Earning money just by hopping into your car is a dream that Uber has helped millions of drivers achieve. However, when you’re considering a driving gig as a path to meet your financial goals, you probably want to know exactly what you can expect before you start filling out an Uber application. So exactly how much do Uber drivers make?
New driver sign-up bonuses and a flexible schedule can be enticing, but with frequent talk about low driver pay, it can be hard to determine if an Uber gig is really worth what it advertises. After all, making sure your earnings will meet your needs in the long run is a definite must, whether you’re a part-time or full-time driver.
Keep reading to get our complete guide to how much Uber drivers make so you can decide whether to sign up or look elsewhere.
- Uber Driver Earnings Trends in 2019 and 2020
- Factors That Influence Earnings
- How Much Do Uber Drivers Make Per Hour?
- How Much Do Uber Drivers Make Per Day?
- How Much Do Uber Drivers Make Per Week?
- How Much Do Uber Drivers Make Per Month?
- How Much Do Uber Drivers Make Per Year?
- Frequently Asked Questions
Uber Driver Earnings Trends in 2019 and 2020
Before we break down the specifics of how much Uber drivers make, we’ll consider how earning levels have changed in the past year.
At the time of this writing, COVID-19 is currently decimating driver earnings. Our team just completed a survey of 175 rideshare drivers, and found that rideshare income is down by over 80% since coronavirus lockdowns began last month. As a result, many drivers are struggling to make ends meet and are at risk of not being able to cover staple expenses like car and insurance payments.
Aside from the pandemic-related income changes, before the lockdowns went into effect, average Uber driver earnings across all platforms actually increased 31.4% from our 2018 survey.
It is evident that there are some big changes happening in a handful of major U.S. cities. Namely, Uber is responding to criticism about its classification of drivers as independent contractors.
Uber drivers have always been independent contractors in the United States. This allows you to have full control over your schedule and essentially be your own boss. At the same time, this has enabled the ridesharing company to keep driver pay fairly low while also leaving drivers responsible for all of their own rideshare expenses.
Car payments, as well as vehicle and health insurance costs, aren’t covered either. After paying for their own gas, maintenance, insurance, and more — not to mention paying self-employment taxes on top of income taxes — many drivers are left with unimpressive annual earnings. We’ll dive into more on that in the section below.
In this past year, the precedent for change has been set. New York City became the first U.S. city to set a minimum wage for rideshare drivers, boosting driver pay by over $5 per hour above the national average.
As a result of these changes, our survey found that New York City has become the best-paying city for Uber drivers, with drivers earning an average of $26.24 per hour. Some California drivers are also getting more control over their own rates, allowing for higher earnings for strategic drivers.
If this trend continues, it’s quite possible that both your earnings and independence will continue to increase in 2020 and beyond. Keep this in mind as you learn more about what Uber drivers are currently making below.
How Much Do Uber Drivers Get Paid?
Interestingly enough, I found that to truly figure out how much Uber drivers get paid, it’s important to take into account two main points that oftentimes get overlooked by most drivers:
- How much does the Uber ride cost?
- How much are Uber driver expenses?
The different factors that affect these numbers widely vary by city, but the general idea stays the same no matter where you drive. Let’s dig a bit deeper.
1. How much does an Uber ride cost?
Before we go any further we need to know how much Uber pays drivers for each ride they give.
Riders get charged via a simple formula: Fare = Time + Distance.
For every minute a passenger is in the Uber, they get charged (time). On top of that, every mile you travel also gets charged (distance).
Okay, I told a small lie there. The total fare has a few more variables. They are:
- Base Fare
- Rider Fee / Booking Fee
- Surge Pricing
The Base Fare is fixed per trip. The Rider Fee or Booking Fee is also fixed and is set to cover things like driver background checks and other driver-related expenses Uber incurs on booking.
These fees vary from city to city and also on what Uber the passenger requests.
Finally, if driver supply is low and passenger requests are high, surge pricing might be enabled to encourage more drivers to come to the road, costing the riders more. This is a multiplier and its value depends on the gap between driver supply and passenger demand. The wider the gap, the higher the multiplier.
So how riders get charged is based on a formula that has two parts. First, we work out the subtotal.
Subtotal = Base Fare + Time + Distance
Then we apply the surge pricing, if any, to the subtotal. If passenger demand and rider supply are balanced then this number is just 1.0. Then add the booking fee to get the fare the passenger pays.
Passenger Fare = (Subtotal x Surge Pricing) + Booking Fee
However, this is not the payout the Uber Driver gets. Let’s illustrate with an example.
For this scenario, we’ll be using the example of a rider in Chicago traveling via UberX from The Sears Tower to the Navy Pier. The ride is 2.3 miles and takes approximately 15 minutes. In Chicago, the base fare is $1.70, the cost per minute is $0.20 and the cost per mile is $0.90, in addition to a booking fee of $1.20.
Passenger fare: 1.70 + (0.20 x 15) + (0.90 x 2.3) + 1.20 = approx $8. (However, our Uber Fare Estimator estimates this being between $12–$14)
Let’s take an optimistic outlook and say the final passenger fare will be $14.
Not bad, right?
Well, the driver doesn’t actually get to keep all that money. Uber takes a 20 percent cut of the final fare.
It’s also worth pointing out that even if the rider is on a new user promotional credit, the driver still gets paid like normal.
$14 – $1.20 Booking Fee – ($12.8 x 0.80) = $10.24
So for the 15-minute ride, the driver would only earn $10.24. That’s not net, that’s their total payout for the ride before expenses, which brings us to our next point.
2. How much are Uber driver expenses?
After a driver has given an Uber ride, they must calculate the hidden cost of the ride. Often drivers overlook these expenses, which then comes back to bite them later down the road.
These expenses include:
- Insurance: This includes personal insurance and a rideshare or commercial insurance policy.
- Car/lease payments: The amounts a driver pays to drive their vehicle. Drivers either own their own vehicles or lease one from Uber or a third-party provider.
- Tolls, license, permit fees: Drivers pay for all of these fees. Passengers pay an added surcharge when drivers must incur toll fees.
- Gas: Since drivers are considered independent contractors, they must pay for their own gas, and are not reimbursed.
- Vehicle maintenance: Drivers are responsible for their own vehicle maintenance and upkeep. They will be reimbursed if a rider damages their vehicle, however.
These types of expenses, again, can vary widely based on a bunch of different factors, including what type of car you drive, what city you drive in, age, and driving record.
Given that fact, we’ll summarize these expenses and speak in broad generalities.
It’s a general rule of thumb for the rideshare industry to budget roughly 20 percent of the total ride fare amount for ride-related expenses.
In our example, that would mean: $10.24 x 0.8 = $8.19
At that rate – hypothetically speaking, after factoring in pick-up, drop-off, and dead time – the UberX driver could estimate to make somewhere in the neighborhood of $15–$20 an hour if they were to get two similar rides each hour they drove.
Bottom line: Uber drivers have a lot of expenses, that cut into their earnings, and drastically affect how much they pocket when it’s all said and done.
How Much Do Uber Drivers Make Per Hour?
While being an Uber driver can be great, figures on hourly income can be elusive. I personally drive in the Midwest, and I’ve made anywhere from $5 an hour during times of high driver supply and passenger demand, to more than $50 an hour during a glacial snowstorm when almost all other drivers were hibernating like bears in their beds.
So in 2019, to clear up the confusion, our team created a survey that measured driver earnings and satisfaction to finally get some answers.
Over 2,600 active drivers took our survey, which allowed us to analyze $1,027,585 in driver earnings that represent 62,583 paid driver hours.
After getting the data, we thoroughly analyzed it and compiled our final results into Ridester’s 2018 Independent Driver Earnings Survey.
We found that in late 2018, the average UberX driver made $13.70 per hour before tips, or $14.73 after tips are calculated in. UberXL and Select drivers earned just under $15 per hour before tips, while Uber Black driver wages averaged out at an impressive $24.87 per hour before tips.
2018 survey findings:
After notable news outlets like The New York Times, Forbes, CNBC, and Vice, (just to name a few) quoted our 2018 survey data, we decided to re-run the survey to see how much of a different a year would make on Uber driver pay. Shockingly, we were blown away by the results.
In our 2020 RIDES Survey, we found that Uber drivers across all service levels experienced a 31.4% increase in earnings for a total of $19.36 per hour when base rate, tips, and Uber bonuses were factored in. UberX drivers experienced the highest increase of all service levels, seeing a bump in earnings of $14.73 in 2018 to $18.97 in 2020.
2020 survey findings:
Other notable findings from the 2020 RIDES Survey:
- The average tip for UberX drivers increased 7% between 2018 and 2020
- 46.4% of drivers drive for less than a year
- It seems that Uber is paying drivers more bonuses in 2020, which is key to the increase from 2018
While Uber once advertised that drivers could make as much as $25 per hour, it’s clear that this attractive payment isn’t what the majority of drivers — UberX drivers — are experiencing each day. These higher earnings are only easy if you own or invest in commercial insurance and a luxury vehicle, though doing so can also lead to greater maintenance costs over time.
Still, that’s not to say that $25 per hour isn’t possible for the average driver. Uber drivers’ hourly wages continue to be heavily influenced by a number of factors, including:
- Location: Drivers in Honolulu and Seattle may often see earnings around the $25 per hour mark, while drivers in places like Tulsa, Oklahoma, and Houston, Texas may not even reach $10 per hour.
- Surge pricing: During busy times (often including rush hours, storms, and big events), demand will rise higher than supply, allowing surge pricing to kick in. This multiplies fares, leading to big per-hour earnings differences.
- Tips: Drivers earn 100% of tips, so getting even one extra dollar on a tip per hour can lead to big hourly earnings differences.
Once in a while, you may even be sent Uber driver promotions that help you earn extra money for driving in a certain location or completing a set amount of rides. With this in mind, you can see how no Uber driver is limited to the national average $19.36per hour wage.
How Much Do Uber Drivers Make Per Day?
Taking the average hourly earnings described in the previous section, we can calculate that the average Uber driver can make approximately $154 in a single day. This is assuming that rideshare driving is your full-time job and you drive a full eight-hour day. If you are in New York, you’ll of course make more, earning $209.92 per day at an hourly rate of $26.24 per hour.
However, it is admittedly hard to provide a completely accurate daily earnings estimate, as daily earnings see huge fluctuations. Part-time drivers will naturally earn less than full-time drivers, and even full-time drivers (those who drive 40 hours per week) don’t always follow consistent schedules. They may drive a couple hours in one day, but drive 10 hours the next.
The best way to estimate your expected earnings is by considering what your own driving habits will look like on any given day.
How Much Do Uber Drivers Make Per Week?
Full-time UberX drivers can expect to earn nearly $590 per week after tips when working 40 hours in a week. Beyond the aforementioned factors — location, surge, and tips — weekly earnings can also be heavily impacted by the amount of trip requests you receive throughout a seven-day period.
Some weeks, especially during the holiday season, you may notice your app lighting up with back-to-back requests as soon as you log on. On other weeks, you may be frequently idling while waiting for your next pick-up requests.
When considering the $590 per week earnings, remember that this average is calculated before your weekly gas expenses or your taxes are taken into account.
How Much Do Uber Drivers Make Per Month?
If we calculate one month as a four-week period of time, an average Uber driver makes approximately $2,360 per month when working full-time. Again, this amount can fluctuate based on where you’re located, what service you’re providing, and more, but you can expect close to $2,400 per month across the nation.
Of course, it’s important to not let it slip your mind that you have major monthly expenses to take care of on top of your gas expenses. This will typically include the cost of an oil change and car insurance payments.
How Much Do Uber Drivers Make Per Year?
According to Glassdoor, an average Uber driver will make approximately $33,000 per year, including tips and promotions. This pay may be meager in a major metropolitan area or for drivers with families to support, but it’s decent for single drivers in many U.S. cities. If you focus on strategies like increasing your tips with exceptional service (and even small amenities), you may start making money even faster.
Again, it’s important to consider the costs of being an independent contractor beyond the expenses of ridesharing and self-employment taxes. As an Uber driver, you’re responsible for your own “benefits,” like vacation days and health insurance, which means that $33,000 isn’t as high as it may sound for a standard full-time employee. Still, considering the amount of flexibility you get and the low barrier of entry to the job, becoming a full-time Uber driver may be perfectly worth it for you.
If it isn’t, driving with Uber can still be an excellent side hustle that can help you pay for anything from your vehicle insurance to your student loans.
Frequently Asked Questions
The average Uber driver may not be making thousands per week, but that’s not to say that earning through ridesharing doesn’t have its perks. Here are our answers to three frequently asked questions to give you more insight into driving with Uber:
1. How do Uber driver earnings compare to Lyft driver earnings?
Uber drivers are known to make slightly less than Lyft drivers. We’ve found that a standard Lyft driver makes about $17.50 per hour, which is nearly $3 more than what Uber drivers make. Of course, your average Lyft wage (just like your average Uber wage) will vary based on location, how much you take advantage of promotions on Lyft, and how much you earn in tips.
2. How much money should I budget for expenses as an Uber driver?
It’s hard to estimate how many business expenses you’ll accrue as an Uber driver, as this can vary based on your car model, local gas prices, and the amount of repairs your car needs in a given year.
However, it’s estimated that drivers spend as much as $4.87 per hour on gas and maintenance after tax deductions are considered. Make sure to save your receipts for job-related expenses for tax season, so you successfully get your deductions and don’t spend more than this estimate.
Still, you can drastically reduce your costs over time by choosing a car with great gas mileage and sticking with a car maintenance schedule that prevents expensive repair needs.
3. How much commission does Uber take?
Uber has advertised that they take 25% commission from each ride, but we’ve found that Uber fees can be significantly higher. In some locations, it may even take over 40% of a total ride cost. Luckily, Uber commission is already taken into account when calculating how much Uber drivers make.
Stay on Top of Your Earnings
Driving with Uber isn’t the highest paying job around, but it does grant you total control over your own hours. If you drive wisely, taking advantage of surge pricing and promotions, you can exceed $20 per hour with a standard UberX car. It’s a great side hustle or full-time gig for anyone who loves being behind the wheel and starting conversations, especially if you put some effort into your work.
If you’re ready to enter the gig economy as a rideshare driver, sign up at our invite link or with the code “prgey” to claim your local driver bonus today.