Lump a bunch of MIT researchers into an Uber and they’ll come out with a thesis. In this case, a new study titled The Economics of Ride-Hailing: Driver Revenue, Expenses and Taxes.
- Drivers for Uber and Lyft make a median hourly profit of $3.37
- 74% of drivers earn less than minimum wage
- 30% of drivers lose money every mile
Who (or what’s) to blame? Gig-economy business models that saddle employees with fixed costs (e.g. cars), while shrinking earnings due to industry competition.
But Uber said we’ve got some numbers of our own: Two studies from 2015 and 2017 give average hourly profits of $19.04 and $21.07, respectively. In a weekend post on Medium, it also convincingly pointed out how MIT’s methodology was flawed.
Then there was this…
MIT’s lead author shouldered the criticism and agreed to take another look. For now, we’re still left wondering: is it better to have a minimum wage job or “be your own boss” in the gig economy.
This article provided by Morning Brew – your daily fix for everything business, from Silicon Valley to Wall Street. Click *here* to sign up for the daily e-newsletter that cuts through the bs and gives you a quick and conversational round up of all things business every morning. Original article: https://www.morningbrew.com/stories/controversial-mit-study-points-low-wages-ride-hailers/