← The Economics of Everyday Things
The Economics of Everyday Things
97. Elevators
00:18:14
Americans take more than 20 billion elevator rides every year — and keeping them safe is an expensive proposition. Zachary Crockett makes small talk.
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- [00:01]
Narrator
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Shannon Moore
Now more.
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Zachary Crockett
A couple times a week, I step inside a metal box and push a button that seals me inside. Sometimes I do this with total strangers and we rarely talk about it. We just stand in silence while a system of cables transports us up and down a concrete shaft. It's my four story apartment building and we are in the elevator. If your elevator works well, it's easy to take it for granted, but some people think about these machines all day.
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Shannon Moore
Yeah, we're not really seen until you know about us. We're kind of like leprechauns in that way, right? You know, you're talking about elevators and you start seeing an Otis truck here and all of a sudden you're like, oh, my gosh, they're everywhere. My name is Shannon Moore, and I'm a service Mechanic for the Local 8 Union Elevator Constructors.
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Zachary Crockett
Moore is right. Elevators are Everywhere in the US there are around a million of them, and 10,000 new ones are built every year. Manufacturing and installing all of these elevators is a lucrative industry. And behind the scenes, it takes thousands of workers and quite literally tons of technology to make sure your journey to the top is a smooth one.
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Brian O'Connell
Elevators, I think, are a lot like WI fi. You never hear anybody say, oh, yeah, this signal's really great, but everybody notices when they're not working.
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Zachary Crockett
For the Freakonomics radio Network, this is the economics of everyday things. I'm Zachary Crockett. Today, elevators, the earliest predecessors of elevators go back thousands of years. In ancient Rome, winches and counterweights were used to transport lions, wolves and bears from underground tunnels into the Colosseum for gladiator battles. These systems were powered by animals or even people. Over the centuries, elevators evolved to be powered by steam and were used in factories during the Industrial Revolution. But when cables broke, the cabin would go crashing to the ground, sometimes killing the people inside. In the 1850s, as freight elevators were multiplying, Elijah Graves Otis invented a safety brake that would catch an elevator car in place if the cables ever broke. It allowed people to ride in elevators without fear, and it forever changed city skylines, because until then, all the action had been on the ground.
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Brian O'Connell
If you think about that time period in the United States and New York City especially, the most valuable property was always on street level because you wanted to limit the amount of stairs that you had to walk up.
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Zachary Crockett
That's Brian o' Connell, Otis Elevator's senior vice president of the Eastern US as.
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Brian O'Connell
There was broader urbanization, the elevator was a key driver in being able to continue to have more densely populated areas and expand that construction higher and higher.
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Zachary Crockett
Today, Otis is the largest elevator company in the world. In 2023, they built around 20% of all new elevators. And they did service work on more than 2 million pre existing elevators globally. Their fleet includes some pretty prominent real estate in New York.
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Brian O'Connell
Here one of our marquee buildings is of course the Empire State Building. But internationally, we also have been a key part of the building of the Eiffel Tower, as well as the tallest building in the world, the Burj Khalifa in Dubai.
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Zachary Crockett
The longest vertical distance scaled by an elevator is actually inside the ground. The Mpaneng gold mine in South Africa has cabs that plummet nearly one and a half miles, around three times the height of the Burj Khalifa. Others can reach speeds of 40 miles per hour. But O' Connell says the typical Otis client is much less dramatic.
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Brian O'Connell
The average Otis customer, when you look globally, is actually like a four or five stop, one unit job, whether that's residential or a small hotel.
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Zachary Crockett
The elevators around you in daily life fall into two basic categories. You have hydraulic elevators, which use pressurized fluids and pistons to push a cabin up from below. And then you've got traction elevators that use rope or cables to pull a cabin up from above. Like in olden times, when a building wants to install a new elevator, the developer or architect on the project puts together a document specifying what the building needs.
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Brian O'Connell
That specification will have an understanding of how many elevators are in the building. If we have any particular recommendations on the size of the cabs, kind of how many people will fit in each elevator, and then how fast those elevators should go, depending on how quickly you want to move people in and around.
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Zachary Crockett
Once the plan is set, manufacturers like Otis put in a bid to win the job.
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Brian O'Connell
Once it's completed, you'll go into contract negotiation, and then construction starts.
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Zachary Crockett
Construction for an elevator begins with the shaft. A general contractor builds out a massive vertical corridor through the floors using a strong material like concrete or steel. Once that's set up, an elevator installer starts on general assembly. The rails and brackets that guide the car are set in place. A machine room is built to house the motor, and eventually the cabin itself is loaded in.
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Brian O'Connell
Then we'll of course, go through a rigorous testing process to make sure that all the various safety layers that have been installed work correctly, that the car can run at its intended and specified speed. And then there's going to be a formal test, usually with the code authority or whatever local authority would be there before we're allowed to hand over the elevator.
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Zachary Crockett
The typical European elevator comes in at 3ft 6 inches by 4ft 6 inches, just big enough for a wheelchair user and one extra person. But in the US, new elevators have to be big enough to fit a seven foot stretcher and still have room for two more passengers. And that has a financial impact.
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Stephen Smith
The cost is wildly more here. An elevator in the United States costs three to four times as much to install as an elevator in Switzerland for a similarly sized building.
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Zachary Crockett
That's Stephen Smith. He's the executive director of the center for building in North America. It's a nonprofit that works to reform inefficient construction regulations.
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Stephen Smith
A new elevator to install in, let's say a six story building in the United States would be between 150,000 and $200,000. That's the labor and the materials to install the elevator in the shaft.
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Zachary Crockett
On the margins, that additional cost means fewer elevators, particularly in smaller buildings In.
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Stephen Smith
A city like New York or Seattle, you're going to think twice about the cost to install it, the cost to maintain it, the cost in terms of space because it occupies space in the building that then can't be, you know, an extra bedroom, bathroom, closet, whatever.
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Zachary Crockett
Owners of buildings with existing elevators also have a decision to make. Continue investing in aging elevators that require ongoing maintenance or spend the money to modernize them.
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Stephen Smith
Most of the money spent on elevators is actually not in installing new elevators. It's in service, maintenance, and what are called modernizations, which is essentially every 20 or 30 years, you need to rebuild at least part of the elevator. These are much more bespoke projects. In New York, when you underwrite an affordable housing project. The city or state tells you to assume $7,500 per elevator per year in cost.
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Zachary Crockett
Again, here's Otis's Brian o' Connell that.
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Brian O'Connell
Cost benefit discussion is really one of the most critical conversations that we have with our customers. Your particular building might have what we call a full maintenance service contract, which basically means you pay X number of dollars per month and no matter almost anything that goes wrong, it's the responsibility of the elevator service provider to fix it. Other people might have really base level service contracts where bigger repairs are things that they have to pay and that might drive the conversation for modernization.
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Zachary Crockett
Whichever way a building owner goes, he or she will need highly trained service people to keep things moving. Folks equipped to deal with a wide range of mechanical scenarios whenever they show up for work.
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Frank Christensen
We encompass nine trades in one. I mean carpentry, tile work, mechanics, electrical. It just keeps on going from there.
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Zachary Crockett
That's coming up. The Economics of Everyday Things is sponsored by Mint Mobile. You know what doesn't belong in your epic summer plans? Getting burned by your old wireless bill. While you're planning beach trips, barbecues and three day weekends, your wireless bill should be the last thing holding you back. Make the switch to Mint Mobile with plans starting at 15 bucks a month, Mint Mobile gives you premium wireless service on the nation's largest 5G network. All plans come with high speed data and unlimited talk and text. The coverage and speed you're used to, but way less money. Ditch overpriced wireless and get three months of premium wireless service from Mint Mobile this year. Skip breaking a sweat and breaking the bank. Get your summer savings and shop premium Wireless plans@mintmobile.com Economics that's mintmobile.com Economics Upfront payment of $45 for 3 month 5 gigabyte plan required equivalent to $15 per month New customer offer for 3 months only, then full price plan options available, taxes and fees extra. See Mint Mobile for details. The Economics of Everyday Things is sponsored by Constant Contact when it comes to growing your business, we all know that engaging with your customers is crucial. But the question is always how? Most don't have the time, skills or money to put towards keeping up with marketing every day. Everyone is too busy running their companies to begin with. Your mini marketing team awaits with constant contact with their all in one platform, you can create and manage attention grabbing campaigns in just a few clicks. Email, text, social media events, landing pages, you name it, it's all in one place. Constant Contact's AI content generator helps you turn a rough idea into a ready to go message faster than ever and with hundreds of customizable templates, it's easy to make something that looks and reads like your brand. You also get automated sending, real time reporting and tools that actually help drive sales. So you're not just marketing your business, you're growing it. Get a free 30 day trial when you go to constant contact.com try constant contact free for 30 days at constantcontact.com constantcontact.com the Economics of Everyday Things is sponsored by Indeed. You just realized your business needed to hire someone yesterday. How can you find amazing candidates fast? Easy. Just use Indeed with sponsored jobs. Your post jumps to the top of the page for your relevant candidates so you can stand out and reach the people you want faster. There are no monthly subscriptions, no long term contracts, no. And you only pay for results. Join the 3.5 million employers worldwide that use Indeed to hire great talent fast. There's no need to wait any longer. Speed up your hiring right now with Indeed and listeners of this show will get a $75 sponsored job credit to get your jobs more visibility@ Indeed.com everydaythings just go to Indeed.com everydaythings right now and support our show by saying you heard about Indeed on this podcast. Indeed.com everydaythings Terms and conditions apply. Hiring Indeed is all you need. Shannon Moore's family has something of a legacy.
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Shannon Moore
I am a third generation elevator mechanic. My grandfather, my father, my uncle, my brother in law, we're all elevator mechanics.
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Zachary Crockett
Moore is based in San Jose, California, the state with the most people and the most elevators. As an active member of the International Union of Elevator Constructors or iuec. Moore currently works for Kone Elevators. It's one of the so called Big four along with Otis, Schindler and Thyssenkrupp.
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Shannon Moore
So out of the four I've worked for all four.
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Zachary Crockett
That's incredible. How did you train for this job?
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Shannon Moore
All of our training is done on the job and through schooling provided by the union.
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Zachary Crockett
The rigorous training and highly specialized work make landing one of these union jobs a competitive process. But if you're one of the lucky ones, you'll begin your long trek to a career.
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Shannon Moore
The apprenticeship program is a five year program. The first year you're considered a probationary so you will be working on the job with a mechanic. You're essentially kind of like a shadow. You'll get to see the starting portion of putting together an elevator and assembling them and then your apprenticeship classes. You know all of the ladder safety, electrical safety, Job site hazards and awareness just to keep people alert as to what's around them that can possibly hurt them. You're going to learn your knots, square knots, bowline knot, everything that you're going to use in a construction job on a daily basis. They're going to want to make sure that when you're on the job site, you know how to hook your fall protection harness up to one of the lifelines.
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Zachary Crockett
The training protocol wasn't always so extensive.
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Frank Christensen
Back when I started off, you'd be lucky to have a hard hat coming onto a job site.
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Zachary Crockett
That's Frank Christensen, the president of IUEC. The union represents more than 30,000 elevator installers and mechanics in North America.
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Frank Christensen
I got in in 1979, so that's kind of telling you how old I am. You very rarely ever wore a harness when you walked on the job. I remember walking a plank over to the cables on the other side that I might be 40 fours up without a cable holding onto me. But that's what you did back then. That was stupid.
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Zachary Crockett
Falls are the most common cause of on the job fatalities. In his tenure, Christensen has pushed to address this.
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Frank Christensen
When I first took office in 2012, I was having six to eight fatalities a year, which is quite a bit now. We've went two and a half years without a fatality because we've taken a different stance on safety.
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Shannon Moore
There's a lot of pinch points, a lot of potential for moving objects. So you have to be very aware of where you are, where your body is, what you're working on, where the potential for movement is. Is the circuit working on live? Can you work with it with the power off? Do I need to write a job hazard analysis to let my supervisors know that this is a potential issue that we should be facing moving forward on service. There's a lot to take into account before you even start working on an elevator.
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Zachary Crockett
After the five year apprenticeship, you take a test to become a state licensed elevator mechanic. The median salary for a licensed elevator and escalator mechanic is now more than $100,000. And workers get a pension, annuity and other benefits. For Shannon Moore, another perk of the job is the opportunity to nerd out.
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Shannon Moore
You have the groundwork to actually go out there and solve the problems of what's wrong with the elevator. Each company has their own way of writing out their schematics for their wiring diagrams, but sometimes you don't have the prints and then you become like a Sherlock Holmes trying to figure out where the problem is in the sequence of steps. That the elevator needs to run.
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Zachary Crockett
Moore likens the elevator to a patient.
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Shannon Moore
The controller, which is up in the machine room, is typically like the brain. It's telling the elevator, okay, I can run now, I can open doors. It's basically the control center for everything. Then you have what's called a traveler. That's kind of like your spinal cord, right? Relaying everything from the car up to the controller.
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Frank Christensen
I worked on some pretty old ones. They had water, hydraulics, steam elevators at one time, so wooden rails. We joke around wooden rails. There was something to work on, tiller ropes, all different types of old elevators that have been around for a long time. Now you're going to a computer that all you have to do is hook up your laptop or whatever device you have, and it tells you what code went bad and then you fix it from there.
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Zachary Crockett
The so called machine is the heart of the operation. It drives the elevator up and down using ropes over a sheave. Attached to the other end of the ropes is a counterweight which provides vertical stability. Also in the machine room is the governor, the legacy of Elisha Graves Otis.
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Shannon Moore
People are always worried about elevators falling, and you have nothing to worry about on a lot of these machines. There's five hoist ropes on the car top, sometimes more. And they're all designed to carry the weight of the elevator by itself. Let's say somebody goes in there and cuts all the ropes. The car will fall a couple feet, but then the safeties are going to take place and the car is going to be wedged in place, and the fire department or an elevator mechanic will be able to come and get you out.
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Zachary Crockett
Your chances of getting stuck in an elevator are very rare. Despite some famous stories in movies, in real life, it actually only happens 1 in 100,000 rides. But Shannon Moore's got you.
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Shannon Moore
What I'm trying to do first is make sure that I can get the elevator to a spot where the person who's inside the elevator can get out, and then I can spend more time troubleshooting the problem.
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Zachary Crockett
I'm sure a lot of people get trapped in an elevator. A lot of them panic and their first impulse is to like, rip the door open and kind of try to do something stupid.
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Shannon Moore
That is correct. There are safeguards in place to prevent people from trying to pry the doors open. We have a restrictor on the elevator door, so the most anybody should be able to pry open the new doors is 4 inches. Because in a hydraulic elevator, if the car is stuck for some reason and you pry the doors open and it loses hydraulic pressure. That's a game ender for whoever's trying to climb out when that elevator falls.
- [20:16]
Zachary Crockett
Luckily, Moore says most days are far less traumatic.
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Shannon Moore
Typically, my hours of operation are from 7 to 3:30 every month. My company gives me a list of units that are due for service that month. So I will get in the truck, take a look at where I need to hit for service, check to see if I have any call outs from the previous night. Any trouble calls, where elevators are down or not working, I like to hit those first before buildings get busy. Typically it's just there's a push button out. In an elevator, if I get a door issue, the first thing I'm doing is I'm looking down in the track where the door is open and close. We call that the sill. Right. And I'll look for debris. I'll look for a peanut, a cherry seed. The smallest thing like a screw or a pen cap can prevent the door from closing.
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Zachary Crockett
The Princess and the Pea or something. It's like one tiny thing can take down this massive machine.
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Shannon Moore
David and Goliath. Man that one little rock.
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Zachary Crockett
For millions of Americans, elevators aren't just convenient, they're essential. Many people with limited mobility rely on them running smoothly. More elevators will call for more skilled mechanics. As a third generation elevator mechanic, Shannon Moore spends a lot of time thinking about the future of his trade. Do you have kids?
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Shannon Moore
I do. I have one son.
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Zachary Crockett
You think he's going to be in the royal family of elevator mechanics someday?
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Shannon Moore
You know, he has told me since he was 4 years old that he wants to be an elevator mechanic when he grows up. We're going to start our own reality TV show. Instead of Duck Dynasty, it'll be Elevator Dynasty.
- [22:01]
Zachary Crockett
For the economics of everyday things, I'm Zachary Crockett. This episode was produced by Dalvin Abawaji and Sarah Lilly and mixed by Jeremy Johnston. We had help from from Daniel Moritz Robson and special thanks to Craig Summers and his family for suggesting this topic. If you have an idea for an episode, feel free to email us@everyday thingsreconomics.com Our inbox is always open. All right, until next week. What are your thoughts on elevator music?
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Stephen Smith
Ideally, you want to not be in an elevator long enough to need any music at all. The Freakonomics Radio Network the hidden side.
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Zachary Crockett
Of everything Stitcher.
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