Thursday, September 15, 2016

An Analysis of the Labor Market for Uber’s Driver-Partners in the United States

Jonathan Hall, Uber's chief economist, has argued that Uber has limited ability to change the hourly income of its drivers because higher prices just attracted more drivers, who then spend more time waiting or driving idle. He says the equilibrium is when their Uber earnings roughly equal what they could earn elsewhere.

But what do we know about typical Uber driver earnings? Here is a paper by Jonathan Hall and Alan Krueger on the labor market for Uber drivers

"This paper provides the first comprehensive analysis of Uber’s driver-partners, based on both survey data and anonymized, aggregated administrative data. Uber has grown at an exponential rate over the last few years, and drivers who partner with Uber appear to be attracted to the platform in large part because of the flexibility it offers, the level of compensation, and the fact that earnings per hour do not vary much with hours worked, which facilitates part-time and variable hours. Uber’s driver-partners are more similar in terms of their age and education to the general workforce than to taxi drivers and chauffeurs. Uber may serve as a bridge for many seeking other employment opportunities, and it may attract well-qualified individuals because, with Uber’s star rating system, driver-partners’ reputations are explicitly shared with potential customers."

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