A significant number of Uber drivers have reported earning “considerably less” per hour since the introduction of the “dynamic pricing” algorithm by the ride-hailing app in 2023.
This conclusion emerged from a study released on Thursday by researchers at Oxford University, who examined data from 258 Uber drivers across the UK, accounting for 1.5 million trips.
Following a 20% reduction in fixed fare cuts in the UK, Uber launched dynamic pricing in 2023. This algorithm varies passenger ride prices and fare payments in numerous ways, evolving from Uber’s previous “surge pricing” model that raised prices during peak demand.
Researchers discovered that Uber currently claims a fare reduction of 29% or “acquisition rate,” which in some cases has exceeded 50%.
The union criticized this initiative, stating in 2023 that it lacked transparency and could degrade working conditions by profiling drivers based on their acceptance of lower fares.
According to the Oxford survey, “With the introduction of dynamic pricing, Uber riders now face higher fares, yet drivers do not benefit.”
The research was conducted in partnership with the non-profit gig worker organization, Worker Information Exchange (WIE). “Our results indicate that many aspects of Uber driver employment have worsened following the dynamic pricing rollout.”
The median take rate per driver has risen from 25% to 29%, with some trips exceeding 50%. Additionally, these higher take rates are predominantly observed among higher-income brackets. On average, many drivers are making significantly less per hour from their labor.
These findings come amidst various controversies involving tech companies, including a pivotal 2021 UK Supreme Court ruling affirming that Uber drivers are entitled to minimum wage and paid leave.
After the Uber Files were published, Jill Hazelbaker, Uber’s Vice President of Public Relations, stated:
The Oxford research also noted that the average hourly wage for a driver stands at £29.46. However, this drops to £15.98 when factoring in wait times, as defined by Uber, or the moments drivers are available for passenger pickups. Neither of these averages accounts for vehicle upkeep, insurance, fuel, or other expenses.
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Uber responded, stating it “does not recognize the figures in this report,” emphasizing that “all drivers are assured a minimum national living wage.”
One participant in the survey remarked, “It feels like Uber is taking away our clients and opportunities.”
An Uber representative affirmed, “UBU drivers garnered more than £1 billion in earnings from January to March of this year, surpassing previous years. Drivers have the freedom to choose to drive with Uber.”
“Every driver receives a weekly earnings summary, detailing what Uber and the drivers have made from their rides. Many drivers take pride in their choice to drive for Uber, especially as passenger demand and travel continue to increase.”
Source: www.theguardian.com
