April 2015 Archives

I've been hearing a lot of outrageous claims about the new driving services like Lyft and Uber, claiming that drivers make three and four thousand a month.

I will demonstrate the claim to be nonsense. In fact, most of the time, the drivers aren't making even minimum wage.

A driver for these services told me about this fantastic day of work he had - best ever. In a little over thirteen hours, with about thirty calls of which six cancelled while enroute to pick them up, he grossed a little under $255 in fares. (Exact amount redacted to protect anonymity). Furthermore, considering this was in Southern California, he managed to miss all but a few miles of traffic that was significantly slowed - a miracle.

He did not at any time drive between fares any further than a convenient and safe legal parking area. Furthermore, for over six hours consecutive, he always had another call before he found such a spot. He had one wait of approximately fifteen minutes between fares early on, but for the entire thirteen-plus hour "shift" he estimated that a total of no more than 45 to 60 minutes was spent waiting for a fare. At the end of the evening, he had a drive home of approximately forty miles, leading to a grand total of 305 miles of driving.

So let's do the math based upon his gross fares.

$255.00 less the service cut of $51.00 leaves $204.00

2015 Mileage deduction is 57.5 cents per mile. This includes gas, maintenance, etcetera. I guarantee that the IRS didn't just generously allow people to deduct 57.5 cents per mile off their taxable income - this is the real level of expenses. It's an average.

57.5 cents times 305 is $175.375. I'll give them the half penny. $204-175.37 leaves $28.63.

$28.63 over a thirteen hour shift is $2.20 per hour. As opposed to California's minimum wage of $9.00 per hour or the federal minimum of 7.25. And this was a "fantastic" day.

Note that this does not include the pro-rate of the phone or the phone plan. Call it $50 per month or $1.67 per day. Nor does it include meal costs away from home. Nor does it consider that the drivers are responsible for both halves of the FICA and Medicare payments, and receive no benefits at all.

Note that this person does not regret driving, and it's preferable to him to collecting unemployment or various other dodges like going on disability. For drivers with older cars and lower operating expenses, they might be gaining a little on the 57.5 cents per mile, but it's still nothing like thousands of dollars per month. And both of the services have a limit on the oldest vehicle they will accept, no matter how well maintained.

Not to put too fine a point on it, these driving services are getting away with sweatshop wages by shifting all of the costs and risks to the drivers, many of whom will not understand their costs. The services themselves made a substantial upfront investment and are doing very well off of it. The drivers choose to drive of their own free will, but the prices the services charge mean they're only making the phantom of a living.

I'm willing to accept more evidence. I'm having an issue with comments working, but I've created two new emails. They are (eliminate the spaces) u b e r (at) this domain name and l y f t (at) this domain name. I'll keep them open until the spam outstrips the actual responses.

If you're a driver with one or more of the services, email the appropriate address from the previous paragraph. If you're not with one of the majors, pick one or the other to send to. Required information is: Total fares, total amount deducted by service, total miles driven, total length of time in service (in hours actively working calls). I'm going to put a minimum time of a four hour shift on it. Better would be your total time worked over a seven day period.