Considering vehicle expenses, Uber drivers make a lower salary


Half of Uber drivers are actually making less than $10 an hour, study shows

Vehicle expenses eat into an Uber driver's wages.


Christina Bonnington


Posted on Oct 3, 2018   Updated on May 21, 2021, 5:02 am CDT

When you take into account overall vehicle expenses, Uber drivers may not make as much as advertised, a recent study suggests.

Data collected by Ridester found that including tip, Uber drivers make a median rate of $14.73 per hour. However, when you take into account vehicle expenses on top of that, the hourly wage drops to approximately $9.73 per hour for more than half of those drivers. Considering things such as gas, insurance costs, and car depreciation, Ridester estimated (at the low end) that drivers were losing out on $5 per hour from their gross earnings.

While the exact average varies, other studies have also concluded that Uber’s driver earnings estimates skew high. The Economic Policy Institute also found that most Uber drivers end up making closer to $10 an hour after vehicle expenses and other operating costs were factored in. It found drivers averaged $11.77 an hour after commission and expenses, but only $10.87 an hour after Medicare and social security were included into wage estimates. The W-2 equivalent hourly wage would be only $9.21—right around Ridester’s more recent earnings estimate.

Other studies, such as a 2017 investigation by The Rideshare Guy, found that Uber drivers average $15.68 per hour. However, that figure doesn’t take operating and vehicle expenses into account. A Buzzfeed News investigation found that earnings vary by metropolitan area, but that in several cities, drivers were earning less than $13.25 after expenses.

With these figures, it would seem most Uber drivers are making around $31,000 annually from their gig job but making closer to $20,000 per year after expenses. Years ago, the company used to claim drivers made closer to $70 to 90,000 in earnings. The company’s website now hedges the amount drivers can make, saying “You can drive and earn as much as you want. And, the more you drive, the more you’ll make.”

These per hour wage statistics, as opposed to results on overall earnings, are not affected by the fact that a majority of Uber drivers don’t make ride-hailing their full-time job.

H/T Recode

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*First Published: Oct 3, 2018, 11:53 am CDT