Driving for Uber or Lyft Is Awful, New Study Shows

Driving for Uber or Lyft Is Awful, New Study Shows


New research from MIT shows that the vast majority of people driving for Uber or Lyft make less than minimum wage. Additionally, 30 percent of drivers actually lose money with each mile they drive.

If you are driving for Uber or Lyft, you aren’t going to make any money. In fact, you may actually be paying for the privilege of working at a ridesharing company. According to a study published by MIT, the median profit for drivers is an abysmal $3.37 an hour, and that’s before taxes. Ultimately, 74 percent of drivers earn less than minimum wage and, once vehicle expenses are taken into account, 30 percent actually lose money every mile they drive.

We’re just getting started.

The researcher also found that, in the U.S., an overwhelming majority of profits made while driving for Uber and Lyft aren’t taxed. For each mile driven, drivers incur about $0.30 in costs; however, they are able to claim a Standard Mileage Deduction of $0.54 per a mile on their taxes — a difference that amounts to billions of dollars in untaxed income.

So the drivers aren’t the only ones paying the price. We all are.

In an interview with The Guardian, an Uber spokesperson stated that the paper is little more than sensationalism, calling the methodology and findings “deeply flawed.” Yet, MIT isn’t exactly known for being a sensationalist publication.

In any case, the research paints a dark picture of the revolutionary ridesharing industry; however, it’s far from the first time the ride-hailing apps have faced censure. In September of last year, London decided not to renew Uber’s license to operate in the city, citing lacking corporate responsibility as one of the primary determinants.

Yet, the study is significant in that it highlights serious and untenable flaws in the gig economy model — a model that is fast creating a financial culture in which most people can’t survive. Mark Tluszcz, co-founder and CEO of Mangrove Capital Partners, succinctly summed the problem in an interview with TechCrunch: “We’re creating the next lost generation of people who simply don’t have enough money to live, and those companies are fundamentally enabling it under the premise that they’re offering a cheaper service to consumers.”

The problem stems from the fact that current policies weren’t written under a gig economy model, so platforms like Uber and Lyft are able to exploit loopholes in policy and avoid regulations that traditional companies must abide by. Studies like this highlight the reality that, for many, a secure financial future may depend on immediate updates to employment law.


But on the other hand, they actually make tips now as well as various rates per hour, etc.
I don’t know how well the study is and the article clearly doesn’t explain their argument in much detail. Cab companies are pointless depending on where you live especially in the suburbs, and driving for Uber or Lyft was never meant to be a career, just like any part time job, it’s just extra income, for most folks and it helps pay for gas.

Also, attacking some rideshare company that actually solves a problem with local transportation, though not perfect, is getting old and out dated. The argument against regardless of which company is doing the work, is literally redundant and a waste of time.

Acting as if these companies are the leaders in the “more work, less pay” generation- I would disagree. There are plenty other companies out there in all levels and areas of expertise, that pay shitty, expect more work then attempt to live on the $$ and it’s impossible. Washington D.C.? Maybe. Seattle? Baltimore? New York City? San Francisco? Atlanta?


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