For months now, Uber prices have increased as rideshare services struggle to recruit enough drivers to meet demand: According to the research firm Rakuten Intelligence, ride costs in March and April were 37 and 40 percent higher than they were the year prior, while prices in early June in New York City were 50 percent more than pre-pandemic rates.
Lyft, for one, has previously claimed that this is a boon for the drivers who have come back. (Over half of the industry’s gig workers reportedly stopped driving during the pandemic, and many of those on the sidelines are waiting for pay to improve before returning to the notoriously exploitative services, if they choose to do so at all.) In May, Lyft cofounder John Zimmer claimed that in many driving markets, hourly earnings were up “meaningfully” — even some “all-time highs” — compared to pay rates before the pandemic.
But according to the Washington Post, drivers at Uber are not being paid extra, although passengers are shelling out as much as $248.90 for a ride from midtown Manhattan to JFK. Contractors are being paid for time and distance, and in some cases with predetermined surge bonuses on top that are determined by the company. “The customer may be seeing this huge price but that doesn’t mean the driver is being compensated accordingly,” one former Uber engineer told the paper.
The situation in California is particularly frustrating. For years, Uber’s rate for drivers was based on their customer’s fares, as the company argued that drivers were independent contractors. Once Californians confirmed that status by voting in favor of Proposition 22 last November, Uber stripped the better pay rate from its Golden State drivers, just as prices rose amid the shortage this spring. Lyft spokesman Eric Smith, meanwhile, told the Post that passenger prices and driver pay have not been connected since 2016, which brings into question what the company’s executive meant when he said driver earnings are up “meaningfully.”
