Many drivers are currently asking themselves tough questions: get on the road again and drive, stay at home and continue collecting unemployment, try another gig job like food delivery? Unfortunately, more drivers may have to think about getting back to some form of work, especially as unemployment funding dwindles with little hope of more stimulus funding.
Senior RSG contributor Jay Cradeur assumes the worst: what happens when government funding runs out for independent contractors? Here’s what you need to know and consider.
Let’s assume the worst. Let’s assume the $600 bonus many of us are receiving in addition to the regular weekly unemployment stipend will stop on the week ending July 25.
That’s only 4 weeks away. Will you stay at home? Will you drive for Uber and Lyft? Will you drive for a food delivery company? Here are your options and things to know.
If you are considering driving for delivery, we recommend signing up for Postmates now. Postmates is offering huge bonuses in many cities, and now is your chance to get those incentives!
Background: Where Are We Now?
The day is coming to make a decision. Some drivers are already driving. Most are not. The virus is again raging through our country. That makes driving more dangerous for us – especially older drivers.
This Centers for Disease Control and Prevention (CDC) graph shows how America is doing with the pandemic. We are not doing well.
Instead of being on the downside of the first wave, we have been riding a plateau and are now ascending again. This last week we saw our worst day ever in new Covid19 cases.
Not only is the situation more dangerous for drivers, but it will also reduce demand as the need to slow down “openings” becomes necessary in hot spots around the country.
Current Status of Government Benefits
Many drivers got the Economic Injury Disaster Loan (EIDL) $1,000 grant. Many got the $1,200 stimulus check. A few received the Paycheck Protection Program (PPP) forgivable loan. And the great majority applied for unemployment benefits through the Pandemic Unemployment Assistance (PUA) program.
Take a look at our latest YouTube unemployment funds update video here, and make sure to subscribe to our YouTube channel – that’s where you’ll find the latest unemployment news!
Approximately 2/3 of us are getting the funds. The other ⅓ are wading through bureaucracy in hope of getting payments into their bank account ASAP.
Included with that program is the Federal Pandemic Unemployment Compensation (FPUC), which is the bonus $600 per week scheduled to stop in four weeks. What happens if those benefits are not extended?
According to this quote in Forbes magazine below, it could be catastrophic for those relying on these benefits – akin to ‘delivering a 50-75% pay cut overnight to a huge chunk of the American population.’
What Are Your Options if Funding is Cut Off or Curtailed?
1. Do Food Delivery
Instead, you drive to a restaurant or grocery store, pick up the food, drive to the destination and drop it off. Although admittedly, Instacart is a bit more work since you often have to do the shopping too (and potentially more dangerous Covid-wise).
Uber Eats drivers we’ve interviewed have mentioned delivery has been ‘the best ever’, so make sure to check out our article on how to stay safe while driving for Uber Eats.
On Harry’s recent Youtube Live, several commenters remarked how they were earning $20-30 per hour on Uber Eats – normally, the payouts range closer to $10-15 per hour.
If you’re not sure which food delivery company is best for you, check out our article on Best Food Delivery Apps to Work for. Our top recommendations are:
- Best Paying Delivery App: DoorDash or Postmates
- Best Grocery Delivery App: Instacart
- Best ‘Stuff’ Delivery App: Postmates
If you’re on the fence about driving for delivery, consider signing up for Postmates now and giving it a try. Postmates is offering drivers in most cities big bonuses – it’s like the old days of Uber and Lyft, so you might as well sign up and get these incentives while they last!
2. Drive For Uber and Lyft
While delivering food seems safer, the more I think about it, the more I feel driving for Uber and Lyft sounds safe and certainly more enjoyable.
With food delivery, you have to get out of your car, walk into a restaurant, wait, handle packages, and then deliver.
With rideshare driving, I have complete control of my environment. I don’t have to engage with any restaurant nor packages. Instead, all I need to worry about is that my passenger is wearing a mask, I keep a window open to circulate air, and I drive safely from one destination to the next.
I like the control I have of my situation. I like that I don’t have to jump in and out of my car.
I also like that I can make more money transporting people than delivering food. To be safe regardless of whatever type of driving you do, be sure to have a good mask and plenty of extra masks handy in case your passenger does not have one.
Not sure what kind of masks to buy? Here are some options:
These are your standard typical face masks:
These ones are re-usable and come in different sizes for adults and children, plus offer a variety of colors.
As of this writing, the above masks are still available for purchase, but in case they are not when you are reading this, the ones below are reusable and also in stock:
3. Stay Home / Plan B
This is the obvious third option. You could stay at home.
You will make less money (assuming the $600 benefits stop, Californians could still receive $450/week) but also give yourself 40 hours per week to work on your dream job or business, also known as your Plan B.
This graphic compares working 40 hours driving and earning $1,000 gross versus staying home:
Which is better? $650 net driving or $450 and the 40 hours?
If you’re looking for a new gig, check out our article: How to Make Money Fast: 100+ Legit Ideas You Can Start Now.
Some of our top Plan B/gig suggestions include:
- Freelance writing – take a course like Earn More Writing to kickstart this opportunity
- Start your own podcast – use a service like Buzzsprout for hosting and talk about rideshare driving, your own passion projects – anything!
- Learn a skill like bookkeeping to help other freelancers or independent contractors manage their finances – kickstart your education with a course like Bookkeeping Basics
Predictions For The Future
The pandemic has run roughshod over our country. For a while, it looked like we were on the road to recovery, but recently, all we’ve received is bad news.
How will the government respond to this turn of events? Instead of the economy improving as many had predicted, it looks like things will get worse over the next month rather than better.
With so many relying on the FPUC ($600/week), it will be devastating to a huge portion of the citizenry to see those benefits stop.
I have read in articles that this is called a “Cash Cliff” that we are approaching. While many are fighting against eviction, their major source of income is going to stop and given the state of the economy, there are not many jobs to be found.
How will the government respond to a significant portion of the citizenry still out of work while Covid19 cases continue to rise? I predict that some form of government assistance will be created to support the unemployed during this dark time.
Otherwise, a significant source of consumer spending will end, and everyone will suffer if that were to happen.
Needless to say, this is a difficult time for many. If you have to drive, or you want to drive, you certainly can. There are risks involved and demand for rideshare still remains low compared to this time last year. But it is there.
Or you can deliver food. That is a solid and viable option. Or you can stay home and stay safe.
So much of your decision depends on your home situation. Are you alone or can you bring Covid19 home and infect roommates and loved ones? It’s complicated.
The pundits say we won’t know anything about the government benefits until the third week in July after Congress comes back from their holiday. Doesn’t that just burn your britches! Instead of taking action and letting us know what they will be doing, we all have to wait until the very last minute to see what they determine is best for us.
This is a crisis that calls for leadership and we have not seen nearly enough of it during the past 5 months. I hope they do the right thing.
I hope you are safe and are finding time to enjoy this warm weather, socially distanced and wearing a mask.
Readers, what do you plan on doing if Congress does not continue FPUC funding or if your benefits are cut?
Earn up to $25 an Hour with Instacart!Instacart is hiring like crazy right now and offering many perks to drivers, including no under 5 star ratings and more. Sign up here.
-Jay @ RSG