Researchers surveyed more than 1,100 Uber and Lyft drivers, asking them what vehicle they drive, how many miles they drove and their self-reported revenue. The researchers combined that information with typical costs for gas, maintenance and depreciation, figures which are widely studied, to calculate the real profit that drivers take home.
With that rate of income, 74 percent of all drivers for the ride-sharing companies earn less than their state's minimum wage, the researchers concluded. Uber responded in a statement: "While the paper is certainly attention grabbing, its methodology and findings are deeply flawed. We've reached out to the paper's authors to share our concerns and suggest ways we might work together to refine their approach", an Uber spokesperson wrote. For example, the average driver would declare taxable profit of $175 rather than the $661 earned.
"At an average of $661/month in net profit per driver and with hundreds of thousands of drivers in the US alone, the standard mileage deduction facilitates billions of dollars of untaxed income, and hundreds of millions of unrealized tax revenue", the paper notes. In 2016, that number was $0.54 per mile. "For tax purposes the $0.54/mile standard mileage deduction in 2016 means that almost half of drivers can declare a loss on their taxes", writes the study's authors. Existing surveys also tend to focus on hourly rates rather than per-mile rates; nearly none of them look at driver costs. They also said that detailed driver costs should be the subject of future study. As contractors, they would likely also hold a separate part-time job to bolster their income.
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The Massachusetts Institute of Technology paints an especially grim portrait of life as an Uber or Lyft driver.
The Guardian obtained a response from Uber, which criticized the study's findings as false.
NPR's Aarti Shahani reported in December that Lyft began a program to give drivers "access to discounted GED and college courses online" in a recruiting effort.
Uber counters that the MIT study doesn't accurately portray driver earnings. Recode listed the initiatives Uber rolled out in 2017 in order to appeal to drivers, including 24-hour phone support, paid wait time and paying drivers if customers cancel after a certain amount of time.