My understanding of the argument is that the way Uber's elastic pricing works means that once supply reaches some critical upper limit, there's so much competit

My understanding of the argument is that the way Uber's elastic pricing works means that once supply reaches some critical upper limit, there's so much competition among drivers that the payoff for any individual driver gets too low and they are forced to go elsewhere. Personally, I don't think the pandemic timelines align well enough to support the idea that this is specific to the pandemic (though I do agree with it being a thing outside of the scope of the pandemic). IMHO, there was a period of time when prices tanked because rider demand cratered but drivers were still relying on Uber as their safety net, but as the pandemic went on, drivers - especially the full-time ones - were forced to find work elsewhere because there was simply no income to be made from Uber rides. This conversely meant that when riders started coming back, the driver supply was simply not there to match the resurgence in demand. The thing about Uber is that it's roughly equivalent to fast food worker type of work: for most people, it's not meant to be a long term career, but rather just a crutch to try to get onto the next rung in the ladder. If you are indeed going to do this sort of work full time forever even despite a market saturated with drivers, employers like McDonalds have much better propositions, e.g. in terms of job stability.