MIT study shows how much driving for Uber or Lyft sucks
Source: TechCrunch
Ride-hailing giants Uber and Lyft are delivering pitiful levels of take-home pay to the hundreds of thousands of US independent contractors providing their own vehicles and driving skills to deliver the core service, according to an MIT CEEPR study examining the economics of the two app platforms.
The report catalyses the debate about conditions for workers on gig economy platforms, and raises serious questions about the wider societal impacts of tax avoiding, VC-funded tech giants.
The study, entitled The Economics of Ride-Hailing: Driver Revenue, Expenses and Taxes, and which was carried out by the MIT Center for Energy and Environmental Policy Research, surveyed more than 1,100 Uber and Lyft ride-hailing drivers combined with detailed vehicle cost information factoring in costs such as fuel, insurance, maintenance and repairs to come up with a median profit per hour worked.
The upshot? The researchers found profit from ride-hail driving to be very low. On an hourly basis, the median profit was $3.37 per hour, with 74% of drivers earning less than the minimum wage in the state where they operate.
Read more: https://techcrunch.com/2018/03/02/mit-study-shows-how-much-driving-for-uber-or-lyft-sucks/
I only used Lyft once. The lady who picked me up was nice. I had to drop my car off for repair and this was the easiest way to get back home. A taxi would have cost considerably more. I was thinking of driving on the weekends with my minivan, but I have too much pet hair in there. I use it to shuttle my dogs around and for work.
LisaM
(27,758 posts)Same with GrubHub, in fact, the gig economy in general. I'm not defending the taxi business, which I think created some of its own problems (in Seattle, for example, they limited the number of available medallions and don't offer flat fees to the airport), but if I do need to hail a ride, it always is a taxi.
AtheistCrusader
(33,982 posts)I tipped at a rate of 100% both times, because I can't see it working for the driver any other way.
iscooterliberally
(2,849 posts)I think I gave my driver about a 50% tip, but I really didn't know it was this bad at the time. Now I know better.
knightmaar
(748 posts)Most drivers only count their gas usage and forget everything else.
AtheistCrusader
(33,982 posts)knightmaar
(748 posts)I didn't realize until way too late in my life how much those poor kids are getting ripped off. We make our own pie now.
keithbvadu2
(36,360 posts)truck drivers - owner/operators... indentured servants
You think you own your own business and find that you really only own the debt.
https://www.usatoday.com/pages/interactives/news/rigged-forced-into-debt-worked-past-exhaustion-left-with-nothing/
RIGGED
Forced into debt. Worked past exhaustion. Left with nothing.
iscooterliberally
(2,849 posts)I used to drive a large straight job with a lift gate when I was in my twenties. I didn't like driving the truck so much. I don't envy anyone who has to drive a semi. It really isn't fair how truckers are treated at all.
Wounded Bear
(58,437 posts)gibraltar72
(7,486 posts)that would work out for the drivers. As an old insurance agent I knew in most every state once you got paid to drive your insurance was no good. Commercial insurance is sky high. I'm sure some have gotten away with it but first claim rude awakening. When you figure how much it costs to drive and maintain a vehicle. You'd be upside down.
iscooterliberally
(2,849 posts)I was playing in a local cover band full time. We were playing out 4-5 nights a week. I owned most of our PA system and needed the van to haul the gear around. We usually played in one club for the week, but even if we came back the very next week we had to load out on Saturday night. I was lucky that my insurance agent asked me that key question. He told me that if I happened to get into an accident and didn't have commercial insurance my claim would be denied. Back in 2012-2013 I was living up in Boston and thinking of driving for a delivery service. I found out we had to use our own vehicles and knew that I would need commercial insurance for that. Massachusetts even has separate vehicle tags for this type of use. I decided to pass on that job needless to say.
gibraltar72
(7,486 posts)when you charge someone to ride in your vehicle is Yuuuge. It's bad when it's cargo. But when it's people liability skyrockets.
iscooterliberally
(2,849 posts)We ended up buying my mother's old used car and gave it to our son when he was in high school. We had him pay his own policy since we gave him the car. He didn't need full coverage since it was payed off. It was way less expensive than just putting him on our vehicles and letting him drive them.
WilmywoodNCparalegal
(2,654 posts)for locals. Taxicabs won't come anywhere near that is not the tourist areas. I live in Las Vegas, so that means the Strip, Fremont Street and the airport. Yet, thanks to Uber/Lyft, I can now go party it up on the weekends without worrying about drunk driving or parking my own vehicle somewhere expensive.
Likewise, many people use Uber/Lyft to go to/from work, school or the doctor's office. I always tip well (I also drove Lyft for a short period of time). Cabs are infamous in Las Vegas for long-hauling passengers and for rude customer service. My own experiences with cabs in Vegas before I started living here have been horrible.
Uber/Lyft are not ideal but in many places they are needed services.
IronLionZion
(45,255 posts)Most drivers do gig work while they apply for normal jobs, or to supplement income as a part time job with flexible hours. This is also true of TaskRabbit and many delivery services. If they had a better alternative, they would obviously take it.
I've also had drivers who work where I work, and are picking up people going in that direction as their normal commute to their office job. I've had drivers who were immigrants who don't speak a word of English, retired/elderly, deaf, disabled, stay at home moms/dads after dropping their kids in school, and people of every age and race.
The same argument can be said for exploiting low wage labor overseas. What else are those workers going to do for income?
gyroscope
(1,443 posts)...doing rideshare could have been a decent way for people to make extra money, but the businessmen running the companies are way too greedy to let that happen. They will never stop seeking ways to exploit and squeeze every last nickel from their drivers. That has always been the nature of the taxi business. Which explains why 90% of taxi drivers have historically been brown-skin immigrants who can barely speak English - because they are easier to exploit, doing a job few Americans want to do.
Until Uber and Lyft came along with their ultra-slick marketing that suddenly made it cool and hip to be a glorified taxi driver. So now they got a lot white people driving for them and learning firsthand what it feels like to be an exploited immigrant taxi driver lol.
Demonaut
(8,909 posts)your ratings got too low, it was terrible