For more than 230 years, the penny has been a small but familiar part of American life, jingling in wallets, cash registers, and coin jars across the country. But rising production costs and a decline in cash use have prompted the U.S. government to phase out its smallest coin, leaving many to wonder why the penny is disappearing and how its absence could affect everyday transactions.

“Between overhead, material costs, and transportation, it simply costs more than one cent to make a penny,” explained economics teacher Mr. Schottler, pointing out that changes in the coin’s composition have made production inefficient. Once made of copper, pennies are now primarily zinc, yet even the cheaper metal does not reduce costs below their face value. Schottler noted that only about 14 to 18 percent of Americans still use cash regularly, and the penny, among all coins, serves the least practical purpose. “It doesn’t really function in modern transactions the way it once did,” he added, noting that pennies cannot be used in vending machines or parking meters, and many people avoid using them altogether.

Inflation has also eroded the penny’s value over time. Schottler said that as prices rise, a single cent buys less than it once did, further diminishing its usefulness. Economists have cited this long-term decline as a major reason to stop producing the coin rather than continuing to produce it at a loss.
Workers who handle cash every day see the impact of the penny from a more hands-on perspective. Cash Slann, Class of 2026, is familiar with cash handling, described how pennies remain common in cash transactions, especially when customers pay with larger bills. “A lot of people pay with bigger bills, like fifties or hundreds,” Slann explained. “That usually means giving back a lot of coins, including pennies.”

He noted that most customers do not care about receiving pennies, often leaving them behind or taking them without much thought. Disputes are rare but do happen when change is off. “Most people don’t really care about a few cents,” Slann said, “but once in a while, someone will get upset if their change is off by a penny or two.”

Pennies also affect the speed of transactions, particularly during busy shifts. Counting small amounts of change can be time-consuming, and errors are more likely when registers are crowded with coins. Slann added that pennies play a role in maintaining cash flow behind the scenes. Registers must be restocked and counted frequently, and removing pennies could complicate cash handling. “If pennies disappeared completely, it might affect how cash is managed behind the scenes,” he said. “But for customers, it probably wouldn’t make much of a difference.”

From a collector’s perspective, the coin’s decline has been long in the making. Jon Melick, a coin collector and member of an online numismatics group, described the penny as having “all but disappeared in commerce,” with most coins cycling between banks, merchants, and change jars rather than being actively spent. Melick also pointed out that rising production costs affect low-value coins more than higher denominations, making the penny the first logical target for elimination. “The cent costs much more than its face value to produce. At some point, that no longer makes sense for taxpayers,” he explained.

Historically, the United States has discontinued other coin denominations, such as the two-cent piece and the half dime. Melick suggested that the penny’s longevity has been tied to public concern that eliminating it would raise prices, even though experiences in other countries indicate otherwise. “Canada’s rounding system is written into law, and over time, people break even. Rounding goes both up and down,” he said.

Even if production stops, pennies will not vanish overnight. Many will likely be deposited into banks and eventually returned to the Treasury for recycling, while older coins may be hoarded by collectors. Despite its long history and symbolic value, the penny’s future appears limited. As inflation continues, cash use declines, and production costs rise, experts agree the coin no longer serves a meaningful role in the modern economy. “It’s sad in a historical sense,” Melick said, “but it no longer makes sense to keep producing something that doesn’t circulate the way money should.”