Skip to Content

This Is How Uber Has Shaped the Taxi Labor Market

Ride-hailing hasn’t eroded the number of taxi driver jobs, but it has made them pay less.
January 27, 2017

Ride-hailing services like Uber and Lyft have changed the way we get around cities—but how have they changed the employment situation for drivers? A study by University of Oxford researchers confirms some predictable impacts, but also provides a few surprises.

The research considers data from the U.S. Bureau of Labor Statistics between 2009 to 2015, allowing it to investigate what happened to the driver labor force during the arrival of Uber in a number of American cities, including New York, Los Angeles, and San Francisco. 

When Uber rolled out in a city, the number of self-employed drivers rose on average by around 50 percent, which makes sense. But the number of traditional wage-paid taxi driver jobs didn't decrease when Uber arrived. In fact, there was a small increase in regularly employed taxi drivers.

That doesn’t mean that Uber’s presence isn’t felt. The analysis also shows that the average hourly earnings of waged taxi drivers have fallen by around 10 percent in cities where Uber is active. Meanwhile, self-employed drivers have enjoyed a 10 percent rise.

“The spread of Uber has increased competition in taxi services, contributing to lower overall incomes for taxi drivers, and a redistribution of income from payroll taxi services to self-employed drivers,” explains Carl Benedikt Frey, one of the paper’s co-authors.

The higher hourly rate for self-employed drivers is likely due to the technological advantages provided by Uber. The company’s app streamlines the process of matching cars with drivers, so despite being paid only on a per-ride basis, drivers can achieve a higher utilization of their time.

Not that Uber drivers are necessarily happy with their earnings. Earlier this month, Uber announced that it will pay $20 million to settle a lawsuit with the FTC—because it promised unrealistic earning potential.

(Read more: Drivers of Disruption?, Vice, “Uber and Lyft Are Still Trying to Avoid Acting Like Regular Employers”)

Keep Reading

Most Popular

open sourcing language models concept
open sourcing language models concept

Meta has built a massive new language AI—and it’s giving it away for free

Facebook’s parent company is inviting researchers to pore over and pick apart the flaws in its version of GPT-3

transplant surgery
transplant surgery

The gene-edited pig heart given to a dying patient was infected with a pig virus

The first transplant of a genetically-modified pig heart into a human may have ended prematurely because of a well-known—and avoidable—risk.

Muhammad bin Salman funds anti-aging research
Muhammad bin Salman funds anti-aging research

Saudi Arabia plans to spend $1 billion a year discovering treatments to slow aging

The oil kingdom fears that its population is aging at an accelerated rate and hopes to test drugs to reverse the problem. First up might be the diabetes drug metformin.

Yann LeCun
Yann LeCun

Yann LeCun has a bold new vision for the future of AI

One of the godfathers of deep learning pulls together old ideas to sketch out a fresh path for AI, but raises as many questions as he answers.

Stay connected

Illustration by Rose WongIllustration by Rose Wong

Get the latest updates from
MIT Technology Review

Discover special offers, top stories, upcoming events, and more.

Thank you for submitting your email!

Explore more newsletters

It looks like something went wrong.

We’re having trouble saving your preferences. Try refreshing this page and updating them one more time. If you continue to get this message, reach out to us at customer-service@technologyreview.com with a list of newsletters you’d like to receive.