Global Drivers’ Strike Shows Tide May Be Shifting for Uber and Lyft
Drivers and supporters protest against Uber and other ride-hailing companies near the Wall Street Charging Bull on May 8, 2019 in New York City.
Photo: Drew Angerer/Getty Images
From 7 a.m. to 9 a.m. on Wednesday, Uber, Lyft, Juno, and Via drivers went on strike in New York City. Their work stoppage was one of several that took place in major cities around the world. In a press release, members of the New York Taxi Workers Alliance complained of low pay and worsening work conditions. Syed Ali, identified by NYTWA as an Uber driver, said he’s striking because the company “has broken their promises to drivers time and again.” At first, he added, working for Uber had seemed like a promising gig. “But then Uber cut our rates and they tried to tell us we’d be earning more even though they paid us less. What kind of craziness is that?”
There’s data to back up the drivers’ claims. Last year, analysis from the JP Morgan Chase Institute found that drivers for Uber and Lyft make “less than half of what they did four years ago.” That decline may be attributable in part to a decline in the number of hours drivers work, but Uber has also reduced per-mile pay rates for drivers. As Vox reported in March, the company cut rates by 25 percent in Los Angeles County and certain areas of Orange County; at the time, drivers picketed the company’s offices in LA.
Wednesday’s global strike shows the mettle of an emerging labor movement. Gig workers are organizing, and as Noah Smith noted at Bloomberg, the latest rideshare strikes coincide with an overall increase in the number of American workers involved in work stoppages. While this certainly isn’t the first time drivers have voiced their dissatisfaction, with both Lyft and Uber going public this spring and a vast field of Democratic presidential candidates touting their labor bona fides, the demonstrations are drawing new scrutiny.
Lee Carter is intimately familiar with both the drivers’ grievances, and the political issues they raise. A Democratic lawmaker who represents Virginia’s 50th District in the state House of Delegates, he told New York that he began driving for Lyft a month and a half ago to compensate for the low pay. (Members of the House of Delegates receive $17,640 a year for their service in the state’s part-time legislature.) “The important thing to remember about rideshare platforms versus traditional taxis is that ride sharing platforms really put all of the risk and all of the upfront costs onto the drivers. So it’s our cars, our gas. It’s our insurance,” he said. “And we’ve got people that are becoming billionaires overnight off of these ideas that have never driven a single mile with a passenger. And that’s because of the hard work of drivers.”
Carter, who participated in Wednesday’s strike, said he usually drives late at night, when he’s finished with tasks for his re-election campaign. “For a lot of people, it’s not extra money on the side,” he noted. “For a lot of people, it’s their primary job, driving for these rideshare companies. They’re doing it for 50, 60 hours a week.”
Some drivers have to work even longer than that to make ends meet. The Guardian reported on Tuesday that some Uber drivers in San Francisco have begun sleeping in their cars; high rents have pushed them out of the city and forced them into longer commutes, and they must keep hectic work schedules to make ends meet. “To make a living and survive in San Francisco, we have to drive 70 or 80 hours per week,” one driver, Sultan Arifi, told the news outlet. “Living expenses keep going up, and Uber keeps decreasing how much they pay drivers.”
When you pull up your app and call an Uber, a full third of the fee you pay goes to Uber and not to your driver, the left-leaning Economic Policy Institute reported in 2018. Once Uber takes its cut, driver compensation averages around $11.77 an hour – but from there, the sum continues to shrink. Take out Social Security and Medicare taxes, and EPI found that hourly pay is around $10.87. EPI defined that sum as discretionary income, so it’s an assumption, really, that drivers “do not provide themselves the equivalent of the health and retirement benefits or social insurance programs.” If they do, EPI estimates that they earn a real wage of $9.21 an hour.
App drivers in New York City make more, but only because the City Council passed a pay raise in 2018. As Vox noted at the time, the law closes a loophole that companies like Uber and Lyft have long been able to exploit. By classifying drivers as contractors instead of employees, companies like Uber and Lyft are able to skirt minimum wage laws. (Uber has consistently claimed that its drivers are self-employed – an argument that’s been more successful in the U.S. than it has in Europe.) Despite the pay raise, New York City drivers say they’re still struggling to make a living.
Uber and Lyft, meanwhile, are navigating delicate moments in their corporate lifespans. Uber is scheduled to begin publicly trading this week, a move that will make top shareholders very wealthy – though, as Reuters previously reported, the rideshare company admitted in its IPO filing that it may never turn a profit. Lyft faces its own struggles. On Tuesday, the New York Times reported that in its first quarter as a publicly-traded company, Lyft “posted a loss of $1.14 billion for the first quarter, compared with a loss of $234.3 million in the same period a year earlier.”
The complaints of rideshare drivers highlight both the limitations of Silicon Valley’s industry-wide conflation of innovation with progress, and the high-profile support that Uber, and other rideshare companies, have received from ostensibly liberal sources. HuffPost founder Arianna Huffington joined Uber’s board of directors in 2016, and the company is also one of many Silicon Valley corporations to draw high-profile veterans of the Obama administration. David Plouffe briefly worked for Uber. Lyft hired former Obama transportation secretary Anthony Foxx in 2018, and Valerie Jarrett, an Obama adviser, joined the company’s board in 2017. In her memoir Jarrett said that Lyft’s founders are “shrewd businessmen” who “also believe in diversity as a strength. They believe in a social conscience and a commitment to our cities.”
But Uber and Lyft may not be able to count on such a comfortable relationship with the administration of the next Democratic president – whoever they are, whenever they take office. On Wednesday, several Democratic presidential candidates expressed their solidarity with Uber and Lyft drivers.
Mother Jones reported on Wednesday that the campaigns of Andrew Yang, Eric Swalwell, Cory Booker, Tim Ryan, and Kristen Gillibrand would not cross picket lines. Uber, Lyft, Juno, and Via may not want to admit their drivers are workers, but the next occupant of the White House might disagree.