Uber, Lyft drivers actually earn less than minimum wage, MIT survey suggests

Uber, Lyft drivers actually earn less than minimum wage, MIT survey suggests

Minimum wage jobs bring home more profit than working for Uber or Lyft, according to an analysis by the Massachusetts Institute of Technology.

Median profit for Uber and Lyft drivers is $3.37 per hour before taxes, according to a survey of over 1,100 drivers by the MIT Center for Energy and Environmental Policy Research.

The data, published in a research brief, found that 74% of drivers earn less than the minimum wage in their state. About a third of drivers are actually losing money when factoring in vehicle expenses, researchers said.

“This paper provides one of the first detailed estimates of ride-hailing profit,” researchers said. Survey questions focused on self-reported revenue, mileage, vehicle choices, operational cost parameters for insurance, maintenance, repairs, fuel and depreciation.

Paststudies have shown higher profits for Uber drivers.

Uber spokesperson Michael Amodeo released a statement questioning the accuracy of the findings: “While the paper is certainly attention grabbing, its methodology and findings are deeply flawed. We’ve reached out to the paper’s authors to share our concerns and suggest ways we might work together to refine their approach.”

The company suggested one of the survey questions asking drivers to report on-demand activities could have resulted in low figures, because drivers might not have reported total income.

Lyft spokesperson Alexandra LaManna also released a statement on the MIT paper saying: “We will continue to engage with our driver community to help them succeed. We have not yet reviewed this study in detail, but an initial review shows some questionable assumptions.”

Uber has been struggling to regain drivers’ favor for quite some time. Its 180 Days of Change campaign attempted to make drivers happier with a range of perks that included an all-expense-paid opportunity to meet with company’s CEO. Last summer, the company added a tipping option — following Lyft’s example.

Although drivers have still expressed a need for more income, the low-cost alternative to taxis and car ownership is making new inroads into other traditional transportation avenues.

Last week, Uber announced its launch of Uber Health, a desktop platform for healthcare providers that allows doctors to provide rides for patients who might otherwise miss their appointments because they can’t get to them. Lyft has been working with healthcare providers for the past few years through its LyftConcierge business platform.

 

Source by usatoday..

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