In this week’s roundup, it’s good (growth) news for Uber, beyond ridesharing and even delivery. Senior RSG contributor John Ince covers Uber for work, business loans and more on the rideshare industry below.
Uber’s push into on-demand recruitment is a natural progression for the gig economy [Venturebeat]
Sum and Substance: It had been rumored for a while, but Uber officially confirmed today that it is expanding beyond on-demand transport and into on-demand staffing for the recruitment industry.
The move represents a natural evolution both for Uber and the modern day workforce, which has pushed steadily toward temporary, part-time, and shift-based employment …
Similar to its core ride-hail service, Uber is quick to point out, Uber Works merely provides a platform for recruiters to find workers. Uber doesn’t want to be seen as the recruiter itself. Indeed, the company has partnered with staffing agencies such as TrueBlue, which take care of all the recruitment side of things — this includes managing pay and benefits. Similarly, Uber is also partnering with a number of education and training companies to “deliver services that support skill up-leveling and promote work re-entry,” according to the company, similar to what some of the Uber drivers receive.
My Take: This is a natural evolution for Uber. It provides a way for Uber to take advantage of its brand and overall presence in the gig economy. Of course only time will tell, but it looks like this is a small step in the right direction.
It looks like Uber is getting into the small loan business for its drivers [Vox]
Sum and Substance: Uber may be considering lending money directly to drivers, based on a recent survey it sent out to some of its fleet. Uber seems to be exploring the option of directly offering financial loans to its drivers.
The ride-hailing giant sent out an in-app message to some drivers this week saying it’s “building a new financial product” to help Uber drivers with their finances “in a time of need,” and asked recipients to fill out a survey.
“Have you taken out a small loan (of a dollar amount below 1,000 USD) in the past 3 years?” reads one of four questions. Another asks: “If Uber provided loans, what amount are you most likely to request?” (The options to answer range in brackets of “Less than $100,” “Between $100 and $250,” “Between $250 and $500,” and “More than $500.”)
Uber offering financial services isn’t exactly new — the company piloted an interest-free cash advance program for drivers in California and Michigan back in 2016. It also currently offers a co-branded credit card with Visa and an Uber Cash digital wallet for riders, and helps lease cars to drivers through third-party partnerships.
My Take: It’s early on this so let’s not jump to any conclusions. But it looks like Uber is going down the path of least resistance. They’ve got a lot of drivers who are in need of loans and they’ve got money to lend. Why not?
Uber drivers are not entrepreneurs – NLRB General Counsel ignores the realities of driving for Uber [Economic Policy Institute]
Sum and Substance: An April 29 advice memo issued by the National Labor Relations Board’s Office of the General Counsel (NLRB GC), arguing that Uber drivers should be classified as independent contractors, is defective. It overstates the realities of Uber drivers’ “entrepreneurial freedom,” understates Uber’s control over its drivers, and discounts relevant analysis related to how Uber drivers are paid. It is only through cherry-picking facts and ascribing outsized weight to some factors that the GC reaches its erroneous conclusion. In reality, Uber drivers do not have the opportunities and autonomy that small business owners have:
- Uber drivers—who earn about $9–$10 an hour—can’t expand revenues because they can’t control prices or expand their customer base—the only thing they can do is drive more hours.
- Any boost in earnings as Uber drivers get more experience is minimal and stalls out after about two years. (According to research coauthored by Uber’s chief economist, a driver with roughly two years of experience earns about 9% more than a novice driver with about three months of experience, and driving for an additional two years provides only a 1–2% further earnings bump. The earnings growth over the first two years is only minimally different from that of other workers.)
- Uber drivers are not able to choose their customers: drivers can’t pick their riders (they are penalized for rejecting trips).
My Take: This is a very legalistic view on the matter. It spins it out in great detail. For those who want to spend the time reading it, it’s there. It’s a critical issue in light of AB5 being signed by the California governor.
Uber’s new offerings don’t measure up to its challenges [CNN]
Sum and Substance: On Thursday, a procession of Uber (UBER) executives presented new features — and one celebrity chef partnership — that the company hopes will delight customers, much in the same vein as events held by tech giants like Apple (AAPL) and Google (GOOGL). Uber CEO Dara Khosrowshahi even trotted out a new favorite slogan for the company. Uber, he said, wants to be the “operating system for everyday life.”
But the actual announcements at the event may be too incremental to turn around a company facing a long and daunting list of problems, including record losses, multiple rounds of layoffs, continued scrutiny over passenger safety, potentially existential regulatory threats and a stock price that is hovering near an all-time low.
My Take: Uber seems to be following major companies like Apple and Google here. But don’t be taken in. It’s basically a small amount of innovation and a lot of problems.
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Uber reportedly tests audio recording feature that lets you report your driver [USA Today]
Sum and Substance: Uber may be testing a feature that would let passengers who felt unsafe record their driver’s voice and report the incident to the company.
Jane Manchun Wong, who reverse engineers apps, tweeted Monday that Uber is testing a tool called “Record Audio” for people “uncomfortable with the ride.” Wong was one of the first to discover that Instagram tested hiding likes months back.
…Uber representatives weren’t immediately available for comment.
In September,Uber rolled out RideCheck, a system designed to flag unusual events such as long stops or car crashes to keep passengers and drivers safe – an action taken after several high-profile assault scandals.
Over the past two years, the company has bolstered efforts to make riders feel safer after dealing with a murder case and sexual assault complaints against drivers.
My Take: This is an interesting development. It looks like it’s still in the early stages of introduction but let us know if you see it in your (passenger) app!
Readers, what do you think of this week’s round up?
-John @ RSG
