- Uber and Lyft recently reported growing revenue figures backed by high rider demand.
- But many of the companies' drivers aren't satisfied.
Uber and Lyft recently announced they raked in record profits and brought thousands more drivers onto their platforms. However, for many drivers, earning enough to get by has become more challenging.
Over the last year, Business Insider has spoken to dozens of ride-hailing drivers about their driving experiences. Most have said that while they value the flexibility to set their own hours, earnings have declined and competition has grown.
Sergio Avedian, an Uber driver and senior contributor to the gig-driver-advocacy blog and YouTube channel The Rideshare Guy, regularly hears from ride-hailing drivers about their concerns.
He told BI that complaints come from people who drive for both Uber and Lyft but that Uber's scale has given the company an outsize impact on ride-hailing drivers. In the second quarter of this year, Uber drivers completed 2.2 billion trips across the company's ride-hailing and delivery platforms; Lyft drivers completed roughly 200 million trips.
The big ride-hailing platforms appear to be thriving. On Tuesday, Uber beat Wall Street estimates for its second-quarter earnings, reporting revenue of $10.7 billion — 16% more than a year prior. Uber CEO Dara Khosrowshahi said Uber had "record profitability" last quarter, noting that drivers and couriers earned $17.9 billion.
Lyft on Wednesday announced revenue last quarter of $1.4 billion, up 41% year-over-year, though the company missed on earnings. Last quarter, Lyft reported a record number of rides at 205 million, with the most new drivers of any quarter since 2019.
Avedian said he's skeptical about some of the drivers' complaints. For example, he said accusations that ride-hailing companies aren't giving drivers 100% of rider's tips — which the companies have promised to do — don't have sufficient evidence. However, he's confident that many other frustrations are legitimate and widespread.
Avedian shared what he considers to be the top concerns of Uber and Lyft drivers: declining pay, driver safety, and wrongful deactivations.
Low earnings and declining share of pay
Avedian said drivers have experienced a decline in earnings over the last few years. Drivers have reported being offered lower-paying rides more frequently than in past years, sometimes below $3, and have seen fewer promotions and bonuses.
"The trend has not been the driver's friend," Avedian said.
Avedian said that Uber and Lyft have also recently taken a greater share of the rider's fare. Whereas drivers used to take home about 80% of the fare, he said drivers "are lucky" if they receive 50%.
In a statement, an Uber spokesperson said that "Uber's take rate has remained largely flat over the past few years," adding that "the amount of the rider fare that goes toward local government taxes and fees, as well as commercial auto insurance, has increased significantly."
Lyft says its drivers are guaranteed to earn at least 70% of rider payments each week, after external fees like local taxes and government-mandated insurance.
"We've heard lots of feedback around consistent themes — earnings, deactivations, and safety — and we're taking action to address them," David Risher, Lyft's CEO, said in a statement provided to BI.
Though the companies refute some of the findings, a UC Berkeley study from May found that many gig drivers earn less than their area's minimum wage after accounting for expenses.
An Uber spokesperson told BI that drivers, on average, make more than $30 an hour while active in the app. In February, Lyft said the typical US driver who used a personal vehicle earned about $31 per engaged hour — and $23 an hour after accounting for expenses like gas and maintenance. However, many drivers have told BI has spoken to said they earn less than this.
George, a full-time Uber driver in Cleveland who has driven since 2017, said he wants to quit but has few other options. He made $109,000 in driver earnings last year but only took home $17,000 after Uber's commission, gas, and maintenance fees. He said he has to work nearly double the hours to make the same amount in a week he made last year.
Drivers have also reported lower or more inconsistent tips over the past year, with UC Berkeley finding that customers were three times as likely to tip delivery drivers as rideshare drivers. Uber previously told BI that tipping frequency and average tip size have both roughly doubled over the last four years.
Some drivers worry about their safety
Avedian said many drivers also have concerns about their safety.
"Not a day goes by that we don't hear about carjacking of Uber or Lyft drivers or, unfortunately, physical assaults," he said.
Julie, a part-time Uber driver in Cleveland, hasn't always felt safe during her five years in the gig economy, she previously told BI. Some riders have threatened her, damaged her vehicle, or encouraged her to speed. Due to her safety concerns, Julie said she only drives during the daytime.
One of her worst experiences came when a customer who appeared to be unwell rolled down the windows and yelled that he was being kidnapped.
"He kept telling me he killed many people," said Julie, who asked to use a pseudonym and spoke on condition of anonymity for fear of professional repercussions. "I reported it to Uber, and nothing was done."
An Uber spokesperson said that the company has in-app safety features that show its commitment to safety, including an emergency button, an audio recording feature, the ability to chat with a live safety agent, and its RideCheck system, which can detect if something unexpected occurs on a trip like a crash. They said the company has piloted a new rider verification program that will help confirm riders who they say they are and a Record My Ride feature that turns a driver's phone into a dashcam.
A Lyft spokesperson told BI that the company has an around-the-clock safety response team that can be contacted via phone or chat, a trauma-informed care team with specialized training, and a location-sharing option drivers can use to ensure loved ones know where they are.
Drivers worry about being wrongly deactivated — and don't receive enough support
Avedian believes many drivers have been wrongly deactivated from the Uber platform. When drivers try to contact Uber to discuss their deactivations or other issues, he said the company's driver support system and agents are often unhelpful.
Drivers can be deactivated for various reasons, including a low platform rating, a failed background check, an expired license, and customer accusations of safety issues. However, Avedian said drivers are sometimes deactivated due to "fraudulent rider claims."
Aaron Lavender, an Uber and Lyft driver in Colorado, previously told BI he was deactivated from the Uber app for three days after a customer filed a complaint saying that his appearance and smell made them suspect he was intoxicated. Lavender said he was eventually cleared by Uber following a brief investigation and had his account reactivated.
"Stories of permanent deactivation do scare me and make me not want to rely solely on this job," he said.
Some drivers have a harder time getting their deactivations reversed. An Uber Eats driver in Oregon was making a delivery when the customer changed the dropoff location, he previously told BI. The new destination turned a 10-minute trip into a one-hour one, so he contacted Uber Eats support to try to cancel the order.
He said the support agent approved the cancellation, but a few days later, his account was deactivated.
"All of a sudden, it says my account is under investigation for fraud," he said. "It just says 'fraud.' It doesn't give any details."
After two months of exchanging messages with agents, he said his account was eventually reactivated.
An Uber spokesperson told BI that last year, the company announced major changes to its deactivation process to make it more fair to drivers. This includes giving them a "clear process to appeal a deactivation and protecting them from false allegations and unfair ratings."
The spokesperson said that drivers have a dedicated support team. For safety-related issues, there is a 24/7 Safety Incident Reporting line. The company also has 24/7 customer support available through the Uber app to "get users answers to common questions and resolve issues as quickly as possible."
A Lyft spokesperson told BI that the company rolled out an in-app button earlier this year that allows drivers to appeal deactivation decisions. They said that drivers are hearing back about their deactivation decisions faster than they were a year ago — about 10 hours faster on average.
Additionally, Lyft offers 24/7 support for drivers, offers phone and chat options in Spanish, and has invested in translation services for Spanish, French, and Portuguese-speaking drivers.
Are you a gig driver who is struggling to make ends meet? Reach out to these reporters at jzinkula@businessinsider.com or nsheidlower@businessinsider.com.