Drive for Uber & Zipcar Make less than Minimum Wage
Drivers that take advantage of a new Uber “opportunity” in Boston would make more money flipping burgers at McDonald’s.
Uber drivers that rent vehicles through Zipcar in Boston would make $8 an hour, Quartz estimated. The minimum wage in Massachusetts is $11 an hour; so the gig economy worker would presumably earn more under the Golden Arches.
Zipcar, a service offered by Avis Budget Group (NYSE: CAR), rents cars for $12 an hour, Quartz writer Alison Griswold estimated. The average Uber driver in Boston makes around $20 an hour.
Note: there are some “benefits” to not working at McDonalds such as: no hot grease, no ugly uniforms, no standing on your feet all day, no high-school dropout manager breathing down your neck, fewer rude customers and fewer repetitive tasks. Many Uber drivers (and some fast-food workers) might consider losing those benefits of Mickey D’s employment well worth a $3 an hour pay cut.
Uber and Avis Team Up
Uber and Avis-Budget are currently testing a service that allows people to rent one of 10 different cars parked around Boston for Uber use. Zipcar is a short-term rental service that gives customers access to vehicles parked on streets in various cities.
There are some other fees that Uber Zipcar entrepreneurs in Boston might have to deal with, Griswold noted. These include a $50 an hour late fee, a $30 fee for returning a vehicle with less than a quarter a tank of gas.
Insurance might also be a problem because Zipcar’s coverage comes with a $2,000 deductible paid by the driver. Note: Uber might take care of this by having the driver get ride-sharing driver insurance from a company like GEICO or Allstate.
One thing is certain Uber’s latest service is a very questionable deal for drivers. The ride-sharing service is going to have to find a way to increase drivers’ income if it wants such deals to succeed.
Politicians and public policy planners need to take a look at this too. It appears that many of the new “opportunities” presented by the gig economy may not be that lucrative. It also makes a very strong case for the creation of some sort of basic income scheme for such workers.