Every year I send out a survey to all of my drivers here on RSG. Honestly, I’m not a big fan of filling out surveys myself, but it is a great way to get feedback from my readers and confirm trends that I’ve been seeing in the on-demand economy.
So to everyone who filled out a 2016 survey, thank you! We sent the survey out on 12/30/15 to 10,234 e-mail subscribers and got 453 responses, which is awesome, and I’ll be sending out some RSG swag to 10 lucky winners. Scroll down to the bottom to see if you were randomly selected. I’ll also be contacting you by e-mail.
This year’s survey had some really interesting results and I’m also getting better at asking interesting questions. So if you’re a company or start-up interested in going over the results with me or one of my staff members, please e-mail me.
For everyone else, hope you enjoy!
2016 Survey Results: Getting Started With Driving
According to Uber’s own numbers, half of all drivers quit after just one year. I was surprised to see that only 17.4% of my audience has only been driving for 0-3 months, which tells me that although there are a lot of new drivers out there, they aren’t finding the online resources like my site, rideshare Facebook groups and forums.
This also speaks to the challenges of organizing drivers since there are so many new drivers who really only talk to Uber and don’t know how to get in contact with their fellow workers.
A little quick math: If Uber currently has 400,000 drivers and half are quitting after one year, that means they need to replace about 17,000 drivers each month (200,000 drivers/12 months). And if they’re growing at a monthly rate of 10.6% (they announced 162,000 drivers on 1/22/15 and 400,000 drivers on 11/3/15 – active drivers are defined in both cases by having taken at least four trips in a single month), that means they need to hire 42,000 new drivers each month.
So in order to replace the drivers that are quitting AND sustain growth, Uber needs to hire about about 59,000 drivers in total every single month. Wow!
If you’re wondering where Uber finds all of those new drivers, this chart gives a good glimpse into that. I’ve talked before about Uber’s main marketing channels and although I’ve always known they pumped a lot of money into their referral program, I was surprised to see that so many people ‘heard from a friend’ about driving for Uber.
Not all of these word of mouth referrals are paid referrals, but it’s impressive to see just how important the network effect is when recruiting on the supply side. Basically by having such a large passenger base, this also helps recruiting efforts. This is also why a lot of the smaller to mid tier ‘Uber for X’ companies have such a hard time recruiting new drivers (and they don’t have as much $$ obviously).
If you’re curious about some of the ‘other’ responses you can view those here. The only major category I missed was Facebook ads, which is basically the same type of paid marketing as Google Ads.
Who’s Driving For Uber And Why?
I’ve commented many times before that most drivers prefer driving for Lyft, but they get more rides and make more money with Uber. I think these two charts prove that pretty clearly. Even though an overwhelming majority of drivers are primarily working for Uber and thus making more money with Uber, an equal number of them prefer Lyft to Uber.
Lyft is often mentioned in the same breath as Uber, but outside of a few select cities like SF and Austin (where Lyft claims 40% and 45% market share respectively), they don’t offer much in the way of passenger demand. Drivers in small to mid tier Lyft markets often wait 30 minutes+ for rides and ETAs can be as high as 20-30 minutes.
But Lyft has done a great job cultivating a special relationship with drivers. I’m not saying they’re perfect (ahem $1,000 driver bonus snafu), but when their president e-mails drivers after fare cuts to explain why Lyft had to cut fares, that says something.
Lyft has always been on the forefront of driver friendly features, but there just hasn’t been enough demand to make it a viable main option for drivers. Imagine how many more drivers would prefer Lyft over Uber if they actually made the same amount of money as they did driving for Uber!
Who’s Doing Most Of The Work?
Uber has obviously been in the news a lot about its controversial tactic of treating drivers as independent contractors instead of employees. In response to the current lawsuit they’re facing in California, even Uber’s CEO Travis Kalanick has stated that Uber is best suited as a way “to fill in the gaps”, implying that employee status would not make sense for a bulk of their drivers.
Their recently released survey confirms that 50% of drivers are driving 10 hours a week or less on average. Uber is clearly presenting driving as a secondary gig and some (Harris & Kreuger) have even called for a third class of worker since your average Uber driver doesn’t fit into the traditional employee/independent contractor boxes. But the problem with these assessments is that they don’t take into account who’s actually doing a majority of the work.
Based off the numbers collected in our survey, we calculated that 50% of drivers are working 20 hours a week or less, but they only account for a total of 24% of the actual hours worked out on the road. This is similar to the phenomenon we see with Airbnb ‘super hosts’ that bring in a majority of income for Airbnb with hotel style listings as opposed to private rooms or individual listings.
If you take the mid-point of hours worked (i.e. 5 hours for 0-10) for drivers in our survey and multiply it by the number of drivers you get a rough approximation of each group’s contribution to the total hours worked.
|Hours Per Week||# Of Drivers||% Of Total
|% Of All
You can see pretty clearly that a majority of the work is not being done by the 0-10 or even 10-20 hours per week crowd.
This poses several questions:
- Which group of drivers (part-timers who make up a larger % of the workforce but do less of the work OR full-timers who make up a smaller % of the workforce but do most of the work) should be given more weight when it comes to policy discussion?
- Should a third class of worker be created for a group of workers (0-20 hours per week) that only make up 24% of all hours worked on the platform?
- If 30+hrs/week is considered full-time, that means half of Uber’s drivers could actually be more closely associated with employee designation than the independent contractor designation based off hours worked.
Another analysis performed on Uber’s data from January of 2015 came to a similar conclusion.
Why Do Drivers Drive?
Uber touts the flexibility of driving for Uber all the time and it’s actually one of the points that I’ve always agreed with them on. I don’t think most people realize just how flexible being a driver is. I can literally turn the app on right now and get a request within 10 minutes and be making money.
Companies like Activehours (affiliate link) even allow you to cash out your Uber earnings the same day. So you could go out and drive a full day whenever you want and have the money in your bank account by that night. That’s pretty damn flexible!
Satisfaction With Driving
When Uber announced in December that their drivers were happier than ever, I was pretty skeptical. It didn’t pass the smell test for two reasons.
- Drivers are now making less than ever because of fare cuts, so even if Uber replaced their entire workforce, how could drivers who now make less money be happier?
- Uber has actually gotten less flexible over the past year since they now institute policies like guaranteed hourly earnings which require drivers to work certain times and accept certain percentages of fares. If drivers care so much about flexibility, wouldn’t less flexibility mean less happiness?
Uber’s survey actually found that 81% of polled drivers said they were satisfied with the overall experience of driving for Uber — up from 78% the previous year. Uber polled an unknown number of drivers (and received 833 responses) from 24 of Uber’s largest markets including Los Angeles, San Francisco, Chicago and New York City.
My survey was sent to 10,234 drivers and of the 453 driver responses, only 48.4% of drivers somewhat agreed or strongly agreed (my top markets also included Los Angeles, San Francisco, Chicago and New York City). So I think my skepticism of Uber’s survey was valid. I’d be curious to know exactly how Uber picked it’s sample size for this survey and what questions they asked (both of which were withheld from me at least).
Thanks to everyone who participated, here are the winners:
Drivers, what do you think about the 2016 survey results and what stood out the most to you as a driver?
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-Harry @ RSG