Uber CEO Dara Khosrowshahi had some words to say about the new MIT study that was published. The study claims that the median income for Uber and Lyft drivers is just $3.37 per hour, and that 30% of the drivers working for these companies are actually losing money while they work.
In a Twitter response, Khosrowshahi wrote, “MIT = Mathematically Incompetent Theories,” and shared a response from the company’s chief economist, Jonathan Hall. While calling MIT researchers as “incompetent” may be a long shot, Hall’s claims to have found a flaw in the MIT study, and not entirely compelling.
MIT = Mathematically Incompetent Theories (at least as it pertains to ride-sharing). @techreview report differs markedly from other academic studies and @TheRideshareGuy recent survey. Our analysis: https://t.co/S2aAqCuDR0
— dara khosrowshahi (@dkhos) March 3, 2018
The MIT study used data from a survey that was conducted by The Rideshare Guy, aka Harry Campbell, a leading independent analyst and rideshare driver advisor. Uber economist Hall argues that some of the questions, due to unclear wording, could lead respondents to provide misleading responses on how much time they spend working for ride-hailing services, as well as misreport their income. Hall says that this drives down the hourly rate MIT reported by nearly 60%.
On Twitter, Campbell says that he has since modified at least one of the survey questions, to try and address Hall’s concerns. Hall says that Uber doesn’t take issue with the MIT study’s assessment over driver costs, which is a major factor in its calculation of lower per-hour pay. These costs, including maintenance of vehicles drivers down, lease fees or depreciation, have been excluded from many previously sties of Uber’s driver pay.
The most recent version of Campbell’s annual driver survey has found that 30.9% of Uber drives reported earning less than $15 per hour, and that’s before expenses. The MIT study found that driver expenses were about half of revenue on a per-mile basis, a finding that Uber doesn’t contest. Considering some for the arguments Uber makes, even if the pay is not $3.37 per hour, many Uber drivers’ really hourly income is far below the minimum wage.