Uber Drivers Underpaid? MIT To Review Its Study After Uber CEO's Tweet
- Author: Rita Burton Mar 05, 2018,
Mar 05, 2018, 0:06
Given inevitable costs of maintenance, fix and depreciation, "effectively what you're doing as a driver is borrowing against the value of your vehicle", Zoepf said, adding: "It's quite possible that drivers don't realize quite how much they are spending". And however much Uber pays its drivers, it's nearly definitely not enough, either.
But drivers employed by the ride sharing companies don't make much money - and often earn less than their state's minimum wage, according to research from the Massachusetts Institute of Technology's Center for Energy and Environmental Policy Research. But, he said, even if MIT's methodology needs to be tweaked ― which is possible, since it's a working paper ― its fundamental finding is spot on: Drivers aren't making enough money. Researchers surveyed over 1,100 drivers and analyzed vehicle cost data, including insurance, repairs, and fuel. Gross driver revenue is just $0.59 per mile but drops to $0.29 per mile after vehicle operating expenses are factored in.
While most drivers use vehicles for personal use and ride-hailing services, the bulk of the miles they drive are for work, which can lead to significant short-term and long-term costs, the paper said.More news: Blake Bortles is a keeper for Jaguars despite Internet jabs
Uber and Lyft had no intentions of competing in Winnipeg as drivers would have to cover their own Manitoba Public Insurance (MPI) costs. Minimum wage is $7.25 - more than double. The tax deduction is higher than the actual cost-per-mile, facilitating an estimated $4.8 billion in untaxed income, the study said.
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 could not be reached at time of writing, although earlier a spokesperson told The Guardian it reckoned the study's methodology and findings were "deeply flawed".
Researchers found that rideshare drivers made an extremely low profit, with the median profit being only $3.37 per hour. Most recently, the company announced the rollout of Uber Health, an app that allows patients and health care providers to bypass a profile requirement for secure rides to and from hospitals and medical centers.