I have no problem hailing an Uber - they are really, really cheap. However, it's a raw deal for drivers. Uber turns a blind eye to driver-contractors driving without commercial vehicle insurance. It has to, as the additional cost (which is pushed onto the driver) would cause the driver's hourly rate to plummet even further. In addition, there is no way to purchase commercial insurance on an hourly basis - therefore part-time drivers would be squeezed out. The flat-rate $1 safe rides fee causes low-distance fares to be even more unprofitable, even when many short trips are already a bad deal due to the overhead involved in each pickup and drop-off.
To fix this, Uber should probably cover drivers with an on-demand commercial policy while they are logged into the app. The flat per-ride fee should go away. And while I doubt this is going to happen, Uber should probably also reduce the commission they take per ride.
So basically you mean than Uber can only make money if most their drivers do not respect the law. Which gives Uber an unfair advantage over the competition (regular taxis that do respect the law ). It's like saying employer X doesn't check if his employees are legal workers, because if he did it would be too expensive to do business. But hey, even startups got to hussle to make a good living.
The only thing that amazes me about uber (apart from its current valuation) is that the taxi industry is powerful enough to prevent the issuing of more taxi medallions, but not powerful enough to get the current laws enforced against uber. Assuming uber recognised this in advance (I don't have any evidence that they did) then this was pretty clever.
Uber may additionally benefit from regulatory arbitrage, but it is not obvious that their business requires it.
I've since stopped using Uber even as a rider. The way they treat the drivers is pretty horrendous and I don't want to be an enabler to that. Lyft is a bit better because at least I can leave the driver a reasonable tip through the app.
It takes all of ... what, like 45 seconds to download Lyft? If Uber is so bad, why don't all the drivers just switch?
I don't know enough about the economics of any particular driver's situation to know how many people it works for or doesn't, but (1) believing that Uber drivers get screwed, (2) believing that, say, Lyft drivers have it much better, AND (3) recognizing that far more people choose to drive for Uber than for these other platforms, requires us to believe some rather surprising things about the subjective mental states of the many, many Uber drivers, right?
I mean: Damn, I hate my job, my company treats me terribly, and a substantially identical job is about 4 taps and 2 minutes away, and ... I guess I'll just keep working for The Man.
Why would anyone do that?
Needless to say, unless I felt legitimately fearful for my life (which rarely ever happened) I would always rate 5 stars. I realised a lot of these Uber drivers (usually migrants with broken English) probably didn't have many other options to earn money. An almost consistent sentiment amongst those drivers was they were working long hours and support family (not just a wife and children but parents/relatives). My reasoning for this was I am paying like half the cost of what a taxi would cost me, so why not 5 stars?
I think Uber is great for a certain subset of people. While most people who frequent HN on six figure tech salaries would definitely struggle to live on an Uber salary, a lot of people rely on it. In all honesty, I couldn't do it and I have a certain level of respect for those willing to earn so little and work so much to support their families. As a passenger Uber is great, but you can't deny that drivers get absolutely shafted unless they're driving through surge pricing periods and areas. I always rate 5 stars when I get an Uber unless of course the driver is swerving all over the place, speeding or doing dangerous things to endanger my life (which has happened like twice in all of the time I have used Uber).
Aside: Anyone else find the article sporadically refresh? Made it very difficult to read the article.
Yes. It did for me in Firefox on the desktop, but not on mobile safari. I thought I was crazy when it did it the first time but the second time, I knew it was the citypaper site.
This is just such a perfect observation. What we are seeing here is an end-run around the minimum wage. The so-called "1099 economy" is increasing employment of unskilled workers who would otherwise be unemployable at the mandatory minimum.
Where else are people going to find a job they can set their own hours, work 12-hours a day, 80 hours a week, making $5/hour sitting down? If the minimum wage weren't so damn high there might be competitive alternatives.
Keep in mind, the goal isn't to "make" $80k, or even $60k, and then lose over half of it to taxes and phased-out benefits. If you're supporting your wife and two kids, the goal is to make about $32k, which on a 1099 will work out to just about maximize your EITC, food stamps, Medi-Cal, etc. and in the end your net value is equivalent to about $100k fully loaded (the employer's fully loaded cost) of regular W-2 employment.
It's about where it was 50 years ago, measured in real dollars: http://www.pewresearch.org/fact-tank/2013/12/04/5-facts-abou...
By other measurements, it's relatively low: http://www.cepr.net/publications/reports/the-minimum-wage-is...
That's true for everyone using Uber. You're not supposed to rate it relative to a taxi, but relative to other Uber drivers.
Actually you can.
I think the simplest argument is the best one: They choose to do this voluntarily, every single day they drive.
It was a strange experience, but clearly, the Uber driver pool is merging with the taxi driver pool. And it's bringing the bad elements you'd expect from a typical cabbie.
This was the common sense amongst all working people for most of the 20th century. Samuel Gompers, maybe the most conservative labor leader of his time, said "You cannot weigh the human soul on the same scales as piece of pork." And working people, along with the management class for the most part, understood this to be an undeniable truth. In fact, this piece of common sense was enshrined into US law with the Clayton Act of 1914, which stated "The labor of a human being is not a commodity or article of commerce." But in the last 20 years, as capital has gained the firm upper hand, the common sense understanding has shifted towards the idea that labor is in fact a commodity.
The ideas behind the so-called "on-demand workforce" further solidify the notion that labor is a commodity. After all, you can order an uber ride just as easily as you can order vitamins online.
It's so pervasive that even I, someone born into a union family and a firm believer in the idea of worker solidarity, have to force myself to believe that labor is not a commodity. Why? The business class treated labor as expendable in 1915, just as they do in 2015. Why did working people understand this truth in 1915 but not today? I don't know.
I read a recently released sociology book earlier this year (going crazy looking for the title/author, can't find it), that posits millennials are far more likely than any recent generation to blame themselves for the problems they face. It's part of the reason that the self-help industry is bigger business than it's ever been. It's not always your fault. Our modern economy is built on rotten ideas like labor = commodity. If we want to do something about inequality, it's time that we subject fundamentally unjust ideas like these to a serious critique.
For someone who cares for the wellbeing of people at the bottom of the enterprise pyramids, the goal should be to design new organizations, with jobs that have latitude for learning and development, that is multi-disciplinary and creative. And many of the worst jobs today should be automated because they are not fit for human beings.
I'm not arguing whether it's a fact or not. Culturally, in 2015 America it's a fact. In 1915 America, the same "fact" would have been handily rejected, even by conservative minds. Most people only read the first chapter of Wealth of Nations where Adam Smith extolls the virtues of the division of labor. The second half of the book, where he warns that the division of labor taken to the extreme could result in unfathomable social ills, and we ought not ever travel down that path, is usually conveniently ignored.
I'm all for automating jobs that technology deems unnecessary. The solution isn't to push everyone into some multi-disciplinary creative class. Many people would be very happy as uber drivers, or any other menial job, if they were treated with respect by their employer. I'd say the solution begins with treating workers with dignity and respect.
Because of Ayn Rand. You think I'm joking, but she's the only intellectually serious defender of capitalism in the 20th century, and her influence is snowballing. When Rand was alive, members of her circle would rejoice at the extremely occasional mention of her name in print. Now, you can't turn on the TV or go anywhere online without hearing about her.
As a side note, human labor is not a commodity. However, "capital" (as you call it---you use a lot of Marxist terms in your post that do not reflect the reality of society) does not have an obligation to hire you on your terms, either. Labor is about a voluntarily trade.
I have a mental questionnaire I go through with 90% of the drivers and here is what I have learnt:
Uber vs Lyft: Drivers make more money with Uber, but rules of engagement are more relaxed in Lyft.
Uber & Ola (not vs): The drivers in India hone in on these three points:
1. They make 3-4 times the money they would if they were employed as a driver in a upper-middle class household (very common in India).
2. They feel respected and think of themselves as "Business owners" now. It is heartening to see how much the "feeling respected" theme repeats itself.
3. They know the good times won't last.
Unlike US, in India, Uber and Ola are do not take a cut from the ride. In fact it is the opposite - They keep the per kilometre cost to the end consumer lower than Auto Rickshaws and compensate the drivers the difference. In fact Uber has taken a "not-for-profit" model in India (and in Beijing).
Citation for not-for-profit: http://blog.uber.com/the-government-way
You can add a "function contentRefresh(){}" in your devtools js console to get rid of this. It was the only way I could finish the article.
var timer = setTimeout("contentRefresh()", 1000 * 60 * 5);function contentRefresh(){self.location.reload(true)}
"Hey Boss, I know a way to increase visits to our site by 6x..."
The "We're not a taxi service, we just sell software" is a load of crap.
How many apps take a piece of the gross? Purchase a license? Ok. A monthly fee for ongoing service? Sure. A chunk of all the money made from using it? I don't think so.
Now Uber is doing away with the regulation, and it's "perfect competition" again, the state of affairs when prices have to be so low that there is almost no profit for the suppliers. Uber will always make the most overall profit with their drivers just on the edge of survival.
Uber may actually set the fares just below the profitability point, because new drivers or those "driving for fun" actually put money on the table rather than being paid.
What? Has this ever happened before? Surely by now there would be specific examples of this taking place, if it were indeed a real thing.
> CP: Yeah, not really — when they take UberX into a new market like Philly, they start off by paying drivers a lot. So in the beginning, you get a lot of drivers who look like the drivers in Uber ads, like, suits and bottled water and no accents. And everyone gets the idea that Uber drivers have suits and make a ton of money. Then after a while, usually when a competitor comes in — you know Lyft just started up a couple weeks ago, right?
(CP is the person who wrote the article, not anyone being interviewed) -- How impressively unprofessional. The entire section that quote comes from is just the person writing the article yelling at someone she's ferrying around as an UberX driver. A more obvious hit piece could not have been written.
Also, the site keeps refreshing on me, losing my place in the article. I think it's related to the graphs, but I can't be sure. They randomly go into "loading..." mode when this happens.
It's not a myth, it is actually right in the agreement with your insurer, that your vehicle will not be used for commercial purposes.
Also, the $1 "Safe Ride" fee only covers excess liability, not collision. So if you're driving for Uber or Lyft, and the accident is your fault, everyone else is covered. Your passengers, the other driver(s), their vehicle(s). You have a totaled car with no insurance and have to pay your own medical bills.
That said, here are a few examples I found:
2013-09: http://www.citylab.com/commute/2013/09/real-future-ride-shar...
> As you might imagine, the front of the Dodge was badly damaged. The driver is now suing the driver of the Town Car, a vehicle with livery plates operated under the company SF Limo Car Service. The pedestrian, who broke her leg and injured her back, is suing both drivers. She is also suing – and this is what makes this crash particularly interesting – the transportation-tech company Uber.
2014-12: "Rideshare Drivers Still Cornered Into Insurance Secrecy" http://www.forbes.com/sites/ellenhuet/2014/12/18/uber-lyft-d...
> The don’t-ask-don’t-tell strategy usually works until there’s a crash. Ian, a Bay Area Uber driver, was off duty when his car was hit by another car in October. While he was filing a claim with Geico, they asked him if he ever worked for Uber or Lyft. “I panicked,” he said. “They put me on the spot. So I just answered honestly and said yes, but that I wasn’t working when this happened.”
2014-01 http://techcrunch.com/2014/01/02/should-car-services-provide...
> Uber posted a “Statement On New Year’s Eve Accident” on its blog, offering condolences to the victim and her family, but also distancing itself from any cuplability.
2015-03 http://www.insurancebusiness.ca/news/toronto-uber-crash-reig...
> After initially being told by an Uber representative in Chicago that he had to pay a $1,000 deductible, this was later recanted. Since he was not at fault, his personal car insurance fronted the entire bill. But because he lacks commercial coverage, questions arise as to who would be responsible if he had been responsible for the collision.
My problem with Uber is the requirement for a 2008 or newer car, and Uber decides if it's cool enough to represent their company. This is not an independent contractor Uber?
Let the driver use any registered vechicle? Your brilliant app will let the consumer look at the vechicle before before the hire? If you are worried about safety--just because a person has an older car doesn't mean it's less safe. Bring every vechicle in for a safety check if worried?
Maybe then, when the Uber driver finds out it's not the opportunity your company claims; they aren't stuck with a car they can't sell, or take a huge loss when selling your "acceptable" vehicle, or worse claim bankruptcy?
People are desperate for jobs--don't exploit them! I liked your company in the beginning(before I looked into the requirements of Uber).
"remember - UberBLACK and UberSUV vehicles MUST be black on black.
Please note: all vehicles must be 2010 or newer. The TLC is no longer renewing diamonds for vehicles that are older than 2011, so if your diamond is up for renewal, the TLC will not allow you to continue driving a 2010 vehicle. If you don't have TLC plates yet, you must get a 2011 or newer vehicle, as the TLC requires black cars to be under 5 years old."
But wait if you have one of these Uber approved automobiles you will "make $500 per trip, no risk, no strings attached"
Sign me up for a loan!
(Couldn't upload the list do to size)
My point is don't claim Independent Contractor status when you're obviously not. This link makes fun reading. Maybe you can explain automotive aesthetics to me, Honda, Chevrolet, or Volkswagen?
Worse than that, Uber externalizes the cost of commercial vehicle insurance onto the driver. A part-time driver is likely to not carry commercial insurance, due to the expense and to hyperbolic discounting: I'd rather have $X more in my pocket now than protection from a possible lawsuit later. This results in cheap fares at increased personal risk to the driver, who often doesn't fully understand that risk.
Also, these drivers have no ability to negotiate as a group, so they are at a disadvantage against a well-funded corporation that is quickly gaining market power and sets all of these terms.