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Half of US Uber Drivers Make Less Than $10 An Hour After Vehicle Expenses, Study Says (recode.net)

Posted by BeauHD on from the nickeled-and-dimed dept.

Echoing a similar study by the JPMorgan Chase Institute, a new study finds the median hourly pay with tip for Uber drivers in the U.S. is $14.73, which includes tips and excludes expenses like insurance, gas and car depreciation incurred while working. The study was conducted by Ridester, a publication that focuses on the ride-hail industry. Recode reports: Using Ridester's low-end estimate of $5 per hour in vehicle costs, drivers would bring in $9.73 per hour and potentially much less. That implies a driver working 40 hours per week would make an annual salary of almost $31,000 before vehicle expenses, and about $20,000 after expenses (but still before taxes). That's below the poverty threshold for a family of three. It's also a far cry from the $70,000 to $90,000 Uber once claimed its drivers made in major markets.

The study, which was conducted this summer, asked drivers for a screenshot of their Uber app's earnings page from their last full day driving. The 719 valid screenshots they used show how many hours the drivers worked and how much they were paid after Uber's cut. It doesn't factor in other costs like taxes or healthcare. And -- worth noting -- the study only represents drivers who were motivated enough to send in their data and isn't necessarily representative of the geographical distribution of Uber drivers.

17 of 156 comments (clear)

  1. Had my eyes dilated by rsilvergun · · Score: 4, Interesting

    and took an Lyft. 14 mile round trip during 'surge' pricing (it was raining) was $26 bucks. I left a $10 tip each way (hopefully Lyft doesn't take 30% of it). One guy was pretty obviously a recently out of work fellow driving an SUV bought during better times...

    Also, $20k is below the poverty threshold for a family of one. Screw the gov't for not raising it. I don't think it's been raised significantly since I was a wee lad.

    --
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    1. Re:Had my eyes dilated by alvinrod · · Score: 4, Insightful

      It really does depend where you live. There are some places in the country where $40k will buy you a decent sized house and others where it will barely let you rent a glorified broom closet for a year.

      To anyone who wants everyone to earn a living wage, find something that you can pay them to do that will afford them that living. The sad truth is that there are some people who lack the skills, aptitude, or desire to be able to earn a living. It's not a mater of personal failing either, unless you think people choose to be born mentally retarded or otherwise disabled that prohibits work. I suspect that most people are more than willing to help the truly incapable, but there are lot of people who are in that situation entirely by choice, either a refusal to work jobs they're capable of (but somehow they think are beneath them) or through a history a poor decisions that have left them with nothing.

    2. Re:Had my eyes dilated by Uberbah · · Score: 3, Insightful

      Not every job should be required to pay enough to let you afford your own place.

      If a business doesn't pay a living wage, that business doesn't deserve to exist.

    3. Re: Had my eyes dilated by astrofurter · · Score: 2

      "Not every job should be required to pay enough to let you afford your own place."

      It's a race to the bottom - and we're gonna WIN!

    4. Re:Had my eyes dilated by angel'o'sphere · · Score: 2

      Not every job should be required to pay enough to let you afford your own place.
      Actually it should. Especially if it is a 50h - 60h per week job.

      Find a roommate while you work on your skillset.
      In a single room, haha ... or sleeping in a SUV with a room mate?

      Most Uber drivers have another job that is their main income. 80% are part time drivers. 20% drive less than 10 hours per week.
      Why do you claim that? How many Uber drivers do you know in person?

      --
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    5. Re:Had my eyes dilated by mpercy · · Score: 2

      "Also, $20k is below the poverty threshold for a family of one."

      Really?

      2018 Poverty Guidelines for the 48 Contiguous States and the District of Columbia
      Persons in family/household Poverty guideline
      1 $12,140
      2 16,460
      3 20,780
      4 25,100

  2. A lot will by rsilvergun · · Score: 2

    but Amazon's very physically demanding. A lot of Uber drivers are folks who can't stand up straight let alone for 8 hours a day. Still, Amazon being forced to pay $15 will help drive wages up. When it comes to wages a rising tide lifts all boats.

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    1. Re:A lot will by torkus · · Score: 4, Interesting

      Amazon wasn't forced to pay $15/hr. They decided to freely do so ... which i'll admit comes ahead of an eventual bill that would have cost them significantly more.

      Still, they do set a new standard which will drag up a lot of other companies around them. I still wonder what happened to uber. Their rates have gone up, not down, yet drivers seem to be making substantially less than just a few years ago. Too many cars idling and not getting rides? Uber increased their cut? Something else?

      --
      You can get rich if you own a politician, but you have to be rich to buy one in the first place.
    2. Re:A lot will by arglebargle_xiv · · Score: 2

      I still wonder what happened to uber. Their rates have gone up, not down, yet drivers seem to be making substantially less than just a few years ago.

      They figured out how to squeeze more out of their drivers while paying them less. This is Uber we're talking about here, not Facebook or Google. If they could drive their empl^H^H^H^Hindependent contractors pay down to zero while they took the remaining 100%, they would.

    3. Re:A lot will by BlueStrat · · Score: 3, Insightful

      Any fair analysis would tag the vehicle as a business expense, because it is a necessity for the business.

      A few things.

      Does "fair analysis" as used here mean roughly what the IRS considers a 'business' and what it does *not* consider a 'business'? In order to be considered a 'business' it must clear some hurdles.

      For example, would someone, let's say a musician/singer, who plays at the local coffee shop for two hours once a month for $75 be a 'business'? Because the IRS would call it a 'hobby enterprise' at best where you simply file a 1099 with your normal return.

      There are also other hurdles and tests it must meet to be a business. An Uber driver who met those hurdles would likely be considered a personal transportation contractor.

      Back to the music scene, if that coffee shop musician played a couple hours 5 nights a week, would that make him an employee due minimum wage and company benefits?

      If he only wants to play a few hours a month and is fine with making less than $10/hr because he does it for fun and publicity along with a little extra guitar-string money and makes less than $10/hr, should the government stop him? If an Uber driver just wants to drive a few hours here and there and is fine with netting less than $10/hr after expenses, should the government stop him?

      These are some of the questions that must be answered.

      Strat

      --
      Progressivism (aka US 'Liberalism'): Ideas so good they need a police/surveillance-state to enforce.
  3. Re:Pffff by JMJimmy · · Score: 4, Interesting

    It's downright sad to be sure but they're trading capital in their vehicle for income. When that capital is gone due to wear & tear they lose their income. Taxis were priced as they were for a reason - and it wasn't to become rich.

  4. Re:Well I if didn't count my business expenses by rtb61 · · Score: 2

    Yeah no one, just starvation, living naked in the streets and being used as target practice by the local county mounties and if you survive it is off to the for profit prison and slave labour. Yep, absolutely no one forcing them at all :/.

    --
    Chaos - everything, everywhere, everywhen
  5. Re:Pffff by ugen · · Score: 2

    Uber and Lyft both are now offering "rent to drive" options, where driver does not even own a car. They "rent" a vehicle from Lyft/Uber and then drive it. So, no wear and tear on their own vehicle, although of course their take home pay is even less and they are basically a completely hired employees (except for any benefits).

  6. Re:Well I if didn't count my business expenses by Uberbah · · Score: 2

    You speak as if people haven't been forced to make a living since the Dawn of Man

    Congratulations on getting the point. Working is a necessity, not a choice. And if the work available is driving for Uber for less than minimum wage after gas and maintenance, people will do it for a roof or food.

  7. Re:Go to Amazon by Uberbah · · Score: 5, Insightful

    They should get some education or some training and increase their earning power

    So you can sneer at them a second time for taking on student loans they couldn't afford?

  8. Re:The real scam is the rental agreements... by asylumx · · Score: 2

    Just to pile on, here's an article from Mr. Money Mustache about his Uber experiment and how the math worked out. Obviously he did this as an experiment and there may be some other tricks & benefits if you're "full time", but even so, the results are not encouraging for drivers. Ultimately his costs for his day (2 hours) of driving worked out to about $7/hr after expenses -- and that was in an electric car, not accounting for electric costs because he uses free charging stations wherever possible.

  9. Re:Go to Amazon by mrclevesque · · Score: 2

    "Provided you have the will power, no one needs to live a life of misery teetering on the edge of poverty."

    So like if your tall you can reach higher ?