okay so I was looking at this graph that
was put on Uber's website today
[Applause]
and I thought it looked too good to be
true how amazing that Uber drivers make
more money than any other type of
Transportation driver but I knew from my
own experiences as a rider that Uber
didn't cost that much so it seemed weird
that Uber was really cheap as a
passenger but yet Uber drivers make so
much money how does that work well we
did some math to find out the facts that
Uber doesn't want you to know
so here's the sad truth about the type
of driver that is on the road for Uber
right now this is an image from Uber of
the rates that drivers make in La 90
cents per mile now Uber has cut paid to
drivers in Detroit all the way down to
24 cents a mile but we're going to stick
to the 90 cents La example for now so I
wanted to calculate how much Uber
drivers actually get to keep out of that
90 cents per mile let's have a look so
first of all Uber takes 25 of the cut
for new drivers drivers that sign on to
drive for Uber from Q3 2015. so now
we're down to 67.5 cents per mile then
you have to deduct tax because Uber
doesn't withhold tax on your behalf so
in some La counties sales tax is as high
as 10 percent and since Uber doesn't
withhold taxes for you the drivers are
responsible for keeping this money aside
to pay the tax department come April so
with the 10 deducted we're now down to
just over 60 cents
now we need to factor in depreciation of
a car so a car is an asset like anything
else and will eventually wear out and
you'll have to buy a new one every mile
you drive decreases the value of your
car and brings you that much closer to
needing a new one this is a big problem
if you drive for a living you're going
to need to buy a new car every two or
three years and the cost of a new car is
pretty significant the IRS estimates
that the cost to drive a vehicle for
work purposes is 54 cents per mile and
this is broken down into fuel cost at an
average of 12 cents per mile
depreciation at 24 cents per mile repair
tires and maintenance comes around to
about nine cents per mile an insurance
license registration Finance fees all
that stuff averages out to about another
nine cents per mile so with the 54 cents
depreciation repairs and fuel accounted
for we're now down to just over six
cents per mile that actually goes into
the hands of an Uber driver
now given that Uber also asks its
drivers to pay for things like bottles
of water and gum and phone charges for
its passengers we can say for certain
that driving for Uber pays well below
minimum wage or even worse costs drivers
money as is seen directly in this actual
fare that Uber charged one of its
drivers so given that the math is so bad
why would anyone want to drive for Uber
so here's an example of a post an Uber
driver put on Facebook he was 400 behind
in the rent and he needed to make that
money up really quickly and in a way
Uber is kind of like a loan scheme this
driver gets 400 in his hand but he
doesn't realize that come tax time he's
going to need to give some of it to the
tax man and he hasn't factored in fuel
costs or the cost for repairs or the
costs for buying a new car in the future
this is exactly the type of driver that
Uber wants they're desperate for cash
and they don't know enough about how
Uber Works to set aside some money for
taxes and vehicle expenses for these
sort of drivers Uber might be a good
deal they get cash in hand today and
sure you're going to need to pay some of
that back in taxes and car costs but you
get immediate cash to solve your
immediate needs so who cares so for some
people in Desperate circumstances that's
six cents a mile that Uber is offering
might be an acceptable deal but for most
people driving for Uber is a waste of
time I wish Uber would be more honest
with people by our calculations the
amount you're making an hour driving as
an Uber driver is nowhere near 19 per
hour if you drive 30 miles per hour at
6.75 cents per mile you're only making
two dollars per hour by far the worst
choice of any transportation job and
this number is not just my math that's
also supported by the site not cool uber
who have tracked hourly earnings to
around
2.89 per hour and after vehicle fees are
taken into account that number is around
zero now I I'm not against carpooling
Services we all need transport and I
know that I'm a frequent user of uber
and Lyft but I think Uber is going about
it in an unethical way which makes me
unethical for supporting them as a
customer Uber could easily fix this
situation by reducing their commission
or by making rates more reasonable or by
giving Riders the option to tip their
drivers like we do in Hospitality or
just by being more transparent but that
would mean admitting that they've
generated significant revenue from
effectively exploiting their drivers so
the truth is Uber benefits from
maintaining this status quo it was
currently reported to be making 10
billion dollars a year in revenue and
that money has to come from someone just
don't let that someone be you but what
do you think are you an Uber driver an
Uber passenger what's your opinion have
you got horror stories of your very own
let us know in the comments below we'd
love to hear from you
hi everyone I'm Jade Lovell resident
science nerd on The Young Turks Network
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