As protests by Uber and Lyft drivers and other gig workers boiled over in recent months, some observers asked: At a time of low unemployment, why do they keep turning on apps to find work if they’re unhappy with the pay and other conditions?
There are many complex reasons, some related to the unequal distribution of economic prosperity. There’s also one very simple one: Gig jobs let people set their own hours.
It’s not possible to quantify how many ride-hail drivers are actually discontented. The recent attempts at Uber and Lyft strikes had little if any impact on service, implying that most drivers kept working. Millions of people work for the two services in the United States; many say they’re content.
Of those who are unhappy, many already vote with their feet. Uber and Lyft turnover rates are high. Both companies say that the majority of drivers are very part time, putting in fewer than 10 hours a week.
Still, there remains a significant component who work full time and rely on ride-hailing for the bulk of their income, even if they’re unhappy with it. Here are some reasons they stay.
Setting their own schedules: Flexibility is priceless for those juggling child and elder care, school and other responsibilities, as well as people starting their own businesses and employed people who need extra income.
Uber and Lyft were “groundbreaking as the first systems where millions of people can set their own hours and earn money proportionate to the time they put in without it having to be continuous bunch of hours,” said Arun Sundararajan, a New York University business professor who studies gig companies. “Certain segments of the population, such as single parents, need that absolute flexibility.”
Conversely, many retail and fast-food jobs, which otherwise might be alternatives for drivers, now assign workers varying, unpredictable shifts, called on-call scheduling.
“On-call scheduling has taken control of people’s lives so they cannot plan them,” said Katie Wells, a postdoctoral fellow with Georgetown’s Kalmanovitz Initiative for Labor and the Working Poor. “If you work at McDonald’s you can’t plan doctors’ appointments or children’s lives. No wonder Uber is the answer. It offers a solution: a pernicious one.”
It’s pernicious, she and others said, because drivers exert little control over what they earn per hour — and even their scheduling flexibility is manipulated by bonus offers and higher rates at certain times. Bonus offers fluctuate, while Uber and Lyft change how rates are structured.
“Lyft drivers overwhelmingly prefer the freedom of working where, when, and how much they want,” the company said. “Many are moms, students, seniors or veterans and 75% of them drive less than 10 hours a week. In fact, 96% of drivers say flexibility is the most important thing to them.”
“Drivers are at the heart of our service — we can’t succeed without them,” Uber said. “Whether it’s more consistent earnings, stronger insurance protections or fully-funded four-year degrees for drivers or their families, we’ll continue working to improve the experience for and with drivers.”
Low barriers to entry: For marginalized groups — immigrants with limited English proficiency, people without much education or experience, seniors facing ageism, people of color subject to racism — ride-hailing provides a quick way to bring in income. Historically, taxi driving has played a similar role for many immigrants.
“It’s easy to join this workforce,” said Meera Joshi, a visiting scholar at New York University who, as head of the New York City Taxi and Limousine Commission, delved into drivers’ working conditions and oversaw changes such as a minimum pay rate. “There aren’t a lot of other options for people that allow them to work whatever their circumstances are.”
Sacramento resident Ann Glatt has driven for Lyft for four years. “I was a stay-at-home mom for years and having such a long gap in employment doesn’t look good on your resume,” she said.
People who rely upon online gig markets like Uber and Lyft for their primary income tend to be lower-income, nonwhite and lacking college degrees, the Pew Research Center found.
“When you’re in a fragile economic situation, you’re worried about what’s due the next day or the next week, not whether this is the right stepping-stone for you,” Joshi said. “This is a group that’s usually $1,000 away from a crisis. They will keep doing it because they need that thousand dollars. They don’t have the luxury of thinking about long-term options; they’re thinking about the next bill.”
The sunk cost fallacy: Economists and psychologists say most people feel an emotional connection once they’ve put time and energy into something, making it hard to move on.
“People don’t want to quit because they’ve invested time, money and resources into learning this new line of work,” said Harry Campbell, a Los Angeles driver who runs the RideShare Guy blog and podcast. “They feel, ‘If I quit, I wasted all that time.’”
Some drivers have an even stronger “sunk cost”: They bought or leased a car for ride-hailing and have to keep driving until it’s paid off or the lease expires.
“Building a movement”: For Lauren Swiger of Oakland, the past four-plus years of driving for Lyft allowed her to raise her daughter as a single mom and do massage therapy work while avoiding the long hours she can’t physically tolerate.
Although she’s disgusted with what she calls “a continuing race to the bottom for poverty wages,” she wants to stay a driver because she’s inspired by the recent protest campaigns. She played a prominent role in rallies against both Uber and Lyft facilitated by Gig Workers Rising this year.
The protests happen against the backdrop of a pending state bill, AB5, that could turn Uber and Lyft drivers into employees — or force the companies to make significant changes.
“I’m not quitting because we’re building a movement,” Swiger said. “The app keeps us disconnected, but now we are organizing and getting traction so we can get some basic worker rights. We’re talking to all our passengers about this, making them our allies. The fact that we’re able to start speaking truth to power is huge.”
Hidden expenses: It’s human nature: Many drivers simply look at their paychecks, not calculating all the expenses that sap those amounts.
“Uber and Lyft usually refer to gross driver pay of about $27 an hour” after the ride service’s cut, said Michael Reich, an economics professor and co-chair of the Center on Wage and Employment Dynamics at UC Berkeley. “That sounds very good. But a big chunk of their pay goes to expenses. Some of those expenses are in the future because their car will deteriorate” faster since it’s being driven a lot. Others are more immediate, such as gasoline.
Georgetown’s Wells did a study of Uber drivers in Washington. “We were surprised to find that all 40 of the drivers we interviewed and surveyed did not actually know what they had earned or lost,” she said.
Annette Rivero’s experience encapsulates both the advantages and disadvantages of being a ride-hailing driver.
She quit an $80,000 a year health care administration job at Stanford two years ago to drive for Uber and Lyft because she needed more education to advance in her career. She thought the flexible work would let her cover expenses and attend college while caring for her five kids, ages 5 to 19.
But within a year, she said, as the companies cut rates, she needed to drive around the clock to bring in enough money to pay the bills on her modest San Jose apartment. She logs into the apps after dropping the kids off at school and drives until she picks them up. Then it’s time for homework and dinner — and then she often drives an evening shift too while her boyfriend watches the kids.
“I haven’t been able to go back to school because of the amount of hours I need to be on the road,” she said. Since she still needs flexibility to study, she went through the training and exam to be a notary public, planning to launch a business as a mobile notary while she studies for a new career helping other people become entrepreneurs.
“Uber (and) Lyft and the opportunities to make money and have a flexible schedule showed me what I was missing” by being locked into 9 to 5 hours, she said. “But I feel they exploited that (by cutting rates) because they know how valuable that is to people.”