Outside of New York City, Uber drivers make $12-$15/hour. If you get more, you’re doing great. If you happen to get a tip, even better, but Uber discourages tips.
And that’s gross before expenses, such as gas and car washes.
Uber’s lengthy history of deception regarding driver earnings
I’m sure you heard that Uber drivers make a lot more than that.
Uber has long claimed high earnings for its drivers. They use a practice called anchoring, introducing a concept or number that is clearly ridiculous. But the act of saying the number sinks it into your head, creating a reference point, against which other claims are judged.
In 2014, Travis Kalanick, Uber’s Co-Founder and CEO, said:
“The net income for a driver in New York is $90,000 a year. The net income for a driver in S.F—the median—is $74,000 a year. At the end of the day the drivers are doing ok, they’re doing great.”
This was (and is) ludicrous. Gross income minus expenses leaves net income. So NY drivers grossed much more than $90K? Crazy.
And the second claim, the one about San Francisco, is even worse. Again, Kalanick claims SF drivers gross more than $74K/yr. But here they say that is the median income, meaning that half of their drivers make even more! Outlandish.
Although many have long-questioned Uber’s claims, including this September 2014 Washington Post article, the company, valued at $68 billion and the most valuable startup in history, only recently got officially penalized for the practice.
On January 19, 2017, the Federal Trade Commission announced that it had reached a $20 million monetary judgment against Uber Technologies, Inc., resulting in part from its deceptive representation of driver income.
When it comes to reporting on the wages of its drivers, don’t trust Uber. I don’t trust self-reporting surveys, either. But I do trust Uber’s own statistics when revealed to government watchdogs.
Uber Technologies, Inc., as a private company, holds no responsibility to reveal income figures or other statistics. But courts can compel it to release such information in a suit or complaint.
What the FTC’s stats reveal about Uber driver’s income
The FTC takes on the same $90K/$74K claim mentioned above. They cite as the source a now-deleted website post dated May 2014.
“Notwithstanding these representations,” the FTC writes in is complaint, “for at least the year preceding the CEO’s statement (May 2013-May 2014), the median uberX Driver in New York City earned $29,000 less annually than Uber claimed and the median uberX Driver in San Francisco earned $21,000 less annually than Uber claimed in its website post when Driver’s hours are standardized to a 40-hour work week.”
The median NY driver made $61,000/yr. Not bad, you might think. But in New York, drivers have some of the highest expenses in the country, including commercial auto insurance.
Misleading Craigslist ads posted by Uber
Not exactly comforting to think that your Uber driver may have been recruited on Craigslist, but it appears to be a practice of the company to post ads there. The FTC made issue with Uber’s claims of specific income levels in ads dating from January 2015 to March 2015.
Here are the claims and the percentage of drivers who obtained the claimed amount in various US cities.
|City Craigslist Advertisement||Quoted Hourly Fare||Percent of Drivers Averaging Quoted Hourly Fare|
|Los Angeles||$20||< 20%|
|Orange County||$20||< 20%|
|San Diego||$20||< 20%|
|Washington D.C.||$21||< 20%|
|San Francisco||$29||< 20%|
|New Jersey||$21||< 30%|
Fewer than 10% of the drivers in Boston received $25/hour. In Minneapolis, fewer than 10% of the drivers make $16/hour!
Granted these figures are now about two years old, but I would not expect them to have changed much. Indeed, Uber cut rates in January 2016, so if anything, income could be lower. Uber always claimed that cutting rates increased income for drivers, but I did not find that to be the case. Lower prices lead to shorter trips, which pay Uber better. (but that’s another post).
The lesson from these statistics: reduce your income expectations going into Uber driving, and never trust anything Uber says.