Discussing Community Issues Ft. Readers' Comments
Download Solo to start your 7 day free trial & join the community of over 250K gig workers who are optimizing their time and maximizing their earnings!
Join RSG contributor Paula as she recaps Harry's and our readers' thoughts on Rideshare community issues.
Harry is often asked what he thinks are the top 3 issues the driver community is currently facing. Below are his answers as well as some feedback from readers, just like you.
FEATURED YOUTUBE VIDEO
Uber's Take Rate | Do They Really Take 40-60% Of The Fare?! Watch the episode and subscribe so you don't miss the next drop!
Uber and Lyft Take Rate
Take rate is such a HUGE self-own by these companies that it made it to #1 on my list for the first time ever. Most drivers think that Uber/Lyft’s take rate is 60, 70 or even 80%!
Yet the actual number is much lower (our analysis has shown it to be between 20% and 40% over the past 10 years).
There’s a huge misconception among drivers since there are individual trips where the companies do take up to 80% (another bad idea tbh). But the average over a week or a month is much lower—drivers, check your weekly statements.
Not every driver is “buying it,” though. On RSG’s YouTube page, @megalojerk84 commented, “My concern is if they're lying about their take rate, then they're lying on our tax forms as well.”
Commenter @AngelRuiz-hb9-cv agreed with the other commenter and added that in NYC, Uber is being forced to pay back millions to drivers. Essentially, if Uber was fraudulent in one city, there’s nothing to say that it wasn’t fraudulent across the nation. They just haven’t been caught yet.
That begs the question, if you can’t trust the company in the first place, how can you be sure they aren’t fudging their numbers to get a base of 20-40% take rate?
hereiammylord suggested a solution: Hiring an impartial, independent, trustworthy third party to verify the data coming from Uber, such as how much riders pay versus how much drivers earn.
Driver Earnings
Driver earnings are way down. Dara keeps parroting the line that drivers are making 30% more over the past 5 years, but Uber’s own numbers say that driver earnings are down about 10-15%.
And when you add in inflation/increased expenses, the pain for drivers feels even worse. One of the big reasons for the dip in earnings is that Uber’s driver supply is at an all-time high.
So it makes sense: more drivers = Uber can pay drivers less.
Great for Uber and their bottom line, not so good for drivers.
Several drivers across our platforms said that driver earnings is the number one problem, and some believe it’s the only problem. It’s understandable for this to be drivers’ biggest concern.
Recommended by LinkedIn
They are trying to earn a livelihood, and if the money they are earning keeps decreasing, they’ll have to crunch the numbers to see if it’s still worthwhile.
Personally, I’d rather make $20 an hour driving for Uber than make $20 an hour flipping burgers, but that’s just my perspective.
On RSG’s Facebook post, Steve Agriesti commented, “Agree. Adding to #2, the gig economy profits from ethnic/immigrants (and generally poorly educated drivers) who do not grasp independent contract work, business margins, etc.
Whether deliberate or not, it appears to be exploitation. Are the CEOs modern-day Robber Barons?”
That’s an interesting take. For those that don’t know, a robber baron is a term used to describe successful industrialists from the 19th century who often used ruthless and unethical tactics to turn a profit for their businesses.
RECENT PODCAST EPISODE
RSG253: Getting Gig Workers Insurance/Benefits With GigEasy Listen + Subscribe on Apple and Spotify!
Driver Safety
On a statistical basis, safety incidents are rare for both riders and drivers. Uber does 20+ million trips a day, so even 20 very serious (i.e., death) safety incidents every single day have a 1 in a million chance of happening.
But there’s no doubt that it can feel dangerous at times—late nights, dark alleys, passengers with fake names, etc.
There’s always more to be done here but this is one area where I give Uber credit in that they have piloted a number of dash cam solutions, recording options, etc., so they seem to be making some progress. Lyft has also made some strides with their partnership with ADT.
On LinkedIn, Ryan McMahon made a connection between take rate and safety: “Interesting to see the link between safety and the take rate. The more safety lapses lead to incidents, the higher insurance prices are which increases the costs and the required take rate to manage the expense load.”
And really, you could make the link between all three. If drivers are feeling the strain of not earning enough money, or they are trying to meet a goal for a bonus or guarantee given by one of the platforms, they may be rushing and not taking as many safety precautions as they should.
Desperate drivers lead to safety incidents which leads to Uber taking more from the drivers pay in order to offset rising insurance costs.
It’s all a loop that feeds each other.
Did a friend share this with you? Subscribe here to receive your own weekly updates on the rideshare industry.
You can also join our YouTube channel and podcast community for even more insights, interviews, and tips.