Uber and Lyft drivers' median hourly wage is just $3.37, report finds | Hacker News Reader

Uber and Lyft drivers' median hourly wage is just $3.37, report finds

theguardian.com

233 pointspmoriarty261 comments

I question the authenticity of the $3.37 number when I see that the paper this article references was published by an organization funded by these bodies:

Alliance of Automobile Manufacturers, BP, ClearPath Foundation, Conoco Phillips, Duke Energy, Electricité de France, EnBW, ENGIE, ENI, Eversource, Exelon Corporation, ExxonMobil, Gas Natural Fenosa, GE, Golden Spread Electric Cooperative, Inc., Iberdrola, IHI Corporation, EDPC J-Power, Kiewit Energy Group Inc., National Grid, Norwegian Ministries, PSEG, Southern Company, Swedish Energy Agency, Toyota Motor Corporation, TransCanada Corporation

I think Uber/Lyft economics are problematic, but these guys have pretty solid incentives to make Uber/Lyft look unviable.

http://ceepr.mit.edu/support/associates

Instead of giving in to a gut reaction, you should read the paper. All research must get funding in one way or another. If you exclude research due to funding sources and potential conflicts of interest, you wouldn't be left with much.

> If you exclude research due to funding sources and potential conflicts of interest, you wouldn't be left with much.

If the majority of research is tainted by conflicts, that doesn't somehow make it any less tainted by conflicts.

It's trivially easy to design a study to produce the results you want it to, just by selecting things like accounting methods at the outset.

For example, one method of accounting is to allocate costs based on usage. So if you have a car and you drive it 90% for Uber and 10% for your own usage, allocate 90% of all costs to Uber. That makes Uber look really bad.

But if you would have bought the car either way and the question is the incremental cost of driving for Uber, that accounting method is the sunk cost fallacy. It allocates large fractions of a bunch of fixed costs to the incremental use, like the original purchase price of the car, even though they're sunk and can't be avoided either way.

And the money actually does taint the study, because the funders know the parameters of the study ahead of time and only fund the ones that will produce the results they want, which makes the results tainted by selection bias.

You could also read the methodology in the study when it comes out, since describing that is required in science, as opposed to questioning hypothetical methodologies that could be used. From the brief version of the study (http://ceepr.mit.edu/files/papers/2018-005-Brief.pdf), it appears they're using per-mile costs and ascribing only the incremental costs on a per-mile basis.

> Of the five sources of cost estimated per mile (Insurance, Maintenance, Repairs, Fuel and Depreciation), approximately 40% of costs are attributable to Insurance, Maintenance and Repairs, 40% to fuel expenses, and 20% to depreciation.

You are correct that I used a hypothetical methodology.

That's because -- and this is the real problem -- finding the flaw in a specific methodology is a lot of work. It's often not just one thing that throws the numbers off by 200%, it's one thing that throws them off by 12%, then another by 7%, and twenty other little things that add and multiply up to an inaccurate overall conclusion. It can take multiple hours to figure out what actually happened and people don't have that kind of time, so the majority of people only have time to read the conclusion and who sponsored it.

In theory the solution to the problem of everyone having to personally evaluate every study is for a trustworthy reporter to do it for you, but that hasn't worked ever since reporters figured out that "Uber eats souls" gets more clicks than "wage study methodology miscalculates wages."

But if you want a real flaw in this study, how about this one -- most other jobs don't let you count transportation expenses against the hourly wage. Obviously an Uber driver's transportation expenses will be higher, but that doesn't mean you can discount them in the other cases when you count them in this case.

If someone has a 30 mile commute (because living closer to work is even more expensive) at $0.53/mile, that's 60 miles a day, so $31.80 in daily incremental expenses to take the job. 8 hours at federal minimum wage ($7.25/hr) is $58, so after transportation expenses their hourly wage is $3.28/hour. For someone with a 50 mile commute it's $0.63/hour. Suddenly Uber doesn't look so bad.

> most other jobs don't let you count transportation expenses against the hourly wage

Good job in pointing out this huge flaw in this study. Every minimum wage job I ever worked required me to have a vehicle to get to and from that job. That means that every minimum wage job out there where you need to pay for transportation to get to it is paying below minimum wage as the end the day. Those who live in cities have the benefit of public transportation but also have the time cost of being slower and reduces the number of waking hours they can earn money. What's the hours lost commuting averaged across and subtracted against the number of worked?

So everyone here is agreeing that things are pretty fucked for people relying on minimum wage jobs, putting aside whether Uber/Lyft pay below or above minimum.

Do other transportation jobs count transportation expenses against the wage? If not, then that is an excellent point. I would assume taxiing, food delivery, etc. would count them.

Probably a bad assumption. The guy delivering pizzas in his own car for minimum wage is basically an Uber driver that happens to do a lot of business with a pizza place.

When I delivered pizzas (2006; Pizza Hut; Alabama) there was a small additional consideration for gas and wear and tear on my vehicle. As I recall it was around 1/6th to 1/10th of the the ~$6 an hour wage I was otherwise making.

Does their methodology ascribe only the incremental aspect of each of these costs?

If I own a car already for my own personal use. I'm going to deal with all of these costs. You're already going to have insurance, maintenance and repairs, they'll just be more frequent. Fuel expenses is the only input that can be accurately estimated and attributed to ridesharing work performed. Even this contains a huge variable. Did they account for drivers using hybrid vehicles, which more and more ridesharing drivers opt for because it's significantly more profitable? Is the median TNC driver using a more fuel efficient vehicle than the one they accounted for in their calculations?

The fact that the study doesn't have an entire section that I found entirely devoted to potential problems with their methodology that we are pointing out here is reason enough to discount it as tainted after also considering its funders.

The study's not published and expecting the two page preview of the working paper to have a 'discussion of potential problems with methodology' section is utterly unrealistic.

They're clearly trying to gauge incremental costs, not fixed costs, and each of insurance/maintenance/repairs/fuel/depreciation are incremental. The breakdown between the personal and ride-hail vehicle use is part of the study and appears in the sentence previous to the quoted one as "the vast majority of drivers report that the bulk of the miles they drive are for ride-hailing".

> The study's not published and expecting the two page preview of the working paper to have a 'discussion of potential problems with methodology' section is utterly unrealistic.

In that case, it's grossly irresponsible to publish what little they have. Society is still struggling to correct the "statistic" that a woman earns 70 cents for every dollar a man earns. This new statistic about how much TNC drivers make is going to be accepted as fact from here on out, when it's grossly misleading.

> "the vast majority of drivers report that the bulk of the miles they drive are for ride-hailing"

That doesn't change the fact that the vast majority of the drivers would already have that car as a sunk cost whether they drove the vast majority of those miles for ridesharing or not.

That's a misunderstanding of what a sunk cost is. Which of the following are sunk costs?

A car has a resale value. That resale value decreases with each additional mile on the odometer. That's the depreciation incremental cost.

A car requires insurance. Insurance rates fluctuate based on miles driven per period (and also based on whether the car is used in ride-sharing).

A car requires maintenance and repairs are incurred on a per mile basis. For example, when a $30 oil change is needed every 3K miles with 300 miles of trips to the grocery store and 2700 miles of Ubering, it'd be asinine to assign that cost in a way other than $27 of that going to Ubering.

A car requires fuel. The same logic as the oil change; $30 for gas to drive 30 miles to the grocery store and 270 for Uber can be uniformly distributed per-mile.

Nothing you said refutes my claim. All research requires some sort of funding. Humans have biases which can affect their judgment/work. If you think potential conflicts should automatically make a paper worthless, then you're basically excluding the vast majority of scientific work. Read the paper and decide whether its methodology and results are valid and correct. Don't just look at a list of sponsors and walk away - that's just intellectual laziness.

> Don't just look at a list of sponsors and walk away - that's just intellectual laziness.

Is everyone supposed to personally fully read every individual scientific study? That doesn't scale.

The only way it works is to have experts you trust to give you the truth, which is what the scientists are supposed to be, but the funding source undermines the trust.

Nah, you’re just lazy. You’re not supposed to read every single piece of research in existence. No one person does that. Not even the scientists.

But if the topic interests you enough for you to comment about it and there is a research paper that you can read, then just read the dang paper or let other people make decisions for you. Nobody has to give you the truth. And, on top of that, even if the results of research are quantified, there may not even be an unquestionable “truth” — the implications of the research can still be up to interpretation.

> Nobody has to give you the truth.

Then you have to figure it out for yourself. For everything. Which, again, doesn't scale.

At some point you do need to trust some people to make some decisions for you. But what kind of fool trusts someone with a conflict of interest?

Lots of research requires funding. And of course the funders will have a reason to part with their money. People aren’t going to pay for things they have no reason to pay for. Simply deciding whether a piece of research is valid after only looking at who funded it is a major fallacy that betrays the basis of the scientific method itself.

Science isn’t a matter of trust, it’s a matter of verifiable results. The results of a scientific research paper must be repeatable by a third party following the same methods. Go see the merits of the research: it’s methodology, its results. If everyone simply looked at a list of funders and went “welp... this research is biased and invalid”, then we would have hardly any “valid” research.

How exactly would you suggest people read the paper? The article linked to a brief [1] which says literally absolutely nothing about how they conjured up their numbers. And the paper itself is here [2]. It's rather worse than a paywall. Instead the paper is restricted to their "sponsors" until an embargo of up to 6 months.

This sort of behavior should not instill confidence in the paper's conclusions. And I think it was completely reckless of the Guardian to run an eye catching headline with absolutely 0 justification given to the numbers other than an implicit appeal to authority by calling it an MIT paper. Though such is the state of the media today.

[1] - http://ceepr.mit.edu/files/papers/2018-005-Brief.pdf

[2] - http://ceepr.mit.edu/publications/working-papers/681

I'm not sure if it's purposeful, or how long the hole will remain open, but you can see the full paper. Remove the "-Brief". [0]

The paper is fairly open about their methodology, and give access to things like the actual survey being answered, rather than just saying "a survey matching these criteria was used".

Most of their data apparently has come through Harry Campbell [1], and his yearly survey, which has it's own data and methodology out in the open [2].

I'm not remotely qualified to analyse it, but you can see the data from therideshareguy's survey if you're looking to critique the results of this paper. (I've edited this paragraph to try and get less push/offensive. I'm still not happy with it, but the aphasia is kicking my butt. Rest assured, I'm just trying to be helpful, and just wanted to point the direction to discussing the data. Still not happy with this phrasing either.)

[0] http://ceepr.mit.edu/files/papers/2018-005.pdf

[1] https://therideshareguy.com

[2] https://therideshareguy.com/2018SurveyReport

In other words, the paper is currently less than worthless since it can easily mislead people. At this point, it is little more than an appeal to authority.

Good point, but even getting this far is better than dismissing it out of hand because of a sponsors list. I do agree that the lack of actual paper does not instill confidence.

>Instead of giving in to a gut reaction, you should read the paper. All research must get funding in one way or another. If you exclude research due to funding sources and potential conflicts of interest, you wouldn't be left with much.

It makes sense to try and figure out what the funders would want the answer to be and see if the research matches that. If it does, shouldn't you be more skeptical?

For example, if Exxon funded research saying that global warming isn't caused by man or Walmart funded research saying that raising the minimum wage causes mass unemployment then it's pretty clear that they would benefit from the result.

In this example it looks like these companies probably just want to be associated with MIT (or they have an interest in other pieces of research) and I can't see any particular reason to suppose that they'd be invested in the outcome of this study in particular.

Every patron of every piece of research is hoping to benefit from it. I certainly agree that a reader should consider the goals of the authors and backers, and I would hope the authors would make both clear. I just get piqued when intellectual laziness steps in and says "don't read this, it's funded by biased sponsors (i.e. humans)!"

I think this is a very salient point... it's essentially ad hominem and I'm tempted to fall into this fallacy. Thanks!

>Every patron of every piece of research is hoping to benefit from it.

A) Not always. Bill Gates funding malaria research doesn't benefit him.

B) If you benefit from the research being accurate and truthful that's very different to only benefitting if the research yields a particular answer.

I don’t see any of the these competing with Uber/Lyft. They may be suppliers. Where is the conflict?

Why would those companies want to smear Uber? Many of them profit from uber. Uber sells a ton of gas and cars.

Additionally, Uber usage encourages car ownership and usage, as opposed to cycling or public transport.

Does it? I'd have thought the opposite. The whole idea behind "ride sharing" is not needing to own a car, but being able to benefit from one when needed.

Some people believe that Uber basically incentivizes people to switch from public transport. Hence, you’d have more cars on the road. Along the same lines you could argue that there are few people who already own a car who would sell their car just because of Uber

That’s the idea behind it for the passenger. Remember there’s another person on every side of your Uber transaction, who might have recently bought a car but would not have otherwise.

Yes, but to spell out the obvious: There are a lot more passengers than drivers. This should result in fewer personally owned cars in total.

How many people have you met who had a car but really gave it up to Uber everywhere? Maybe in large cities like SF or NY but for the vast majority of Americans Uber and Lyft supplement their car usage rather than replacing it.

Uber is just a taxi company. You can hardly expect car makers to hate taxis or carpooling.

TNCs are accelarating the trend towards having fewer cars and more fuel efficient cars. Basically, they are trying to slow down TNCs so they can maintain their current valuations and prop up shareholder value.

I would think the idea is that Uber/Lyft, in the long run, disinsentivizes individual car ownership (why own a car when I can take an uber?) except for those doing the driving for Uber/Lyft. So the overall dynamic might shifts from lots of people owning cars (but relatively low utilization rate) to a few people owning cars (with very high utilization rates).

This study only confirms the unspoken word for many years. Looks like these ride-sharing services are a race to the bottom, the only ones that are better off are the users.

Another conflict of interest worth examining is that of readers of these studies. Is it in your interest to discount or promote the study? Does your lifestyle, paycheck, politics or identity (as in identity politics) bias your read?

What would a rejection of business models such as Uber's mean to SV, it's means of wealth, it's self-image?

> “The companies are losing money. The businesses are being subsidized by [venture capital] money … And the drivers are essentially subsidizing it by working for very low wages.”

Last time I pointed that out I was downvoted for some unknown reason.

My neighbor was talking about buying a new car to drive for lyft/uber and I was like "the trick is to tear up somebody else's car." We'll see if he heeds my advice though I kind of doubt it since he has an MBA and I'm just the resident slacker who happens to know the business.

I did the math on working for SkipTheDishes last year (Uber doesn't operate in my city). I really wanted it to be a good idea, but once I calculated gas, insurance and wear and tear on the car, it was an incredibly poor deal. That's with a paid off, cheap, car, too. Not for me.

Yeah. Do you think that depreciation shouldn't be 39 cents a mile for an old bucket? Or do they have requirements for the age of your car?

If you have like a 2000 camry (which runs forever) depreciation seems to be virtually 0, especially if you buy the car used and only pay like 1 grand.

Also, I can imagine if you're just shuttling food around instead of passengers, you can get away with a worse car. Nobody wants to hop in a bucket and go somewhere, but food delivery doesn't matter.

I use Mr Money Mustache's figuring that each mile costs $1.55, then convert it to Canadian. $1.19 per km. Even a 2000 Camry will depreciate if you put enough mileage on it - if I was shopping for one I'd pay $5000 for under 120,000km, but not even a thousand for over 280,000km. But yes, you can get away with a bucket for food delivery. I'd say the best way to do it is on a scooter, but then you're really putting your life on the line every night.

Those old Japanese sedans are good for far more than 280000 km if you keep up on maintenance yourself.

Yes, anecotes are not evidence, but this article is interesting. https://jalopnik.com/5885287/how-i-put-750000-miles-on-my-ho...

And besides, you can buy a car for 4k with a lot of miles. At that point it's like a dishrag. You use it to do your job until you need a new one. Blows up by the side of the road? Tell your customer that happened, buy AAA, and depending on how bad it is, you can fix it yourself after it gets towed home, or junk it and buy another.

Or am I missing something?

I don't know where you live, but when I looked at for Colorado back in 2010, the state's Public Utility Commission regulations require cars to be 7 years old or less.

Apparently times have changed.

http://aircarecolorado.com/index.php/consumer-information/20...

If I'm reading this right, this just means if your car is older you have to get it inspected.

I somehow doubt that classic cars (Mustang, Camaro, Corvette, 510) are banned anywhere in the country - they might have to meet more stringent tests.

They are, I agree, but if you're buying one that's 18 years old than you haven't done the maintenance yourself, and it's hard to be sure all the previous owners have done all the maintenance items. If I bought one brand new I have no doubt I could keep it running for 500,000km, but that's not the case in this hypothetical.

I didn't know MBA's were that squeezed that they need second jobs.

An MBA does not guarantee a good job.

I think he is having a hard time getting a job that doesn't pay peanuts, kind of suspect it has to do with his English skills (he's from the Ukraine or something) but it could just be the market is saturated with newly minted MBAs.

MBAs are different from engineering degrees in that while a MBA from a top school is super valuable, a MBA from a so-so school is, as far as I can tell, worth very little. Keep in mind that one-year MBAs from disreputable schools are often advertised to working people.

I mean, you do learn things; my understanding is that it's sort of a 'survey degree' that gives you a shallow treatment of a lot of different business disciplines. If they would have let me take the MBA without an undergrad, even at a so-so school, I would have done it a few years into my own adventure running a business, and I think it would have helped me. If you have management experience and skills, a MBA even from a not so great school can help. But I think the difference between a MBA from a meh school and a MBA from a top school is overall far greater than the difference between an engineering degree at a meh school and an engineering degree at a top school.

The entire point of the MBA is the networking opportunities and joining the alumni club. The content can be got for a fraction of the cost, or even free. The success of the top MBAs is therefore self-perpetuating. And there is literally no point in doing one outside of the top maybe 20 schools, because there is no one there or in the alumni network who can give you a foothold.

I think you are being too absolute.

There is some value to the content, even though I totally agree that the contacts are dramatically more valuable than the content if you go to a good school.

Personally, I find that finding management and business content on my own is actually harder than finding Engineering content on my own; management and business training is full of tony robins style confidence men, and it's difficult, for me at least, to sort out what is actually worthwhile. For that matter, just an overview of what sort of professional to hire in what situation would be nice. (For instance, if you are just looking for tax help and don't plan on selling the company, an 'Enrolled Agent' is actually better than a 'CPA' though the two certifications are of similar difficulty; the EA focuses on dealing with the IRS, while the CPA has more of a focus on the accounting you would need if you are selling your company or something.)

A MBA below a certain level is worse than not having a MBA at all, people just assume you couldn't get a job.

> Last time I pointed that out I was downvoted for some unknown reason.

Hard to believe but the number of votes something gets != the quality or accuracy of the statement.

LOL, I'm feel pretty much trained to see a top-voted "Thanks again to all the VCs for subsidizing my taxi rides!"-type comment every time I click to the HN discussion on stories about Lyft/Uber valuations and investments.

I don't get it. Taxicabs such as in NYC are famously expensive to buy into, and yet drivers somehow afford it and make livings on them. So if they are clearly not losing money, why is it that a company that's supposed to be vastly more efficient due to use of computers can't make a profit? Are the tech overheads really that high?

Because they're spending it on other stuff. Lots of those thousands and thousands of engineers are working on developing other products not the least of which is self-driving cars.

My theory is they are attempting to put the competition out of business by running at a loss then adjust the rates to where they can make money which, coincidentally, will be be almost exactly the amounts the "evil" taxi companies were charging.

I could be totally wrong but if I were a betting man...

That's still a win for consumers, because they certainly raised the bar for customer experience. They run leaner than old-fashioned cab companies and can keep prices lower at the end too.

Is it a win for society, though? If they ended up being a stronger and more global monopoly than cab companies, the savings from being "leaner" would just end up in the pockets of the few and everyone else would not be better off.

That's still a win for consumers

No it isn’t, because externalities. With Uber dodging all its taxes who is paying for the infrastructure and services it relies on?

If you are an Uber driver in London neither you nor Uber is paying any NI but you’d still expect the NHS to treat you...

By the way this behavior is illegal in many countries: https://en.wikipedia.org/wiki/Predatory_pricing#Legal_aspect...

Uber is probably profitable in NYC (and if it isn’t, it could be by raising prices and cutting costs). The question is everywhere else.

And NYC taxis relied on mostly immigrants driving 12 hours a day; in cheap fleet cars.

The medallions (for a long time) were an appreciating asset. So only the interest on the loans were an actual expense. 5% interest on a million dollar loan is only 50k a year. And they’d offer split it amongst drivers (two or three split a car).

Taxicabs such as in NYC are (were) monopolies. The price you paid was far above what the market rate should have been, which is why drivers were able to make livings on them. Uber/Lyft are simply forcing prices back down to the market rate which is where the prices should be in a free market. Driving isn't really something that should be a career.

> "Why is it that a company that's supposed to be vastly more efficient due to use of computers can't make a profit?"

Well Uber/Lyft are probably focused on growth now. They will make plenty of profit once they dominante every city with driver-less cars.

Yeah, but the taxi driver had to finance both his/her medallion and the car, which in most cases would not double as a personal car for everyday errands (as somebody else would drive it during their shift). Those costs have been driven down as well.

If the GP is correct and the companies are losing money and subsidized by venture capital... Then no, they aren't fixing the process down to market rate. They are artificially delaying the market rate with venture capital.

Yep, and ruining life of lots of people in the process.

But hey, all for big money!

I do not see how subsidizing work is "ruining life of people".

I, for one, receive competitive salary from market and would love my work be additionally subsidized by VC. Ruin me all you can.

Subsidizing poorly paid work. Work that on the median, if the research is correct, does not even make 50% of minimum wage.

> "Driving isn't really something that should be a career."

Why not?

This question would have made sense 10-20 years ago.

No, I'm still confused. What is the problem with being a taxi driver for life and expecting a good wage?

Only middle class professionals have "a career" and therefore deserve to have enough money to live on, don't you know.

It's the primary reason we don't need a minimum wage - working in the service industry or any other relatively unskilled work isn't "a career" so it doesn't matter if it only pays 2 bucks an hour, so goes the reasoning because nobody should be expecting to do it for long or make a life out of it.

It's myopic.

If teachers can’t be expected to support their family off their income, why should someone doing something that can be crowd sourced as a side gig? Just because I can make $15 tying peoples shoes doesn’t mean that I’m entitled to support a family off of it.

Because it is in your(society) interest that people can support themselves and their families with just one job. Otherwise you end up spending more on benefits and support not to mention on all the problems that come with chronic unemployment.

>> If teachers can’t be expected to support their family off their income,

Why the f*ck should teachers not be paid enough to support themselves and have a life? Wow.

Low barrier to entry.

> and expecting a good wage

Wait, you added that part just now.

I don't see why you couldn't drive a taxi for a living (though I don't know if that is all that was meant by "career"), but taking for granted that you will be paid well seems off.

> No, I'm still confused. What is the problem with being a taxi driver for life and expecting a good wage?

No, I'm still confused. What is the problem with being an elevator operator for life and expecting a good wage?

It makes perfect sense now.

In my country (Poland), cabs are not regulated very heavily, which leads to a flood of drivers, and low prices. In result, in many towns even by driving 10 hours a day (most of which is spent waiting for customers) you're making not much above the minimum wage. As a result, driving a cab has become in large part an extra source of income for retired cops or other people who retire early (say in their fourties).

I don't see nothing wrong with that - it's a job that requires no qualifications, has no boss, flexible hours, is not demanding physically or intellectually. In short - a dream job for many people. It only makes sense for it to pay less than say a grueling job at a factory.

> 'Driving isn't really something that should be a career'

I haven't read more ambiguous and ludicrous statement on here ever.

Please evaluate your point, because if you are right then a huge number of workers across the globe should not have a career in driving.

> The price you paid was far above what the market rate should have been, which is why drivers were able to make livings on them.

This sentence makes no sense to me. How can something's "market rate" be non-profitable for the producer? If you have market forces acting on something the balance of forces will necessarily push the price higher than the price of production.

If something doesn't make sense to sell because it's too cheap, the market actors will not produce it, lowering the supply and decreasing the offer, thus increasing the price. eventually, you have to reach a price balance somewhere higher than the initial cost of production, for at least a subset of the producers.

> How can something's "market rate" be non-profitable for the producer?

You are confusing 'making a living' with making something. Even if a driver only nets $3.37/hour, that is still 'profit'. Just not enough to feed/house/etc yourself if it's your primary source of income.

In a way, monopolies are good like elevator limits are good. It's not the support of the elevator that's the problem but the discomfort of people being crammed into the same space.

When the same market can suddenly be open to anyone you get people cramming into elevators and buses so that everyone is uncomfortable.

The entire US revolves around gates and monopoly like jobs. The greatest gate being the immigration gate. Technology empowers everyone and moves everyone towards the mean. Which is bad for groups that are above the mean.

As I understand, it tends to be profitable in cities where it has operated for longer time, but it operates at a loss in cities where they've entered more recently due to costs related to marketing for driver acquisition, customer support, fraud, etc while ramping up the fleet size and establishing a stable physical presence.

As for drivers, my anecdata is that many claim to make "good money" (in their words). I've had a guy say Uber doesn't make him money, but then he followed up by saying he's a retired guy just doing it to keep active and that he owns two convenience stores...

Uber is losing billions and their drivers are making peanuts. That sounds sustainable.

I am a bit curious about the dockless bike shares too, I suspect the same thing.

I'm not as certain about that. Potentially optimistic, but I could imagine bikes taking on a larger role as we move to self driving cars.

If you read threads about biking[0], people seem to be motivated to bike more than they are motivated to drive. Although these same people are stymied by negative conditions. Self driving cars could improve biking conditions by opening up roadways, making them safer, providing better point to point transit.

[0] https://news.ycombinator.com/item?id=16420271

I think I agree with the biking in general, self driving cars will probably make biking a lot safer both by reducing the chances of an idiot running into you, and reducing the number of parked cars on roads (riding beside parked cars is scary, because you are never sure when a door is going to open into you).

I don't think that I necessarily agree that this means bike shares will succeed though, I think private bike ownership has a lot going for it.

I have a bike and there are bike shares around me. I am still trying to figure out a policy, but I lean towards bike share for everything short, because it’s like a taxi, you don’t need to go back to your bike. But bike share are crappy, so for longer distance I need bigger wheels and gears.

I was skeptical about the business model, the bikes cost a lot, are rented for cheap, and for some reasons the companies go head to head in the same towns instead of covering different areas.

And if they kill each other and the winner raises the price, I suspect Detroit wins.

Yeah, the biking model seems fairly easy to speculate on, but sort of hard to pin down. Here's some speculation from a per bike perspective.

Revenue

  daily rides*365*$1

Costs

    $250 per bike
  + $15 per month for maintenance
  + 20% chance of catastrophe amortized over the fleet
  = ~$500

+ rebalancers + insurance + overhead?

So maybe 2 rides per bike per day gets them in the green?

My city recently got them, and we currently have more bikes than NYC. It was rough at first but people are taking them a lot now, and its increased bicycling in general even outside of bike shares.

It was never designed to be sustainable. Why does nobody get that yet?

The only reason Uber and Lyft work is that there are a ton of people with limited job skills, who have time on their hands, are short on cash, and need to spend their extra time trying to make money. Sure, there may be "bored people" who do this because they're retired or whatever, but that's a tiny minority. Most people do not become part-time cab drivers because it's more fun than what they would normally do with their free time.

A significant amount of our economy is dependent on people having two or three or four jobs, and a lot of those people live in or very near to cities, and have cars. If wages improve across the board, or people move farther away from cities, or people get rid of their cars, ride-sharing is screwed. Much of the "gig economy" is dependent on similar conditions. If we had better access to jobs and a living wage, a lot fewer people would be "gigging" to get by.

Another reason (there's probably dozens) why the gig economy is incentivised today are things like rising health care costs, rising cost of housing, rising cost of education, and lack of availability to retirement or pensions. We all know we're supposed to save, but it's harder and harder to save. So people have to pick up gigs.

My partner is a teacher and gets paid well for her position, but she still has to Airbnb out a room in her home because the insurance, taxes, and mortgage are absolutely insane. If she makes it to 25 years or whatever it is without killing herself from stress, maybe she can finally retire. Except, oh wait, the state isn't funding the teachers' pensions and will run out of money in eight years! Fun.

Point is, the gig economy is here because almost every strata of people below "upper-middle-class" have been getting slowly screwed for decades. It's not designed to give people a working income. It's designed to fit into the cracks in the system - and the cracks keep getting bigger.

It is also basically a loan against your car, which you pay back either in reduced value when you sell or increased maintenance.

All good points.

I used to drive a taxi - I fell into it when I needed a job but was overqualified for just about everything. I learned a lot from my passengers.

The taxi company I used to drive for has adapted. I think they'll survive until uber runs out of money, simply because fleets of similar vehicles are cheaper to maintain. A Prius will last 400,000 miles, with rebuilt batteries and cheap parts from a boneyard (retired/wrecked vehicles).

The taxi company now leases unbranded cars that can be used by drivers for any of the app-based services. The company's contracts pay better than non-surge uber fares, which motivates the drivers to take care of the company's contracts too.

> Point is, the gig economy is here because almost every strata of people below "upper-middle-class" have been getting slowly screwed for decades.

I call the phenomenon "economic cancer".

But it's not even sustainable for the big companies. Even with screwing over their please-don't-call-them-employees, they still need constant infusions of investor cash to stay afloat.

They are basically biding their time until driverless cars take off it seems.

Driverless cars in urban areas are decades away

I saw one yesterday. There was a driver but like... come one, decades?

When driverless cars are common on midwestern highways every night, they will start moving into complex urban areas. We are very far from cars navigating downtown NYC, Seattle, SF, Boston, etc.

Do you live in NYC, Seattle, SF, or Boston?

Yes, Boston, and when can I order my driverless car to pick me up?

A few months ago if you ignore the safety driver [0].

If cars with safety drivers don't count, nearly a year ago if you move to Pheonix and get lucky [1]. They're apparently planning to launch in more cities "soon" (though I can't find a list or date) [2] and they've recently got permission to start charging passengers and intend to by the end of they year [3].

So I think "decades" is an exaggeration.

[0] https://www.theverge.com/2017/12/6/16742924/lyft-nutonomy-bo...

[1] https://www.theverge.com/2017/4/25/15415840/waymo-self-drivi...

[2] https://www.theatlantic.com/technology/archive/2018/01/waymo...

[3] https://www.digitaltrends.com/cars/waymo-now-a-full-ride-hai...

Re "midwestern highways": haha, I don't see a "self-driving" car navigating the I-90 in Chicago anytime sooner than SF. ;) At least SFBA has super mild weather that makes the obstacle detection problem much easier. Here there are only two seasons: winter and road construction.

(But yeah, we are very far from cars navigating urban areas, or indeed anyplace where weather is inclement and so are people.)

Pretty sure driverless cars are being tested in almost all of those cities already.

The Falcon Heavy took five years to develop and it's basically just a bigger version of the same Falcon 9 rocket they've been sending up for years.

Even if you have a driverless solution today it'll take years to test it and get it certified.

A gas-powered, highway-capable, driverless car feels callous. I hope those algos are good.

Right. That must be why a Waymo drove itself past me in the Bay Area two weeks ago.

5 years ago I was told the same thing, and 5 years before that. Maybe 5 years from now, but it’s been the same story forever.

You saw a driverless car (with a safety driver) drive past you five and ten years ago?

In October 2010, Google announced that they'd logged 140,000 miles with a self-driving car, with a driver, including through San Francisco and a lot of California [1]. So eight years ago is possible, and I'm willing to grant a little hyperbole here.

[1] https://googleblog.blogspot.com/2010/10/what-were-driving-at...

Honestly, it really hasn't been the same story forever.

In the 2004 DARPA Grand Challenge, of 21 teams entered, 15 qualified to race on the course, and none finished the 240 km course. The best result was 12km. That was off road, with no requirement to obey traffic laws or other cars to hit.

Since 2009, Google/Waymo has 5 million driverless miles under their belt.

Is it 5 years away? I don't know, but this is not the same story forever. This is iterating and improving at a breakneck pace.

That's the problem with exponential development. It seems like you're getting nowhere for decades, then all of a sudden it's starting to amount to something, and in the span of maybe a year or two it goes from impractical to plausible to obvious and ubiquitous.

The problem with predicting these curves is there's usually a confluence of factors that lead to that tipping point. When the right algorithms, hardware, and software are combined it'll be obvious in retrospect, but right now we're still fumbling around with primitive solutions.

When will there be a TPU-type device suitable for in-car use? When will there be adaptive deep-learning algorithms available that can work in the demanding real-time environment of a vehicle? When will enough testing be done that we know such a solution can work without endangering people?

It will happen, but pinning down when is very hard. You'll only know when you're close, and by then you're already flipping from impossible to inevitable.

I find it interesting how the same people that have no problem accepting that the last 10% of a random software project accounts for a significant portion of the total time spent, can at the same time be so unreasonably optimistic that a whole sphere of tech can go from like 70% to 100% (where 100% is also the minimum amount required) in a really short period.

Probably for the same reason software developers can't estimate tasks. At least for me the problem is that I figure out the algorithm at a high level and base my estimate around how long that will take me. But inevitably there are platform gotchas, or the API doesn't work the way I expect, or I forgot/didn't know about edge case. (I've done this enough that I have an idea of what kind of things can go wrong now)

I think the optimists are thinking "oh, the high-level problem of image recognition and building a 3D model of the area around the car is pretty much a solved problem, great, done!" But in fact, it's all the edge cases that will kill you. What happens when it is dark and rainy and the car in front of you is black, with no license plate? What happens when the car in front of you hits something in front of them unexpectedly? What happens when the car gets a flat tire? What happens when someone doesn't look in their mirrors before changing lanes? What happens when your "there's a problem" solution (like, say, stopping or slowing down) is actually not a good solution?

You would have to defend that humans make good decisions in such cases. I would argue that, for the majority, they do not.

I have been in all of those situations except for the black car, and the humans involved all made spectacularly poor decisions.

People who claim that self-driving cars will have failure modes far underestimate the failure modes that humans have.

I think the disagreement is what the last 10% are. I see urban driving as part of the 90%. My 10% are rural gravel roads with puddles, snow covered roads and similar bad road and weather conditions.

I see those stupid robot cars all over the Phoenix metro area these days, whole packs of them roam Chandler/Tempe/Scottsdale areas.

Now they have permits to run around 100% humanless apparently.

Urban areas are easy. Snow is a hundred times harder.

I see a lot of driverless ubers here in pittsburgh

Yeah, but whoever is first to market on driverless (e.g., Tesla) has already said they will have a separate network for letting others use your Tesla to subsidize your ownership cost. Aka, your Tesla won't be a part of Uber's driverless fleet.

So, at best, they become a 40-billion dollar driver/rider match-making algorithm and a pretty CRUD app. Unless Uber itself is working on autonomous driving technology. It's so easy for drivers and riders to switch between ridesharing apps (e.g., ever see an Uber driver that also has a Lyft sticker on their car? I have, many times), I don't see how any of them can solidify a competitive advantage of sorts long-term.

Isn't Waymo already first to market?

What product do they have on the market?

Self driving cars... in Pheonix.

But looks like I was wrong. They do have a self driving car service running for a group of testers, but apparently it is currently free so I don't think it counts. On the other hand they've got permission to start charging and have said they plan to this year, so I'd still expect them to beat Tesla.

Source: https://www.digitaltrends.com/cars/waymo-now-a-full-ride-hai...

> Unless Uber itself is working on autonomous driving technology

https://www.uber.com/info/atg/

Uber will exhaust their runway prior to reaching a level of autonomy sufficient to replace drivers. Quote me in 3 years.

Don't look at me if you're expecting an argument :)

Uber's autonomous driving technology was at the core of the Waymo/Uber lawsuit/scandal. I'm a little surprised by how easily Google/Waymo gave up and accepted a settlement.

That's what I never really got. The fact that self driving cars will be the savior for Uber.

Let's assume, for the sake of argument, that the concept is viable in urban areas within 5 years and Uber puts a massive fleet of self driving vehicles on the road.

While it's certainly true that they wouldn't have to pay drivers it would be a massive shift in capital investment.

The "genius" of Uber is shifting the necessary capital investment for hundreds of thousands of vehicles onto the drivers.

Assuming one car costs 30K (which I think is on the very low side) it costs 3Billion to put 100'000 cars (which also seems very low with Uber's global ambition) on the road.

That's an upfront investment currently incurred by the drivers.

Also, where does Uber store all the cars outside of peak times?

So it has to buy parking.

What happens when they break down?

Servicing.

How often do they have to replace their fleet?

$3 billion every 5 years.

> Also, where does Uber store all the cars outside of peak times?

> So it has to buy parking.

Rent parking spaces in people's driveways! :-)

I share your opinion.

Also, I never understood what kind of problem companies are trying to solve with self driving cars to be honest. Traffic in cities will be the same, if not worse. And I consider driving as one of the things I really enjoy doing. Why take that away?

Well I think there are two counter points: Uber already has a running business, so it's relatively easy for them to go to a bank and say 'Here's how much a fleet of cars cost, here are the running costs, would you finance us $3Bn for it'. The answer is almost certainly yes, and if not then venture capital would probably fill the gap.

The second point is that there are two keys to making money out of this: Have self-driving cars, find customers to rent the self-driving cars. Uber is already established in the second part. So it might be true that another company buys the cars and tries to run the business, but uber has the established customer base.

In my opinion the future of self-driving cars inevitably ends up with one of the big players buying uber to allow them to monetize their fleet.

It's sustainable because we're on the cusp of the autonomous vehicle revolution. https://www.nytimes.com/2018/02/26/technology/driverless-car...

This is similar to how the huge army of people stuffing DVDs into envelopes at Netflix is going away. It might be slow, but I don't think there will be tons of people watching DVDs from them in 2030... https://www.cnbc.com/2018/01/23/netflix-dvd-business-still-a...

I hope you realize that ripping DVDs and putting them up for streaming is pretty easy, everyone was doing it before Netflix was, compared to having a fleet of autonomous vehicles that can safely operate in a multitude of urban environments, something nobody has ever done before.

You have to question the leadership of a company that's willing to throw untold billions and counting on a long-shot bet that they'll eventually have these magical cars and everything will be fine.

Once Uber can do it, soon afterwards everyone can, and what makes you think Uber will do it better when they've already had to give up so much to invent their own self-driving car solution?

Their business model is completely ridiculous.

Self driving cars have nothing to do with what Uber has been up to, and having a lot of cash isn't really a competitive advantage when your competitors are Google, Tesla and other car manufactures.

Uber has a lot of cash by taxi standards, but nothing compared to car manufacturer standards.

> It's sustainable because we're on the cusp of the autonomous vehicle revolution.

We still have drivers on subway trains. When those drivers lose jobs to autonomy, maybe we can think about being on the cusp. Until then, I see it as a fantastic story that can be used to milk VCs for cash.

At <$4/hour, it's a better investment to automate a fast food restaurant like McDonald's or Burger King. They pay twice as much for labor. Pouring a coke and cooking burgers and fries should be a pretty straightforward challenge. They've already done Pizzas.

Subway trains carry hundreds of people, so the cost of the driver for each passenger is low.

Also, subway systems are monopolies with strong drivers' unions. Subway managers have no strong financial incentive to reduce costs because the taxpayer foots the bill. In contrast, if Uber doesn't produce a driverless taxi service soon its management will be fired and will miss out on billions of dollars in bonuses.

I think we'll see driverless public taxis in Phoenix before we see driverless subway trains in New York. Self-driving trains are technically easier to develop, but self-driving cars will win thanks to the efficiencies of the free market.

Automation on subway trains is almost never about saving costs - even well paid drivers make up a very small percentage of the operational costs of a subway. The vast majority goes on maintenance.

In most cases the costs imposed by a wave of city-crippling strikes will far outstrip the minor cost gains from automating the rail line, so it only makes sense to actually automate and fire the drivers if the goal is actually political.

Subway drivers comprise a strong component of a country's labor power (because of their power to shut down critical infrastructure) and the alliances they typically hold with other unions and their political donations cement that. They don't just offset the power of the government they work under, they offset the power of executive/shareholder power in general.

Since labor and union power is largely what held income inequality in check until the 80s, the political goal behind crushing them is pretty clearly about increasing the wealth and income inequality chasm still further.

> union power is largely what held income inequality in check until the 80s

Would love to see actual evidence that this is true.

Here it is

https://voxeu.org/article/union-power-and-inequality

The link you posted only analyzes the relationship after 1980. It also doesn't compare multiple sources of inequality. That's not evidence for "union power is largely what held income inequality in check until the 80s"

Here's another study (that actually cites the one you linked) covering the same time period and shows multiple other factors having greater impact. https://www.imf.org/external/pubs/ft/sdn/2015/sdn1513.pdf

No it absolutely doesn't.

"Technological progress and the resulting rise in the skill premium (positives for growth and productivity) and the decline of some labor market institutions have contributed to inequality in both advanced economies and EMDCs."

Emphasis mine.

That ^^^ was literally the first reason given in the article.

The second point it makes is about the role policy-making plays, which of course is probably as important, but is intimately connected to the presence or absence of union power because who the hell do you think lobbies for those policies?

Institutional support (donations, political support, control of voting blocs, policy research, etc.) behind those policies (e.g. raise minimum wage) comes from unions whereas the policies do the opposite (e.g. lower minimum wage) come from business lobbies and high net worth individuals - who have opposing interests.

It's true that a decrease in labor power has probably contributed to rising inequality. That's not what you stated though; "It's a factor" and "it's the most important factor" are separate points. If you read the study I linked, you'll see that in advanced economies globalization and the skill premium have had roughly the same or larger impact as changes in labor institutions (which is a much bigger category than just "union power"). Regardless, both studies only show effects after 1980, not before.

> The second point it makes is about the role policy-making plays, which of course is probably as important, but is intimately connected to the presence or absence of union power because who the hell do you think lobbies for those policies?

Organized labor frequently advocate for policies that benefit their members at the expense of non-members (for example, licensing requirements) with ambiguous or detrimental affects on inequality. You use the example of minimum wage, but that's an ambiguous example too; we have some evidence that a high minimum wage actually decreases total low wage worker earnings[1], but a small increase (at least in the US) would probably be beneficial. To quote from the study I linked earlier

"Stronger labor market institutions could increase unemployment rates, reduce the wage differential between high skill and low-skill workers, and affect the labor share of income. The overall impact on income inequality, however, can be ambiguous: they increase unemployment, which tends to raise inequality, they can reduce wage dispersion, which tends to lower it, and they increase the wage share, which can have an ambiguous effect on inequality"

To be clear, it might be true that a decrease in labor power would be associated with policy that increases inequality but that's a non-obvious conclusion.

[1] https://evans.uw.edu/sites/default/files/NBER%20Working%20Pa...

>If you read the study I linked, you'll see that in advanced economies globalization and the skill premium have had roughly the same or larger impact

The paper you linked was not studying that. It was not measuring the impact of union density on inequality whereas the study I linked to had a methodology for measuring the two, correlating them and teasing out a causal impact. Your paper was simply going over the various issues surrounding inequality and talking about them.

The other stuff you mentioned is a combination of wrong and not relevant to this topic.

Incidentally, that stuff about licensing requirements being "the bane of every worker's existence" that you read about can typically be traced back to lobby institutions that are linked to Charles and David Koch (e.g. CATO). They started publishing "research" and press releases about the onerousness of stuff like hairdresser regulation in the 90s and early 00s after some of the brothers' high profile fights with the EPA. Isn't it fun to learn where your propaganda comes from and why? :)

The SkyTrain in Vancouver, Canada does not have drivers.

It has been in service since it was built for the 1986 World Expo.

Autonomous trains are not nearly as widespread as they could be, but this is not for technical reasons - it is for political reasons.

Pretty sure one of the Boston subway lines is autonomous (from the airport?), along with a smattering of subway lines around the world.

Blue line? Nope, it has a driver.

Paris' metro # 14 is driverless.

The new lines under construction (15, 16, 17 & 18, which will serve the greater Paris area) will also be fully automated.

One of the reasons is that the driver also doubles as emergency person. With autonomous systems one has to have staff ready to reach each section of the tracks quickly to lead evacuation from a tunnel in case of fire etc. A driver is trained to do so.

If that had to drive down a busy street it wouldn't be driverless.

The way it's configured it's basically an elevator.

I think Paris subway is driverless (at least some lines I traveled on). https://en.wikipedia.org/wiki/List_of_automated_urban_metro_...

The problem i have seeing this comparison is netflix was making good money in their original mail business as far as i remember.

Their venture into digital was ahead of the curb, allowing them to be even more successful and expand their business beyond distribution.

If the self-driving-taxi is right around the corner i guess that can save uber, but it's not like netflix was on a timer to like uber is to transition their business model.

Heh, Netflix if anything probably is desperately relying on DVDs still...this time selling them. All their original series, $20/30 a season; I doubt the revenue solely from streaming could even pay for the production costs otherwise.

And Uber...their whole point was being an annoying, even predatory middleman who shunt all their costs onto their "workforce"...you think they are going to thrive when they need to bear all the risk and expense themselves, as well as be unable to break laws?

The driverless revolution (whenever it takes place) seems to favor fleet management companies, not dispatch companies.

It lowers the barrier for entry to pretty much anybody, with fleet manager taking care of car washes, interior clean-ups, refueling, parking at idle hours, ongoing maintenance and fixing occasional flat tires.

What part of Uber/Lyft business model makes them more sustainable when compared to Hertz, Avis, Budget, Alamo, Dollar, Fox Rent-a-car, ZipCar, Tesla Driving Network, any local car dealer with excess inventory, Ford- or Mercedes- or any other maker-branded service, or a small mom-and-pop operation with just a couple vehicles in their fleet?

I'd say that Uber/Lyft would be better positioned to take advantage of driverless vehicles. The hard part is the tech, personal for fleet management is a cost center. They have already mastered outsourcing low-skill cost center type jobs to large numbers of poorly paid contractors. And both companies have business relationships with fleet management companies.

So once either company successfully develops proprietary IP that enables fully autonomous cars they should have a clear road to profitably. They can use their existing relationships with fleet management companies to handle that part. And that is a mature industry, so the presence of a lot of capable competitors will keep costs down for Uber/Lyft. If they do need to do a bunch of hiring for new low-skill positions they can probably outsource it easily. I think the major winners will be tech companies and car makers. I don't think the fleet management industry will capture the majority of the profits, but they will probably get a minor portion.

eventually they will raise prices, and hope everyone is out of business who competes with them.

There's so much irony here. The only way they'll be able to maintain a monopoly is with regulation, and they're the first to ignore regulations.

If in the future they get their coveted monopoly, won't it be sweet when someone flouts the rules and undercuts them?

Your comment made me remember that Richard Stallman calls Uber for Guber (Refering to Goober; another word for a peanut), because they pay peanuts to their drivers.

That seems too low. Most drivers I use have been doing it for years. They wouldn't at those rates.

The number is a bit deceiving. As the article states, that amount is after you account for insurance, gas, wear/tear on the vehicle, maintenance, etc... So really the $3.37 is their "profit" before taxes are taken out. I am actually surprised it is that high. A driver working full-time in a city or area with high demand will put depreciate the value of their vehicle and drive costs up at a much higher rate than the average person.

For every one who makes it there's probably (wild guess) ten that lose money after working a few shifts and never turn on the app again -- most people are like "I can sit my ass on the couch and not make money plus not waste my gas making billionaires even richer."

Like all things there's a learning curve before you can consistently turn a decent profit too.

You sure? I personally know people doing it as their primary income in a top 5 us city in pop. It's a grind.

Doesn't your question prove the GP's point?

Not really, they've been trying to get a different job that entire time without success.

The recent internal Uber study found that long-term drivers learn how to optimize their rides for the highest fares. So there are significant differences between what the median driver makes and what the "pro" Uber drivers make.

This is the concern I hear from policy makers. If Uber/Lyft drivers are "optimizing" their rides and only seeking out the most profitable routes and areas, then cities no longer have a egalitarian transportation system.

Need a ride and you're in an obscure part of town? Welp too bad.

Taxis did this 100x worse.

I haven't read this study but I the past I've often found the depreciation figures to be higher than what they are in real life. They sometimes kind of assume you just buy a new car at the dealers and then two or three years later trade it in for a new car which means every three years or so you lose 50% of the cars new cost. Almost no one hard up does that. Get good deal on a 3 yr old car, keep it 5 yrs, your costs are much lower.

As a former pizza delivery guy, this seems odd to me. Before expenses, I’d make between 12 and 20 an hour depending on the night. The car I drove then had a KBB value of less than $3000 and it would have been eligible to use as an Uber. I just don’t see how you could possibly have such high levels of expenses unless you were paying like $600 a month for your car.

As a passenger, I'm very often in $40K+ vehicles. Even on a 60 month loan, that'd be over your $600 number just on car payments.

In 200+ rides, I don't think I've ever once been in a $40k+ Uber vehicle unless I've used Uber Select.

hm. It appears I'm off on my car prices. I thought japanese minivans were in that range, and with pool, those are really common. looking, they look closer to $30K than $40K if you don't spring for the extras. doing a survey of car manufacturer websites, my impression of how much vehicles cost appears to be around $10K high across the board. The base model honda accord is only $23K? that is way less than I thought.

I use uberx to work, and pool home most days; I've used select once. I think I get a Mercedes C-class at least once a week, some of them looking pretty new. Oddly, I almost never see BMWs. I remember the other night I got in some giant four door American pickup that looked new and very expensive, but I don't know enough about trucks to recognize the model to verify that impression.

Still, the standard Prius is gonna be like $400/month on a 60 month loan, and that's just the loan. I imagine that there would be much value in the vehicle after those 60 months, if you drove full time in it, and I imagine the Prius has lower operating costs than most vehicles in it's class.

I do occasionally get tiny economy cars... but not very often, which seems weird, as if the major cost was the car, you'd think drivers would optimize for that by buying smaller cars, but that doesn't seem to be the case.

Honestly, if you're buying a new vehicle to use for Uber you're insane. Perhaps they got more people roped into that or leasing than they ought to have and that's responsible for these issues. But you can get a used car that's more than adequate at a reasonable price even with terrible credit.

At least in my area, most of the vehicles have been 5+ year old Toyotas (almost entirely Camrys, and a Prius or two) that were likely purchased with over 100k miles on them. The nicest thing I was ever in was a new Honda Civic.

That'd be like 10K for another 100K miles? probably more with maintenance. I'm not sure that's a better deal than a $18K civic brand new, if you really planned for driving a few hundred thousand miles, especially when you factor in gas differentials.

My impression is that the cost per mile on new cars is pretty good if you actually drive them for a few hundred thousand miles. The savings on used cars mostly comes in if you don't plan on driving enough to wear a new car out before getting your next car; otherwise transaction costs can be... significant.

A small economy car on a lease is only $100/month, nothing down. The economics are decent.

Leases have significant per mile fees. Your uber driver isn't staying below 15k miles a year.

You would either want a loan or a very high millage lease, both of which cost rather more.

But the interesting part is that I don't see so many of the smallest cars that would work for this, Even though while not that cheap, they are certainly cheaper than larger cars. I wonder why that is?

I ran these numbers when I had access to the data. Varies by region but this number is still much too low. Even if 30c/mile in costs is correct the hourly is still way off

It seems that yet again, "efficiency" in startup-speak just means "offloading cost onto other people".

Lyft rents out cars on a weekly basis. If a driver completes enough rides they don't have to pay a rental fee. Rental includes maintenance and driver only pays for gas.

That is much simpler to calculate. Someone should do the math on that.

Any Uber drivers want to chime in?

This seems rather low. Granted it's been almost two years since I drove for (primarily lyft) and I was making 50k/year for about 70h work a week. And also I gave myself about 6 weeks of vacation over that year and half.

Is that 50k after car depreciation, gas, and maintenance?

After gas and maintenance. Buy Honda.

I'm not calculating depreciation, but that's dumb, since I used the car I had (for about 4 years prior), and continued using it about 2 years after.

$50,000 per year for 70 hour per week works out to $28,571.43 if it were a standard 40-hour work week. Oh, and no benefits and you get to pay for gas and wear-and-tear on your car. So I guess if you're okay spending almost every waking hour working for peanuts and no health insurance, then sure.

Honestly it was more like 60 h a week and it's not so bad because that "includes commute", and also the schedule is really flexible (includes working around logging off for social events, for example). It was some of the least stressful years in my life, if for no other reason than I got to sleep in every day (not waking to an alarm ever).

Would you mind telling us where you drove? I talked to an uber driver in Orlando who said he made a few hundred on a good night..

Sf. It's also very much about strategy.

I'd like to know the average, high and low as well as the median.

I was very curious about this and I did some math and I think it is probably correct. I struggled to see how or why any driver would do this, and figured I must be missing something. I decided to find out for myself with my own car, which is fully electric. I thought if I wasn't paying for fuel that maybe there was some profit here. No, there isn't. When you take out maintenance, depreciation, time, fuel - I'm actually surprised that there is $3.37 left over. The only thing that it offers is cash now for an asset you are currently sitting on. But you are trading that, and your time for the cash now. It is incredibly sad that this is the current state of affairs - it would be wonderful to offer a supply side force to improve the conditions for the drivers.

People seem to be mostly agreeing https://uberpeople.net/threads/3-37-an-hour-seems-legit.2439...

In SF, I'd make $30 to $38 an hour over 40 to 70 hours a week. My friend cleared $2000 week driving 70 hours for Lyft.

My expenses were $400 a week, including car depreciation. I was leasing the car from Uber which is ridiculously expensive unless you do 60+ hours.

If you live with 8 other people and pay $500 month in rent, then you can make good money.

In cities that aren't SF or NYC it isn't worth it. In LA, it's 30% less income than in SF!

I drove for Uber part-time last year in Canada and made less than $3 an hour on paper at tax time.

However, this is highly misleading simply because I was able to deduct fixed "business expenses" that I would have spent anyways to own a car. Insurance, parking, licensing, registration, and finance interest, were all things that I would have spent anyways in the exact same amounts even if I only drove the car for personal use.

In addition, cars are considered to depreciate 30% every year by the CRA (Canadian IRS). This is obviously nonsense; cars depreciate based on kms driven and I did not drive nearly enough kms to reach 30%. So this is not a real expense either, but one I can deduct nonetheless.

So, really, I was subsidizing my expensive car ownership tax-free. The real rate after adjusting for those fake "expenses" was around minimum wage which is fair considering it's a better job than flipping burgers.

I am not sure about Canada but in US you are supposed to deduct expenses for Insurance, parking, licensing, registration as a percent of miles driven for business. So 20k miles driven total with 10k for Uber and 10k for personal means only half of your car expenses is deductible for Uber income.

Yes, it's the same here. Still, since Uber wasn't doubling my insurance (it actually didn't cost anything more), deducting half my insurance etc. for Uber is not really an accurate accounting of the expenses.

I bought the car because I like driving and I like having a car, and I would have bought it anyways.

Oh ok that makes more sense. Yes the standard mileage deduction of 54c/ mile and other deductions makes Uber profitable if done in a right market with an old car. Few years back my deduction made it seem like I was in loss and didn't have to pay any taxes.

Mr. Money Mustache reported $7 per hour earnings after taking off the car costs (https://www.mrmoneymustache.com/2017/11/22/mr-money-mustache...).

The economist behind the study admits this is wrong and has adj the figure to $8.55 from $3.37. Here is the response he posted.

https://twitter.com/StephenZoepf/status/970754550968676352/p...

He also admits to using "donated" labor from students. $0 is even less than $3.37 ;)

https://www.nakedcapitalism.com/2016/11/can-uber-ever-delive...

I have always thought Uber drivers are either mispricing their vehicle cost, or doing some sort of tax optimisation.

If you have a nice car that you only drive a little bit on the weekend, so that most of the cost is in the fixed stuff (age based depreciation (a 5 years old Porsche with 0 mile is still 5 years old), insurance, parking etc), and the tax man let you allocate cost based on miles driven (I am not based in the US), then Uberring where you "try to get business" by driving up and down a highway would be great.

I guess what makes driving different than other low-wage jobs is that it’s a relatively easy job to obtain if you already have the vehicle: you don’t have to do a bunch of interviews, you don’t need a huge amount of ability, you can start making money pretty much immediately. Having a reliable income can be important (as opposed to jobs that limit your hours, etc.).

Of course, it’s obviously a terrible wage. Anecdotally, the drivers I’ve encountered were all doing it for extra side income and not as a main job.

In addition, driving in the comfort of your own car with your own music is genuinely more enjoyable than working in a greasy fast food kitchen.

This doesn't surprise me at all and it's because of hidden costs incurred by the driver, combined with an implicit bidding system that drives down wages.

Hidden costs:

1. Vehicle wear and tear (cars cost you money when you drive them)

2. Vehicle depreciation (cars cost you money even when you aren't driving them)

3. Interest and fees associated with auto loans and leases

4. Insurance premiums

5. Gas

6. Unexpected/unplanned for tax bills

But the feedback you're getting about your income is just the dollar figure that shows up in your account, which is vastly higher than the true amount you could reasonably keep as profit. It makes $10 feel like $100.

Combine that with the implicit bidding system. And by this I mean, market forces will naturally saturate Uber and Lyft with drivers until the price falls low enough that drivers won't accept it. And because of the factors I listed above, that natural price point is practically guaranteed to be well below minimum wage.

The whole setup is just beautifully engineered to trick poor people into thinking this can be a career. I've often thought about which is worse, this or Herbalife. I think Uber and Lyft might impact more people than Herbalife, and generally those people start with less, so I might give it to Uber and Lyft.

Actually, it's also a profession that has one of the highest rates of workplace fatalities, so I'd definitely give the title to Uber/Lyft over Herbalife.

The insurance point deserves further discussion - in many states your normal coverage is voided by driving for profit. So if you get into an accident where they can prove you were working, you aren't going to get anything. I know many people who are driving for Uber and Lyft and have no idea about this

Uber and Lyft both now verify that you have supplemental insurance. It's kind of screwy. If you have a passenger in the car, Uber/Lyft coverage is in place. If you are driving around working but no passenger, it's the driver's rideshare insurance - which is typically a rider on their personal policies. This probably changes regionally, but that's how it works in California.

Which is a good first step... but if I'm injured at a regular job? workers comp will cover my own bills and lost wages while I recover(usually even if it was my own goddamn fault) - Uber drivers don't get that benefit, and they are a lot more likely to be injured on the job than I am.

https://help.uber.com/h/ba03b1db-46f9-4350-9a39-8a98b83f813e

Uber is partnered with a company that provides driver injury insurance for ~4c/mile.

Oh yeah, insurance and financial products in general are just silent murderers of people's finances. Families get wrecked financially for generations to pay for this stuff and they don't even realize it's happening.

And in order to even be eligible to become an Uber or Lyft driver, you first must navigate through that minefield of auto loans and auto leases and insurance companies. And Uber and Lyft is the opportunity that convinces you that it's a good idea to do that (more similarities to Herbalife).

I say all this as someone who uses Uber and Lyft almost every day. The drivers think I'm paying them to drive me somewhere, but what I'm actually doing is paying for them to take on the liabilities/debt/depreciation associated with owning a vehicle. That's where the value is for me, it has nothing to do with them driving.

Both Uber and Lyft have insurance policies that cover drivers and passengers during rides, and in most cases the maximum coverage per accident is $1 million.

https://www.uber.com/drive/insurance/

https://help.lyft.com/hc/en-us/articles/115013080548-Insuran...

However, the insurance provided by Uber and Lyft only cover when you have a passenger in the car -- they don't cover you when you are driving to pick up the next person. And your own insurance also doesn't cover you during that period, unless you buy a separate commercial rider.

that's not true. it covers the driver while the app is on.

https://www.uber.com/drive/insurance/

> While you’re online with Uber before you accept a request, you are covered by our insurance policy for your liability to a third party if you are in an accident when you’re at fault

Only when you're at fault?

If the other party is at fault, their insurance should cover their liability for your damages.

... if they have valid insurance and if they don't flee the scene.

Both of these statements are false, at least here in Canada. My insurance knows exactly what I'm doing and I'm covered at all times [0]

[0] https://www.intact.ca/on/en/personal-insurance/vehicle/car/u...

When I last renewed my insurance it offered me coverage for driving for rideshare for an extra $50 per 6 months (I think - I've never driven Uber/Lyft, so I didn't look too closely).

If I'm remembering it right that sounds like a very reasonable price

1 million is a laughable low coverage. Get into a single accident where someone has to get emergency surgery, a few months in the hospital, and then needs physical therapy to walk again. One million is gone faster than you can imagine.

1 million is far far higher than what most people carry. It's plenty.

Interesting. In Germany the lowest legally possible coverage is 7.5 million € for damages to a person plus 1.22 million for other damages, but 50 to 100 million is the general coverage. Just to give some perspective on how expensive accidents can be.

Is this for commercial or personal drivers?

Personal drivers. Prices might be higher than in the US but it's hard to give an exact price or even a range because it varies a lot by vehicle type. I'm paying about 600€/year for a small and older VW. But a bigger car doesn't necessarily need to be more expensive because the parts to repair it could be cheaper or it's less likely to get into expensive accidents due to break assistance.

I'm also covered for accidental damages caused by me outside of my car for up to 100 million € and that costs me only about 70€/year.

I’m paying about $1700/year for $1m coverage for two newer sedans with a combined value of about $40k. You can’t buy more coverage than that in the US without going to an insurance agent. It’s available but as a specialty product aimed at wealthy people. Most car insurance websites won’t quote coverage that exceeds $300k or $500k. The legal minimum, which is what many (most?) people have is like $60k.

I’m sure some of this is due to the differences in our healthcare and legal systems. Ironically, it seems intuitive that Americans should have higher insurance limits than Germans, not the other way around.

This is putting some stuff Uber did in Germany into perspective.

When Uber Pop launched in Germany insurance companies were quick to publicly state that no driver using Uber is insured under their personal policies and they needed to opt into commercial policies that are multiple times more expensive.

Then Uber stepped forward and put out a big anouncemnt that every driver is insured for up to 1 million €. Everybody was like "yeah, okay, that's not nearly enough to be allowed to drive here in Germany". Nobody understood why Uber would make such a dumb statement. Now that you explained how it's handled in the US, I'm not surprised anymore.

Have a look here: https://www.thebalance.com/understanding-minimum-car-insuran...

People are recommended to have more than the minimum if they own a home, or otherwise have a lot of assets to protect.

Commercial requirements are much higher.

It works different in the states because the person or property being injured also has insurance, which will cover them. Insurance covers you not the person or property being injured.

So if you smash a building with your car, the property owner will collect from their insurance. That insurance company will then sue you, and your insurance will cover you. If you don't have enough insurance, they'll take what they can get, and if you don't have any property or money, they'll give up after that.

That sounds insane, even with American medical prices. How much are insurance premiums in Germany?

I just don't see how anyone could cause that much damage with their vehicle.

https://news.ycombinator.com/item?id=16499582

It's pretty easy to do so much damage. Imagine turning left without looking and an oncoming truck tries to avoid a collision and drives into a store front. Property damages will be very high and the injured people inside the store will need medical attention, too.

Also sounds like the truck's fault.

I caused something similar and accepted the accident as my fault.

I back-exited a parking space and turned left immediately after, while the truck tried to avoid me by going in the incoming lane; if he just hit the breaks without swerving I would most like have been killed.

That’s what Steve Wynn said about his elbow!

When my girlfriend traded in her car, they asked if it was ever used as a taxi/uber/lyft.

To add in to that, Uber itself seems to offer a lot of "helpful" services for their drivers, such as the cellphone they provide that only runs the driver app and nothing else, that uber charges $10 a week to lose.

Yeah, nobody does this.

You just install the driver app on your personal phone.

The difference may be that there is no end goal with Herbalife.

With Uber and Lyft, once the self driving cars start working it will truly displace all the drivers. So perhaps they are just pawns in this endgame.

I drove for a few days as an experiment. What struck me was how low skilled work it is. No judgement. Just, it felt like having a really easy job.

And a little humiliating. I’m old, and with drunk kids being a little condecending, plus seemed like my car smelled like booze for days!

But, how low it pays and it shocks me there are ALOT of people with free time willing to work for sub minimum wage.

Have a friend who did it for a couple of weeks and said pretty much the same thing. It's literally a race to the bottom, heard stories about drivers who come into the big cities and sleep in their cars for this wage. Uber & co calling drivers entrepreneurs makes me sick.

I had a driver once mention a promotion uber was running for their drivers if you hit "X rides' in a certain time period you'd receive a $Y cash bonus - the catch was the system made it extremely difficult but not impossible to achieve the goal through subtle gamification techniques.

Big picture tech/gamification has reached a point where oversight/legislation of some sort is long overdue. No restrictions + profit motive with our current understanding of human psychology and dopamine triggers is a recipe for a bad time.

Yep I have heard about several similar promotions in the LA area from drivers.

A lot of drivers tell me often that as they close to hitting their number they get rides that are far away from where they are.

They then have to drive across town to pick the rider up and then drop the rider off at their destination ( which can be 15min to hours away).

The net effect is drivers rush during these promitions for quotas they usually don't hit.

Would not be surprised if Uber's algorithm started placing rides for drivers far away to avoid paying out promotions.

This sounds like the basis for a class action lawsuit that eventually settles for a $15 gas card for the affected drivers and $2m in fees for the plaintiffs' lawyers.

I drove a cab for beer money back in college, and a year or so ago, I had an interesting discussion with a cab medallion owner, after some typical uber driver cut us off. He thought it was a suckers' game where it looked like you were making money - until you had your first breakdown and you had no money and no income. He was pretty confident the average cab driver couldn't plan for this, and the whole thing would collapse like a house of cards. For him, breakdowns weren't an issue because he still had the old Crown Victoria.

He also said "they're all from turnip town" which I thought was hilarious.

So, Googling "they're all from turnip town" led me to this:

https://www.youtube.com/watch?v=FuKvUf7cr0s

And I still don't know what it means to be from turnip town.

That video has 300 views and is one of the weirdest things I've ever seen.

Ha, thanks for that.

The implication was the drivers live in cheaper rural areas and come into the city on weekends to make money. Thus they don't know where they're going and are dependent on internet maps.

Back when I drove a cab, there actually was some skill to it - you had to keep all the streets and bars in your head and know the best routes.

My mom is fantastically bad with money. When I was ten my dad was murdered.

Our survivor benefits in 1987 were ~2400. Our three bedroom apartment in San Diego was 700 a month. My mom managed to make us broke in 2 weeks and we were getting food boxes at the end of the month. She just went fucking bonkers whenever she had cash like it was our last day on earth. Tons of fast food, buying toilet paper at 7/11 instead of bulk at a large store.

30 years later she is even worse. She considers payday loans and her credit card unused balances income. It is fucking absurd. A few years ago I paid off all her stuff and said not to do it again. This ended exactly how you think it would.

I took the long way around to explain that people like my mom are so short-sighted that she will just see the balance and never consider the cost that was occurred for that balance.

Subsidized public transportation is nearly essentially for a world-class city, but it anchors the value of a ride in people's minds, which is brutal for the private transportation market. My own labor is valued at a lot more than $12 per hour, but I don't even blink at getting in the car for 20 minutes for $4 - if anything, Lyft and Uber start to look expensive in comparison to the local metro.

Of course Lyft & Uber are more expensive than the local metro. They also pick you up & drop you off exactly where you need to be & don't make any additional stops. The anchoring for cost is to Taxi services not metro. Moreover, Lyft & Uber let you plan pretty precisely how much time you'll need even for the carpooling option in my experience; I've been in more buses/metros that broke down in the middle of my trip & am currently at 0 such issues for Lyft/Uber (I use it a fair amount for work).

I agree that market forces push down the prices below minimum wage. I don't think that itself is necessarily a bad thing. For one this labor is relies on a skill that most people (in US at least) already can do, so is almost unskilled labor. And unemployed people who can't find a minimum-wage job (which may be limited especially in places that set high minimum wages) are actually able to earn something. Plus these low salaries do help lower transportation costs for Uber/Lyft users.

But what I don't like is how Uber/Lyft market themselves into tricking poor people that this can be a worthwhile career, especially when all these hidden costs are not clearly communicated to drivers.

I think the solution relies in potential drivers becoming aware about these hidden costs.

> Drivers earn a median of 59 cents per mile while incurring a median cost of 30 cents per mile, the report said, adding that for nearly a third of drivers, the costs are ultimately higher than the revenue.

> The paper reported the average driver profit to be $661 per month.

The posted $3.37 number is before taxes!

This headline is a confusing a statement based on what the paper says. The paper[1] claims "Results show that per hour worked, median profit from driving is $3.37/hour before taxes". The profit has subtracted from it amortized losses associated with vehicle wear and tear/deprecation. This makes sense knowing the nature of the business, but if a Domino's delivery driver, who similarly uses his own car for the job, says to you that is hourly wage is $9, would you assume that he was subtracting out vehicle deprecation?

[1] PDF: http://ceepr.mit.edu/files/papers/2018-005-Brief.pdf

The median driver, huh?

I'd guess 90% of the Uber/Lyft miles driven are done by 5% of the drivers.

The median driver is probably someone halfassing it like I did. Trying it occasionally for an hour or two, without much of a plan. Seeing what it's like.

Part-time drivers are also likely to already own their own car so factoring in 100% of vehicle depreciation is disingenuous. It only makes sense to father most if not all of vehicle depreciation for those drivers that are working full time.

But hey, they are free to choose their own times and rides. You surely cannot put a price on Freedom. You get screwed a bit, well a lot but it is all for the greater good.

Statistics is tricky.

Remember that the median driver drives very few rides.

The median ride is driven by someone who does it more or less for a living, and who makes a lot more money than this.

Also remember that this single fact was cherry picked from the report to make a good headline, not to give the best understanding of the situation as w hole.

Based on the numbers we have, the average earnings per mile is close to $0.545, but the medium profit of $3.37 seems quite off.

If people truly were making $3.37/hour full-time I think you would see very few drivers; it's grossly misleading to assume so many people aren't capable of managing finances. It looks like the full paper itself is currently embargoed so it's hard to examine the methodology. However, just looking at the math (assuming I did it right) it seems the conclusion are misleading (the numbers themselves indicate they probably just sampled all ride-share drivers throughout the US rather than full-time ones):

revenue: $0.59/mile cost: $0.3/mile monthly profit: $661 Average fuel consumption is ~26.4 mpg so let's round to 25mpg Average fuel cost: $2.5/gallon Average number of working days/month: 21.75 Average number of weekend days/month: 8.65

0.59 * x - 0.3 * x = 661 0.29 * x = 661

x = 2279 miles

2279 miles/22 days = 103 miles. 2279 miles/8.65 days = 263 miles 2279 miles * 0.59 = $1344/month in income or $16128/year. 2279 miles * 0.3 = $683/month in expenses ($273/month in insurance, maintenance & repairs, $273/month in fuel, & $136/month in depreciation). . Average fuel price is $2.5.

2279 miles/25mpg = ~91 gallons. 91 gallons * 2.5 = 227/month in fuel.

Where it gets tricky is we don't have data on the average speed of an Uber driver & whether the 103 miles includes driving around waiting for rides. Let's assume a conservative average speed of 40mph.

103 miles/day / 40 mph = 2.5 hours/working day/month. 263 miles/day / 40 mph = 6.575 hours/weekend/month.

The faster you drive the less you work so if my average speed of 40mph is too conservative, then the average driver drives even less. It seems like this builds an average profile of a driver is one who picks up a rider or 2 on their way to/from their main job & then picks up some extra cash driving a bit on the weekend. The average driver probably doesn't consider Uber as their sole source of income but rather as extra income their making when they otherwise wouldn't be doing anything. Now of course that's probably less money per hour than they could pick up from picking up additional hours somewhere or even something like Task Rabbit. However the average Uber driver probably sees it as more reliable in terms of total revenue than Task Rabbit, it requires minimal effort, & it has extreme time flexibility that a second job wouldn't (just turn on the app whenever you want to make money).

Anecdotally the full time drivers I've asked in LA & the Bay Area told me they're pulling in 60-120k depending on how many hours they put in & the area they drive in. I didn't know this but apparently Uber & Lyft offer a lot of incentive programs that only the most active drivers can t take advantage of that significantly bumps your income (trips/day, trips/week, miles driven, etc). If you're not doing it full time then you're not getting these bonuses which is going to further impact your $/mile (of course I suspect the fares & costs are higher in these areas too). Since 40% of your cost is fuel consumption, drivers doing this full-time are going to prefer fuel-efficient, cheap cars than the average driver doing this on the side. This is obviously a more complete picture than the misleading news reporting might indicate.

*EDIT: As another comment pointed out, the cost numbers are artificially inflated. They're attributing to the entire cost of insurance to driving whereas from the model above the average driver already has a car. Thus they need to actually use the fractional increase in the more expensive insurance they need for the ride share vs what they would get otherwise. I suspect the same problem applies for depreciation where they're not using the fractional increase of depreciation cost due to driving more but just the overall vehicle depreciation which was going to happen anyway. Even the full time drivers probably would have bought vehicles anyway so the depreciation & insurance cost isn't reflective of that anyway.

TLDR: The main problem of the "study" can be summed up as follows: they take income from those who do it occasionally & subtract the costs of the ones who do it full time. Given the threat ride sharing poses to personal car ownership, it's not surprising such a misleading study is sponsored by people who would be impacted by reduced car ownership.

This article is not informative. It leans on an MIT Center for Energy and Environmental Policy Research study, with no publicly described methodology and a hidden "full" report. Its a waste of time for everyone imo.

This type of "science" journalism is everything that is wrong with the intersection of media and research. Funding aside, the researchers are isolating a non-transparent, non-reproducible data finding, out of context, and feeding it to the press. On the other hand, the press is reporting this finding, and weighting believability upon credential, instead of reasoning. The head researcher of the article even lists his key credentials as follows: "..His work has been covered in numerous popular press articles..". Good, informative, transparent research? who cares, credentials are accumulating.

The output is statistical nonsense. Its a complete waste of time for anyone looking for real information, because the findings are not contextualized in any meaningful way. The article does not come close to offering apples-apples comparisons of other surveys that would give the reader a working understanding of the economic dynamic it talks about.

I'm so confident that the findings are meaningless because I used to own several businesses where I hired 100s of professional drivers. It would be easy to manufacture results like this $3.37 "median" finding. Many drivers in any given year start and quit with no idea of what the job entails or the economics, yes, even when you tell them explicitly up front. I've seen first-time drivers that want to use vehicles that get 12 mpg. Some drivers just shouldn't be drivers; they can't navigate, avoid traffic, or follow basic instructions. Many drivers aren't ready to treat the situation as a business with a profit and cost center - it's not trivial to quantify costs, and many people don't think that way at all. Also, some new drivers that might make good drivers, take some time to learn. They can take a while to work into a rotation and earn more lucrative rides. Also, many drivers take time to understand the principle that some times of day are busier and they will make more money during that time.

Context matters, a lot.

Also, I frequently ask Lyft / Uber drivers what they make. In many different cities. Its all about the same as I used to see in my businesses. It's not magic, the drivers who stick with it understand the system and make anywhere from nominally above minimum wage to maybe 3X minimum wage for the most capable and most opportunistic drivers.

The basic economics of professional contract drivers has been about the same for dozens of years. I'd speculate what might have changed, if anything, is that Lyft / Uber have normalized driving as a profession, and have strong brands that attract more people. Maybe that results in higher churn rates than the industry has ever seen. That would actually be really interesting if a university researched that trend and explained it through quality scientific journalism.

I feel journalists who are serious about presenting research findings will provide: 1) a complete and transparent understanding of the methodology of the findings, 2) impartial reviews from believable research peers, 3) a concrete and thorough description of the context of the finding. This seems like a minimum journalistic standard. It shouldn't be good enough to point to a dude associated with MIT and say "this dude says this thing so <press narrative>". If journalists rely upon credential, without reasoning, to assert truth, its just manipulation hiding behind assumed pedigree.

I've taken many Lyft and Uber trips in SF recently. It's amazing how many have new, high end cars.

One driver was a PYT and recent immigrant driving a luxury Mercedes C class. Wasn't hers. Sugar daddy's? Something else?

Doesn't make sense. I feel there's something else going on.

Many will have a story about being hired to transfer a bag or a box. Drugs? Money? Guns? Even then there couldn't be enough business to make a good profit.

I haven't seen many. The few I have been in have been people just doing it for "fun" if they were bored or to keep themselves out of trouble. They never seemed to be the people coming in from Stockton or Reno and needed the money.

I find articles like this dubious when they state an outlandish claim, even if supported by a study, and make 0 effort to explain or justify the results. Instead appealing to the implied authority of said study, that the reader is apparently expected to unquestioningly believe.

That number is obviously going to be controversial. How was it calculated? What assumptions were made? In their own article every single other source they reference provided higher numbers. How much higher? What were the exact reasons for the discrepancy? They did state that other studies showed higher earnings because "there are numerous ways to report income and to calculate costs and time and miles spent on the job." Why did this study report lower income, more miles, or higher costs?

I wish the job of journalism was still to inform people, and not just to get people to click on things.

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