Wednesday, 26 September, 2018

Uber and Lyft drivers make little money

How Much Do Uber and Lyft Drivers Really Make? New Study Shows Pay Is Pathetic Study Finds Uber, Lyft Drivers Earn Median Income Of $3.37 Per Hour
Kelvin Reese | 05 March, 2018, 00:05

In 2017, courts in both North Carolina and NY ruled in Uber drivers' favor to be classified as employees, which could eventually entitle them to higher pay and more benefits. Lyft offers the same vague insight: "The more you drive, the more you earn".

Researchers did an analysis of vehicle cost data and a survey of over 1,100 drivers for the ride-hailing companies for the paper published by the Massachusetts Institute of Technology's Center for Energy and Environmental Policy Research.

The researchers said that with the median income of $3.37 per hour, some 74 per cent of drivers make less than their state's minimum wage.

The Guardian reports the situation isn't much better for the other 70%, as the median profit for drivers for the two ride-share companies is just $3.37 per hour before taxes.

The research paper explains that vehicle costs included estimate insurance, gas, depreciation, and fuel expenses for operation.

It isn't all bad news for drivers, however.

The study also shows that despite driver's median gross revenue being $0.59 per mile, taking into account for vehicle expenses, that figure was brought down to $0.29 per mile.

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Indeed, it's not clear whether the self-reported numbers come from a representative pool of drivers.

Monthly average profit is $661, while the median is $310, meaning a smaller group at the top end pulls in much higher profits, while most people don't.

Uber and Lyft have "notoriously high" turnover rates among drivers, NPR reported, with only 4 percent of the drivers staying with Uber for at least a year.

'While the paper is certainly attention grabbing, its methodology and findings are deeply flawed, ' an Uber spokesperson told the Guardian. Lyft's spokesperson said there were "some questionable assumptions" made in the paper.

And a study from Stanford University found male Uber drivers make $21.28 per hour and female drivers earn $20.04. The paper also looks at taxes. Campbell worked with the MIT researchers on questions for the survey. Existing surveys also tend to focus on hourly rates rather than per-mile rates; nearly none of them look at driver costs. And 30 percent of drivers lost money after expenses.

'These drivers are our most important partners, but we haven't done a very good job honoring that partnership, ' said Rachel Holt, regional general manager for Uber in the USA and Canada.

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