Uber/Lyft Drivers Now Earning Less than $5 an Hour
Last week, between July 15-17, 2020, we interviewed a little over 100 drivers around the country to get a sense of how Uber/Lyft rideshare drivers are faring now that cities are beginning to re-open after the COVID-19 pandemic.
Our last survey was in late March just after most of the nation locked down for COVID-19 and the results were dismal. Ninety percent of drivers reported to us that they had lost 80% or more of their income. In other words, they were flat out of business. All the sources of business for rideshare drivers, such as the morning and afternoon work commutes, restaurants and bars in the evenings and airports had all shut down completely across the country.
- The pandemic is crushing rideshare drivers economically
- Many drivers earning less than $5 an hour now, after expenses
- A third of drivers can’t make their next car payment
- More than 25% of drivers don’t routinely wear face masks
- Drivers making more on unemployment than they did driving in pre-pandemic days
In this survey, conducted the third week in July 2020, we looked at how things have changed for drivers in the last few months. The bottom line is that things have improved very slightly, but not nearly enough for drivers to earn a living wage.
62% of Drivers are Making “A Lot Less” Now
Three quarters of Uber and Lyft drivers told us they were making less than before. Of those interviewed, 62% said they were making “a lot less” and 11.4% told us they were making “somewhat less”.
10.1% of drivers told us they were making more than they did before the pandemic started. We saw that repeated throughout our interviews, that approximately this same percentage of drivers repeatedly told us they were making more. We’ll get to why that is in a minute.
To put that into perspective, in our March survey, 92.1% of drivers told us they were making “a lot less”. So this is definitely an improvement – but it still leaves a three-quarters majority of drivers making less than they were before.
Also in March, only 1.2% of drivers told us they were making “about the same”. Today that number stands at 16.5%.
|March 2020||July 2020|
|Drivers making a lot less||92.1%||62%|
|Drivers making somewhat less||6.1%||11.4%|
|Drivers making about the same||1.2%||16.5%|
|Drivers making more||0.6%||10.1%|
80% of Drivers are Earning Less Than Half What They Used to Earn
For drivers who said they were making less, we asked them how much less. 41.4% of drivers told us today that they are basically not working anymore – so they are therefore making 100% less.
In our late-March survey, about 58% told us they were basically not working and making nothing. So, this represents some improvement but not really a huge improvement. And certainly compared to what drivers earned last year, this shows that most drivers are well below that level and nowhere close to reaching it anytime soon.
In total, 79.3% of drivers today are earning 50% or less than they earned in pre-pandemic days. In March, that was 89.5% of drivers, so only about an 11% improvement here. The vast majority of drivers are still earning far less than half what they earned just five months ago.
Drivers are Lucky to Net $5 an Hour Now
In our March survey, no drivers told us they were making more, which makes sense considering that everything was shut down. But in this July survey about 10% of drivers did say they’re making more now than before the pandemic began.
Out of the 10% of drivers who told us they were actually making more, 12.5% said they’re making twice as much. This represents about 1.26% of all drivers, so it’s pretty negligible. When we talked to the drivers who said they’re making more, it seems that they just happened to luck out by driving in areas where business is starting to come back, but most drivers are scared to drive because they don’t want to become infected with the virus. Essentially, they’ve found themselves in areas with a supply and demand imbalance. And as we know from economics, that won’t last long.
In our 2020 RIDES driver earnings survey, we found that drivers had earned on average, $18.97 an hour over the last year. That’s before car expenses.
Based on figures from Uber’s SEC filings, most drivers have expenses of anywhere from $8-10 per hour. That means that drivers today are earning just $5-$6 an hour after driving expenses. Although many drivers will tell you that they have many hours now when they don’t earn anything at all because they’re simply not getting any passenger requests for long periods of time.
Nearly a Third of Drivers Say They’re Having Trouble Making Their Car Payments
31.6% of drivers told us that after 3-4 months of what amounts to no work, or not nearly enough work, they’re having trouble making their car payments and paying for other basic car expenses.
This of course, would mean they’re also having trouble paying for routine maintenance and upkeep of their vehicles and this could cause safety issues in the near future. Are drivers letting their brake pads wear a little too thin before getting them replaced? It costs several hundred dollars to replace brake pads and if they’re having trouble meeting all their obligations, they may just decide to pay the insurance and car payment and let the brake pads go another month. Same with tires. Will worn tires with thin treads eventually cause an increase in accidents? It certainly seems likely.
A Fifth of Drivers Don’t Wear Masks
We asked drivers if they wear masks when they have passengers in their cars, as they are required to by both Uber and Lyft. Only 80.8% said they did, which means 19.2% don’t. Another 5.5% told us they wear them only sometimes and 1.4% said they never wear them. That’s more than a quarter (26.1%) of all drivers who do not wear masks at all times.
Passengers Don’t Always Wear Masks Either
30% of drivers told us that only half or fewer of their passengers wear masks. 54.3% of drivers said “most” of their passengers wear masks. (The 15.7% who chose other, told us they’re not driving right now).
76% of Drivers Who are Driving Less are Doing So Because of Danger from Virus
75.7% of the drivers who told us they are driving less now than before, told us that they were doing so because they wanted to protect their health. Nearly half told us it’s because the business is so dead that it’s not worth their time right no. 10.8% told us that they’re making more on unemployment.
Drivers are Putting in Fewer Hours on the Road
We were curious if drivers were driving more or less or about the same as before – so we asked. Half told us they were driving less, which you would expect in times like these. Since this was a relatively small sampling of drivers we were able to talk to many of them and ask more in-depth questions.
Fear of Exposure to the Virus
There were those drivers who simply didn’t want to get out there because of the risk of being exposed to and catching the coronavirus. And indeed, their fears are warranted in light of the fact that many drivers have died from it. In fact, the very first known person in Long Island, NY to become infected with COVID-19 was an Uber driver who is believed to have caught it from an overseas passenger he picked up at JFK airport. He was stuck for at least an hour in his car with this passenger as they drove to the outer suburbs of New York.
Drivers know that the environment of a car is about the most risky place you can be today with a stranger when it comes to COVID-19. So many are understandably reluctant to drive.
Discouraged: Not Enough Money to Make it Worth the Effort
The other reason a lot of drivers told us they’re not driving is because they have become discouraged. There is so little business out there right now compared to before that they are literally struggling to make $5 an hour after expenses. At that rate, they rather just sit at home.
Unemployment Paying More than Driving Ever Did
More than a few drivers also told us that they prefer not to drive for either or both of the reasons stated above and because the government’s Pandemic Unemployment Assistance (PUA) program is paying them $600 a week on top of their state’s unemployment payment, many told us that they are actually making more now than they ever have from driving. We can expect many of them not to go back to work until their unemployment benefits are fully exhausted.
The 5.3% of drivers who gave us Other reasons for doing less rideshare driving told us that they had either stopped working altogether for now or they had switched from rideshare to food deliveries. A little more than a quarter of drivers told us (see below) that they had switched from rideshare to food deliveries.
Why a Few are Driving More
18.2% of drivers told us they were driving more than before. Approximately 86% of those said the reason was because they needed the money and driving more hours was the only way to get it. A quarter told us they had lost another job, presumably their primary job, so they’re putting more time into rideshare driving in an effort to make up for some of the lost income from their other job. And a handful of drivers told us they’re driving more because there are fewer drivers on the road so they’re actually making a little more than they did before.
Nearly Half of Drivers Say They’re “Not busy at all” When They Drive
46.9% of drivers told us that when they do drive these days, they’re “not busy at all”. Another 31% told us they’re “a little less busy than before”. That’s more than three quarters (77.5%) of Uber and Lyft drivers who say they are less busy to much less busy than they were four months ago.
Another 16.3% said they were busier than before. And again, the reason they gave for that is that there are so few drivers in their areas now that they’re actually able to stay busier even though business overall is down.
Rideshare vs. Deliveries
About a quarter of drivers (28.6%) have switched from doing rideshare to food deliveries. On the other hand 44.2% say they have not switch and have no intention of doing so.
Of the delivery companies they’re working for, Uber Eats is the most popular. No doubt because most of these are Uber rideshare drivers, so it’s very easy to switch over to Eats. The bad news for these drivers is that most of them (52.6%) of them say they don’t make as much doing deliveries as they do with rideshare.
Real Comments from Real Drivers
In all our surveys, we ask drivers to write us with any final comments they may have. Here are a few from this survey that pretty well sum up the sentiments we heard from a lot of drivers.
- I can’t risk my health because of my children. I was making about 600 to 700 a week before so the 600 federal unemployment has been a godsend, the with that expiring soon I don’t know what’s going to happen.
- I’m doing okay financially, but the app logistics suck (weird ride requests being sent from far away and they don’t give us long pickup fees for it). They do really need to quit onboarding in my area.
- Because I am nearly 74 years of age and with heath problems I haven’t taken the chance of driving during the pandemic.
- I’ve tried it a couple of days here and there, it’s slower than it was in my area and I choose to stay in my area. I do have issues with customers not wanting to wear a mask and getting bent when asked to. I’m not sure if I’ll keep driving or not. Losing my car might be worth not risking my daughters life as she has severe asthma. I’ve been looking for work but I’m older with some physical issues that prevent me from standing and walking for long periods of time. Even driving hurts but I can set my hours and take breaks when I need to.
- Didn’t work for past 2 wks. Virus count way too high now.
- I’m adjusting to the “new normal”. I’m upset that UberSELECT is ending in my location; I see it as a pay cut and nothing else.
- if the governor tries to shutdown Texas again i will be done for
- Fewer drivers are out right now which means it’s easier to find a passenger.
- If a mask is required,then I’m not safe. No driving until I’m safe.
- Not sure If I’ll be returning to driving. I just turned 70 years old and I have underlying health problems until we get a handle on this disease I will be sheltering at home.
- concerned about getting corona virus from passengers. Im driving further to pick up passengers
- I feel I have been let down by our political leaders.
- Should b compensated for the risk
- I’m no longer drive for either company
- Regret buying a car for ride share
- With the pandemic business is down 50% I like many of my friends that are doing this business have now started taking private rides I have full coverage for insurance which cost $5000 per year I fill my tank daily which is $30 per day and I have a car payment of $291 per month These expenses do not include Repair’s tires oil changes car washers etc. this is not a sustainable business and a small market I will be diversifying soon
- Honestly, bittersweet. It’s sad to see the rideshare industry go down the drain, and we all know it is. Just matter of time.
- In March 2020, it was my last week that I rideshare’d
- On the fence-not sure about continuing to drive
- No one should be working until there is a cure. Or if you are you should be getting more than just the regular pay
- I’m not driving at this current time. I live in Houston and the virus is out of control.
- When we get to where the virus numbers go down and stay down, I would like to drive again.
- Uber has not helped us at all. I thought we would get at least a bonus or benefit for our dedication
- uber seems to be oversaturating the food delivery market with too many drivers and not enough deliveries to make money
- Are cases of covid are at an alarming rate. And I am driving alot of customers who are going to get tested or have already had covid which is scary. I am not feeling extremly safe driving. But…