The amount someone can earn driving for Uber and Lyft has been the subject of intense debate in recent years. Now, Lyft is bringing some clarity to the conversation around how much drivers earn on an hourly basis. In short: it’s complicated.
First, Lyft says that driver work generally breaks down into three sections: turning the app on and waiting for requests, driving to pick up passengers, and driving passengers to their destinations. The ride-hailing company says that since drivers can generally do whatever they want during that first period — driving, working for another app, or nothing at all — it shouldn’t count toward a driver’s hourly earnings. In that respect, just accounting for periods two and three, Lyft drivers’ median earnings are $29.47 an hour nationally and $31.18 an hour in the company’s top 25 markets.
But Lyft also wants to be fully transparent. So it also shared its estimates that cover the first period of time, which is turning on the app and waiting for requests. Factoring that in, Lyft says drivers’ median earnings are $18.83 an hour nationally and $21.08 an hour in the top 25 markets.
Of course, this doesn’t take into account driver expenses, such as insurance, fueling, cleanup, and other costs associated with ride-share driving. Lyft says it prefers Harry “The Rideshare Guy” Campbell’s estimates of $3–$5 an hour.
The topic of hourly earnings in the world of ride-sharing is extremely touchy. An Uber study in early 2015 said its drivers in 20 cities averaged more than $19 an hour, but a Buzzfeed survey later found Uber drivers in Denver, Detroit, and Houston earned less than $13.25 an hour after expenses. In Detroit, they brought home just $8.77 an hour, on average.
A recent MIT study found Uber and Lyft drivers to be earning far below the minimum wage after factoring in expenses. The study, by the MIT Center for Energy and Environmental Policy Research, found that drivers’ median pretax profit was $3.37 per hour, using results from a survey of more than 1,100 workers of the ride-hailing companies. Uber and Lyft, sensitive to reports that drivers are underpaid, objected sharply to the study’s methodologies. MIT later said it would revisit its study after a tweeted challenge by Uber CEO Dara Khosrowshahi.