SEATTLE – Uber and Lyft drivers in Seattle are taking home a smaller share of each ride than they were three years ago, even as the highly valued companies they drive for go public, a new analysis of pay data released by a drivers organization shows.
Across about 560 Uber and Lyft trips in Seattle, the company kept a median of 31% of the fare a rider paid, up from 20% around 2013, according to the analysis. The report was compiled by the App-Based Drivers Association, a local group of drivers affiliated with Teamsters Local 117, the union that advocated in recent years for allowing ride-hailing drivers to unionize.
The companies disputed the findings, which are based on a limited sample size of self-selected drivers and rides.
Uber and Lyft have rocketed to prominence across the globe in the last decade, raising concerns about poaching rides from public transit and a business model that uses drivers who are categorized as independent contractors without the protections of traditional employees.
The analysis comes about a month after Lyft went public and before Uber's initial public offering. The drivers association analysis, as well as the companies' own filings with the Securities and Exchange Commission (SEC), "shows that the IPO payday for executives is being sold to investors on a promise of decreasing pay for workers," the report said.
The companies counter that drivers are making sufficient pay and benefiting from the flexibility of working through an app.
"Drivers are at the heart of our service — we can't succeed without them — and thousands of people come into work at Uber every day focused on how to make their experience better, on and off the road," an Uber spokesman said in a statement.
The argument that Uber and Lyft are keeping a higher portion of each ride is reflected in the companies' own documents, though the companies' numbers are more favorable to drivers than those compiled by the drivers group.
Uber wrote in a filing with the SEC that its take rate was 22% in 2018, up from 21% in 2017 and 16 % in 2016. The 2018 rate ranged from 12% to 25% by region, the company wrote.
Lyft's rate increased from about 17% in 2016 to about 29% at the end of 2018, but includes the company's rentable bikes and scooters, according to its SEC filing.
In the "risk factors" section of its filing, Uber identifies lower driver pay as a possible liability.
"While we aim to provide an earnings opportunity comparable to that available in retail, wholesale, or restaurant services or other similar work, we continue to experience dissatisfaction with our platform from a significant number of Drivers," the filing reads. "In particular, as we aim to reduce Driver incentives to improve our financial performance, we expect Driver dissatisfaction will generally increase."
An Uber spokesman pointed to another line in the company's filing: "Our platform powers opportunity for drivers, fueling the future of independent work by providing drivers with a reliable and flexible way to earn money."
The study looked at 564 standard Uber and Lyft trips completed by dozens of Seattle drivers between July and October 2018. The union would not specify how many drivers participated other than to say "dozens."
Walter Ellis, who has driven on and off for Uber and Lyft since 2015, said pay on the apps has been shrouded in "a big cloud of mystery." The companies' take rates have ranged from 20% to 35%, he said.
The Seattle City Council has indicated it could soon pursue a new strategy for addressing driver pay: setting minimum rates for base fare.
