University of California study reveals key findings about work conditions of TNC drivers

A study led by labour economist Michael Reich from University of California, Berkeley, provides a comprehensive understanding about key issues involving transportation network company drivers in California. Data has shown that Uber and Lyft’s drivers are paid less than minimum wage in California. The main reason for this is related to both companies’ business models; this includes maintaining an excess number of drivers to the number of required rides, resulting in long waiting times between rides and therefore an inefficient use of drivers. Moreover, employment status would increase a driver’s wage by 30%. These gains include higher net hourly wages, unemployment insurance, and fully reimbursed expenses during all hours worked (petrol). However, fares would increase between 5% and 10% due to drivers’ employment status. Ultimately, the study points out that total company revenue and commissions would be higher with a change in drivers’ employment status because the decrease in the number of fares would be of lesser impact than the increase in fares according to economic projections. Most full-time drivers depend on their earnings from driving as their main source of income for their families.