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Uber Data and Leaked Docs Provide a Look at How Much Uber Drivers Make

27 points by coloneltcb 10y ago

tuna-piano 10y ago
I don't see how you can criticize Uber for low wages. Uber is a marketplace of buyers and sellers of rides. If Uber raised prices, more people would want to drive and less people would want to ride - leaving drivers sitting around doing nothing. And of course, as a market, Uber does pay drivers more (2x,3x...even 9x their normal wage!) at certain times. To consistently increase an Uber drivers income, you have to either reduce the supply of drivers or increase the demand of riders. This would be like criticizing ebay for the low price of used products.
- prostoalex 10y ago
  If advertised as such, such transparency would not create a problem. Most driver-oriented advertising quotes far higher numbers, e.g. http://hubbusiness.com/wp-content/uploads/uber-facebook.jpg http://hubbusiness.com/wp-content/uploads/uber-facebook.jpg http://static4.businessinsider.com/image/53eb7ef6eab8eab35070d9f8-1200/heres-another-uber-ad-making-a-similar-promise-to-lyft-drivers.jpg http://static4.businessinsider.com/image/53eb7ef6eab8eab3507... http://seattletimes.wpengine.netdna-cdn.com/opinionnw/files/2014/06/Screen-Shot-2014-06-13-at-10.44.35-AM.png http://seattletimes.wpengine.netdna-cdn.com/opinionnw/files/... The situation, I suppose, is not that bad, as most people are still free to sign up, drive for a few weeks to calculate their personal take, and then take it or leave it, but those who are leasing their car through Uber can't exactly break it off cleanly.
- gshulegaard 10y ago
  In general I am all for Uber and think that they are providing an interesting and creative service. That said, I don't really believe the argument that they are a marketplace. First, they don't allow either participant (rider or driver) to set prices. eBay has a bidding system where sellers can set price floors and buyers bid with each other. Uber abstracts the price away and sets it based on...well we don't _really_ know what they set it based on since their Surge Pricing "Algorithm" is closed source. Which plays into my second problem... Uber wants to classify drivers as contractors, which ties in nicely with their marketplace argument, but ultimately they set the price and standardize it across their service. I think Uber is the only company which can call their drivers "independent contractors" and then turn around and tell these contractors what they can "independently" charge. To forward the eBay parallel you drew, it would be like eBay telling a seller that, sure, you can sell your used Macbook Pro, but you have to set your price floor at $XXXX amount. This whole conundrum is magnified by the fact that neither driver or passenger even knows what the final price will be...so they can't accept or deny rides based on cost considerations...further taking away their purported "market" choice. Ultimately, I still generally support Uber, but (IMO) they are a service, not a marketplace.
  - taxicabjesus 10y ago
    The only difference between "ride sharing" and a well-run taxi company using 2012-era electronic dispatch systems is that the passengers get an instantaneous report of where their vehicle is.
  - prostoalex 10y ago
    Don't taxi companies qualify their drivers as independent contractors, while the rates are set by someone else (sometimes not even the taxi company, but some municipality)?
    - gshulegaard 10y ago
      You know I am not well informed on the finer details of the traditional taxi business...but a couple of things: * Taxi companies don't portray themselves as "marketplaces" for regulatory purposes. * Taxi rates are publicly displayed and known prior to rider entering service agreement with cabbie. * If you are correct, then rates aren't sent by cab companies but a regulatory, unlike Uber who sets the pricing dynamically. Although I want to reaffirm that I am generally a supporter of Uber and similar ride services, I just don't see them as marketplaces.
gbrayut 10y ago
I believe they are also 1099 contract workers as opposed to having W2 employee classification. 1099 means you owe self employment taxes, which can take a significant cut out of your gross earnings (ball park 10-15%). You also may have to make quarterly estimated tax payments or you can get a penalty fee when you file in April. Looks like https://ttlc.intuit.com/questions/2561815-uber-driver-questions https://ttlc.intuit.com/questions/2561815-uber-driver-questi... shows some of the tax issues related to being an Uber driver.
- deleted 10y ago
  [deleted]
- cheald 10y ago
  > 1099 means you owe self employment taxes, which can take a significant cut out of your gross earnings (ball park 10-15%). It's an additional 7.65% over what a W-2 employee pays directly. You pay both employer and employee halves of payroll taxes. But payroll taxes are generally believed to be fully incident on wages anyhow, regardless of how you file them (http://www.nber.org/papers/w5053 http://www.nber.org/papers/w5053 http://www.nber.org/papers/w9537 http://www.nber.org/papers/w9537), and you get additional deductions that W-2 employees don't, which may end up working in your favor. The bigger variable is the value and cost of employer-paid nonwage compensation, primarily health insurance and retirement plan contributions.
gersh 10y ago
It may not be profitable to a full-time Uber driver, but I think Uber can be a good part-time job. You can driver whenever you want, so you can work when no other work is available. Further, I've heard you can deduct car-related from your Uber earnings. If you have a car already and can do this successfully, your Uber income is effectively tax-free until the IRS cracks down.
cwilkes 10y ago
I love the bit about Uber not knowing how to calculate driver costs. One of the most data driven companies in the world can't figure out how to create a lookup table of gas prices, mileage, and car deprecation?

27 points by coloneltcb 10y ago

I don't see how you can criticize Uber for low wages. Uber is a marketplace of buyers and sellers of rides. If Uber raised prices, more people would want to drive and less people would want to ride - leaving drivers sitting around doing nothing. And of course, as a market, Uber does pay drivers more (2x,3x...even 9x their normal wage!) at certain times. To consistently increase an Uber drivers income, you have to either reduce the supply of drivers or increase the demand of riders. This would be like criticizing ebay for the low price of used products.

prostoalex 10y ago
If advertised as such, such transparency would not create a problem. Most driver-oriented advertising quotes far higher numbers, e.g. http://hubbusiness.com/wp-content/uploads/uber-facebook.jpg http://hubbusiness.com/wp-content/uploads/uber-facebook.jpg http://static4.businessinsider.com/image/53eb7ef6eab8eab35070d9f8-1200/heres-another-uber-ad-making-a-similar-promise-to-lyft-drivers.jpg http://static4.businessinsider.com/image/53eb7ef6eab8eab3507... http://seattletimes.wpengine.netdna-cdn.com/opinionnw/files/2014/06/Screen-Shot-2014-06-13-at-10.44.35-AM.png http://seattletimes.wpengine.netdna-cdn.com/opinionnw/files/... The situation, I suppose, is not that bad, as most people are still free to sign up, drive for a few weeks to calculate their personal take, and then take it or leave it, but those who are leasing their car through Uber can't exactly break it off cleanly.
gshulegaard 10y ago
In general I am all for Uber and think that they are providing an interesting and creative service. That said, I don't really believe the argument that they are a marketplace. First, they don't allow either participant (rider or driver) to set prices. eBay has a bidding system where sellers can set price floors and buyers bid with each other. Uber abstracts the price away and sets it based on...well we don't _really_ know what they set it based on since their Surge Pricing "Algorithm" is closed source. Which plays into my second problem... Uber wants to classify drivers as contractors, which ties in nicely with their marketplace argument, but ultimately they set the price and standardize it across their service. I think Uber is the only company which can call their drivers "independent contractors" and then turn around and tell these contractors what they can "independently" charge. To forward the eBay parallel you drew, it would be like eBay telling a seller that, sure, you can sell your used Macbook Pro, but you have to set your price floor at $XXXX amount. This whole conundrum is magnified by the fact that neither driver or passenger even knows what the final price will be...so they can't accept or deny rides based on cost considerations...further taking away their purported "market" choice. Ultimately, I still generally support Uber, but (IMO) they are a service, not a marketplace.
- taxicabjesus 10y ago
  The only difference between "ride sharing" and a well-run taxi company using 2012-era electronic dispatch systems is that the passengers get an instantaneous report of where their vehicle is.
- prostoalex 10y ago
  Don't taxi companies qualify their drivers as independent contractors, while the rates are set by someone else (sometimes not even the taxi company, but some municipality)?
  - gshulegaard 10y ago
    You know I am not well informed on the finer details of the traditional taxi business...but a couple of things: * Taxi companies don't portray themselves as "marketplaces" for regulatory purposes. * Taxi rates are publicly displayed and known prior to rider entering service agreement with cabbie. * If you are correct, then rates aren't sent by cab companies but a regulatory, unlike Uber who sets the pricing dynamically. Although I want to reaffirm that I am generally a supporter of Uber and similar ride services, I just don't see them as marketplaces.

gbrayut 10y ago

I believe they are also 1099 contract workers as opposed to having W2 employee classification. 1099 means you owe self employment taxes, which can take a significant cut out of your gross earnings (ball park 10-15%). You also may have to make quarterly estimated tax payments or you can get a penalty fee when you file in April. Looks like https://ttlc.intuit.com/questions/2561815-uber-driver-questions https://ttlc.intuit.com/questions/2561815-uber-driver-questi... shows some of the tax issues related to being an Uber driver.

deleted 10y ago
[deleted]
cheald 10y ago
> 1099 means you owe self employment taxes, which can take a significant cut out of your gross earnings (ball park 10-15%). It's an additional 7.65% over what a W-2 employee pays directly. You pay both employer and employee halves of payroll taxes. But payroll taxes are generally believed to be fully incident on wages anyhow, regardless of how you file them (http://www.nber.org/papers/w5053 http://www.nber.org/papers/w5053 http://www.nber.org/papers/w9537 http://www.nber.org/papers/w9537), and you get additional deductions that W-2 employees don't, which may end up working in your favor. The bigger variable is the value and cost of employer-paid nonwage compensation, primarily health insurance and retirement plan contributions.

gersh 10y ago

It may not be profitable to a full-time Uber driver, but I think Uber can be a good part-time job. You can driver whenever you want, so you can work when no other work is available. Further, I've heard you can deduct car-related from your Uber earnings. If you have a car already and can do this successfully, your Uber income is effectively tax-free until the IRS cracks down.

cwilkes 10y ago

I love the bit about Uber not knowing how to calculate driver costs. One of the most data driven companies in the world can't figure out how to create a lookup table of gas prices, mileage, and car deprecation?