Although the federal minimum wage is currently set at $7.25 per hour, it may be true that some Uber drivers aren’t making minimum wage in accordance with their own local mandates. That’s according to a new report from MarketWatch, which states that the company’s workers likely bring home an average of $9.21 per hour. For areas of the U.S. that follow federal minimum wage laws, that doesn’t necessarily seem like a terrible paycheck. However, as of 2017, as many as 29 states have minimum wages set higher than the federal minimum. In some areas, such as the District of Columbia (D.C.), the minimum wage is actually higher than the average brought home by the tech-based company’s contracted workers. For D.C., the minimum is $11.50 per hour, while in Washington and Massachusetts, the minimum wage is set at $11.00.
Breaking down the numbers, Uber drivers actually start out at around $24.77 per hour from passengers but Uber takes $8.33 of that right from the start. The drivers are also responsible for many of their own expenses. Gas and maintenance costs drivers around $4.87 per hour, while taxes for Social Security and Medicare remove a further $0.90 per hour. Uber drivers are self-employed, so they pay their own taxes, but that’s actually after consideration for tax deductions afforded by the position. They also aren’t required to pay their own commercial insurance. However, that leaves them without health insurance or a retirement plan at $10.87 per hour. Paying for those leaves drivers at $9.21 per hour. Meanwhile, there are approximately 833,000 drivers working for Uber at a given time but, due to a high turnover rate, only around 90,521 of those are working full-time. The majority of workers are averaging around 3 months of work at 17 hours per week.
Of course, it’s important to note that the figures often depend on how much work there is to be had in a given area. So in areas such as New York, Uber drivers averaged around $25 per hour as reported by Uber back in 2014. Other independent reports on the matter for Colorado, conversely, put the number at below even federal minimums at $7 per hour. It’s also important to bear in mind that Uber driving is often seen as a part-time job to supplement another form of employment. That doesn’t necessarily make sub-minimum wage earnings acceptable or less annoying but, taken with everything else, it does seem to balance things out for the most part. At the very least, it’s an issue that seems to pale in comparison to others faced by the company, but it may be something to bear in mind when considering whether to tip one’s driver.