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Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

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Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#111

Post by regulation_d »

misterbishop wrote: post #41

Discussing a rideshare worker's take-home pay as "profit" really accepts the framing of the company. Yes it's technically true that each driver is an independent contractor ("Small Business Owner"), but this designation is a farce without the ability to set pricing. The take-home pay isn't profit in practice, it's wages less unreimbursed expenses.

Let’s say I’m a dry wall contractor. A general contractor comes along and offers me $20k for a job. I say “$25k?” and he says, “No, $20k.”

If I take the job I am not magically transformed into an employee of his, simply because I lacked the bargaining power to negotiate the rate.

The reason I am still a contractor is that I have absolute control over whether to agree to do that job at that price.

There are obviously lots of factors that are considered in the employee/contractor analysis. I just don’t feel that “ability to negotiate rate” is a particularly important one when “absolute ability to refuse fare” is in the picture.

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#113

Post by laborious »

tryitnow wrote: post #103
eqdw wrote: post #71

Ways in which this headline is potentially misleading: 1) Driving for Uber/Lyft/etc is not a full time job, and was not intended to be a full time job. It's a piecemeal work side job. The flexibility of working when you want, and not working when you don't want, is valuable and you don't get it for free. 2) "Profit" is not income. This is profit net of expenses. Expenses that, among other things, you can write off ag…

With regard to point (2) I'm pretty sure the $50 Turbotax package is not sufficient for business for taxpayers who are self-employed.

Turbotax has a $120 "self employed" version custom-tailored to that situation. More than $50, but still not exorbitant.

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#114

Post by aianus »

CodeWriter23 wrote: post #97
aianus wrote: post #72

Earlier quoted context omitted.

Uber has had this feature since I started driving with them in December 2016. You can only use it twice a day, however.

Ostensibly this is for use at the beginning & end of your shift to help with the “commute”. But you’ll probably be find yourself out in the sticks with a choice of waiting long periods for each local ride request (~$2-$3 keep per ride), or using the destination geofence in the middle of the shift to avoid double-digits is deadheading.

It's also great for literally carpooling on your real-job commute. You'll be online at peak times and with the destination set in the most popular directions.

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#115

Post by AlphaSite »

tom_mellior wrote: post #86
eqdw wrote: post #71

Ways in which this headline is potentially misleading: 1) Driving for Uber/Lyft/etc is not a full time job, and was not intended to be a full time job. It's a piecemeal work side job. The flexibility of working when you want, and not working when you don't want, is valuable and you don't get it for free. 2) "Profit" is not income. This is profit net of expenses. Expenses that, among other things, you can write off ag…

> Driving for Uber/Lyft/etc is not a full time job [...] They consistently report to me that they make between $40k and $55k/yr. Is this 55k from part-time Ubering, or is this 55k in total, most of which comes from their "real" full-time job and a small fraction from Ubering, or is it 55k from full-time Ubering in direct contradiction of what you said, or what?

I was talking to a guy and he said he gets around 30usd/h from full item Ubering.

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#116

Post by criddell »

calvinbhai wrote: post #48
Liquix wrote: post #18

What is the incentive to drive for one of these services at that price point? Couldn't these people make more money (and not have to replace their car in five years) flipping burgers or the like? Are drivers misled into believing they will make more? Is the cost per mile intentionally hidden from them?

Subprime leasing programs. Initially the lease looks very attractive, because you get a swanky new car, combined with bonuses and stuff that you get as a new driver. Few months in, the incentive turns into a shackle. You start realizing that incentives are dwindling and the monthly payments are eating into most of your Uber earnings, which was masked by higher new driver incentives initially. At this point, loss aver…

The last time I was in Las Vegas, we used Lyft to get around and the one driver we talked to quite a bit told us the car he was driving belonged to Lyft. I think that makes a lot more sense than using a car you own.

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#117

Post by pfortuny »

regulation_d wrote: post #111
misterbishop wrote: post #41

Discussing a rideshare worker's take-home pay as "profit" really accepts the framing of the company. Yes it's technically true that each driver is an independent contractor ("Small Business Owner"), but this designation is a farce without the ability to set pricing. The take-home pay isn't profit in practice, it's wages less unreimbursed expenses.

Let’s say I’m a dry wall contractor. A general contractor comes along and offers me $20k for a job. I say “$25k?” and he says, “No, $20k.” If I take the job I am not magically transformed into an employee of his, simply because I lacked the bargaining power to negotiate the rate. The reason I am still a contractor is that I have absolute control over whether to agree to do that job at that price. There are obviously…

MMmmmh, but you do not lose your job as a dry wall contractor. You lose your “uber driver” job if you do not accept uber’s fares.

What am I missing?

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#118

Post by regulation_d »

pfortuny wrote: post #117
regulation_d wrote: post #111

Earlier quoted context omitted.

Let’s say I’m a dry wall contractor. A general contractor comes along and offers me $20k for a job. I say “$25k?” and he says, “No, $20k.” If I take the job I am not magically transformed into an employee of his, simply because I lacked the bargaining power to negotiate the rate. The reason I am still a contractor is that I have absolute control over whether to agree to do that job at that price. There are obviously…

MMmmmh, but you do not lose your job as a dry wall contractor. You lose your “uber driver” job if you do not accept uber’s fares. What am I missing?

As someone who hasn’t driven for Uber, I’m not sure what that looks like. What are the conditions under which you would lose you “uber driver” job?

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#119

Post by theli0nheart »

jly wrote: post #105
regulation_d wrote: post #80

Earlier quoted context omitted.

Can’t this be avoided by being taxed as an S-corp?

No. An individual who is the sole director, sole shareholder, and provides all of the services in an S-Corp will have any distributions classified as compensation subject to payroll taxes. There is a lot of established law on this subject.

This is false. Any income in an S-corp that isn't paid via wages is not subject to FICA and Medicare, regardless of number of shareholders. That's a big reason why so many LLCs choose to classify themselves as S-corps. There are (or were, at least, before the latest tax bill) significant tax benefits to doing so.

It doesn't matter how many shareholders there are, since an S-corp is not a disregarded entity, like a single-member LLC.

From https://en.wikipedia.org/wiki/S_corporation#FICA:

> As is the case for any other corporation, the FICA tax is imposed only with respect to employee wages and not on distributive shares of shareholders. Although FICA tax is not owed on distributive shares, the IRS and equivalent state revenue agencies may recategorize distributions paid to shareholder-employees as wages if shareholder-employees are not paid a reasonable wage for the services they perform in their positions within the company.

If you have data to support the contrary, please post your sources.

Re: Uber, Lyft Drivers Earning a Median Profit of $3.37 per Hour, Study Says

#120

Post by Brakenshire »

derekp7 wrote: post #33

The problem isn't the profit, but that there are a number of people using this as one of their primary income sources. I'm not sure how Uber et. al was originally promoted to drivers, but I've originally seen it as something like "I'm heading home from work, let me turn on my uber app and see if anyone around me needs a ride going in that direction". Or, "I feel like riding around tonight, no particular place to go,…

Is that realistic given the extra insurance costs associated with using your vehicle as a private hire car? You'd have to do a lot of this just to recoup that cost.
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