and coordination to be frustrating.
- Nearly nine in ten (85%) voters report they are frustrated by incessant spam calls and text messages.
- Three in four voters (75%) say they are frustrated by surprise junk fees, including from hotels, airlines, ticketing vendors, and phone and internet providers.
