Strategic CSR - Uber

The article in the url below does a good job of quantifying the effects of the gig economy on individual earnings:

 

"How much money do Uber drivers really earn? Since launching in 2009, the company has often changed its pricing model, and the amount of money Uber drivers make has shifted as well. Yet the company has become so large, and been studied so much, that a clearer picture has emerged of what a driver can truly expect to make."

 

The data summarized in the article comes from a lending company, Earnest, which drew upon loan data where applicants had reported the income they earn from Uber-like jobs. The results do not include information on whether the income is gross or net; or how many hours it took to earn the income:

 

"Earnest found that the median Uber driver makes $155 a month — third most among the nine gig platforms surveyed. (People working with Airbnb and Lyft tended to earned more.) Meanwhile, the average Uber driver makes $364 a month — fourth most — suggesting some drivers are taking home the lion's share of possible earnings."

 

Additional studies are also summarized and reveal some fascinating data. There are some great graphics in the article. Here is one comparing earnings across different firms in the sharing economy:

 

https://timedotcom.files.wordpress.com/2017/07/screen-shot-2017-07-05-at-12-14-36-pm.png

 

Here is another that breaks down earnings for Uber/Lyft drivers by age group:

 

https://timedotcom.files.wordpress.com/2017/07/gross-hourly-earnings-for-uber-and-lyft-drivers-by-age-1.png

 

And, here is another one showing earnings for Uber/Lyft drivers, by state and per trip, across the U.S.:

 

https://timedotcom.files.wordpress.com/2017/07/3048563-inline-i-1-uber-lyft-prices.png

 

Other studies reveal the variations among drivers across cities:

 

"For even more background on how much Uber drivers make, consider a 2015 study funded by Uber, which found that in its top-20 cities drivers averaged more than $19 an hour in earnings before expenses. However, a year later, internal Uber figures provided to Buzzfeed showed that after expenses were factored in, drivers in three markets — Detroit, Houston, and Denver — earned only $8.77, $10.75, and $13.17 per hour, respectively."

 

A key question the article doesn't raise, though – does the flexibility offered by such jobs outweigh the relative insecurity/low wages on offer? When I travel in an Uber car, I often ask the driver what s/he thinks about working for Uber. The most common answer I get is that they do not want to be an 'employee' and welcome the flexibility that Uber offers them. If so, are we (society as a whole) best served by letting these people structure their work lives as they wish, or by stepping-in to constrain them 'for their own good'? In other words, in a freely voluntary exchange of labor for money, is the driver working for Uber because s/he has to or because it provides them with the flexibility they otherwise cannot find in other jobs that may pay more (and include benefits), but ultimately are deemed to be less fulfilling?

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (4e)

© Sage Publications, 2017

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler4e

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

 

 

Here's How Much Uber Drivers Really Make

By Rob Wile

July 10, 2017

Money

http://time.com/money/4845407/uber-drivers-really-make-per-hour/

 

Strategic CSR - Uber

The article in the url below raises an interesting question:

 

"What if Uber kills off public transport instead of cars?"

 

While this may not be a very pressing concern in most U.S. cities, where public transport is generally less well-developed; in Europe, public transport is central to most city life:

 

"The perceived wisdom is that Uber has disrupted taxis and that private automobiles are next, but what if we've misread what is happening in our cities? Traditional thinking would suggest that UberPool, which allows users to split the cost of trips with other Uber riders heading in the same direction, will always be inferior to public transport. Sitting in the backseat of a Prius may be more comfortable than standing on a crowded bus or train, continues this reasoning, but carpooling can't substitute for mass transit at rush hours without massively increasing congestion."

 

Rather than simply offering an alternative method of transportation for those who can afford it, the aggressive pricing on Uber Pool appears aimed directly at public transportation – seemingly with the goal of eventually replacing it:

 

"This is wrong. In the last six months, Uber has begun offering shared rides for as little as $1 (81p), introduced optimised pickup points that algorithmically recreate bus stops, and started testing semi-autonomous vehicles it hopes will solve its increasingly contentious labour issues."

 

A standard economic answer to this problem would be that Uber will only succeed in replacing public transportation if it ultimately adds more value than buses and trains. If it is cheaper (shared costs), more comfortable (no standing), and more convenient (picks you up at your house), then it may indeed add more value. The danger, I guess, is if Uber follows the pattern it has demonstrated with its drivers (see Strategic CSR – Gig economy and also here), where it offers financial incentives to sign-up, but then decreases those benefits slowly over time. The equivalent with public transportation is if it is initially much cheaper to use Uber, but becomes more expensive once government has cut the relevant funding.

 

Have a good weekend

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (4e)

© Sage Publications, 2017

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler4e

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/

 

 

What if Uber kills off public transport rather than cars?

By Greg Lindsay

January 13, 2017

The Guardian

https://www.theguardian.com/sustainable-business/2017/jan/13/uber-lyft-cars-public-transport-cities-commuting

 

Strategic CSR - Gig economy

The article in the url below provides some fascinating insight into the lives of people working in the gig economy for firms like Uber, Deliveroo, and TaskRabbit:

 

"There are no good estimates on the global scale of the gig economy but in the US there are about 800,000 people earning money this way without being anyone's employee."

 

"Algorithmic management" is the term academics have devised to explain how the working lives of these people are increasingly being dictated by software (via apps) as opposed to by managers (as in a traditional organization and employer/employee relationship):

 

"For companies like Uber, which aspires to 'make transportation as reliable as running water,' algorithmic management solves a problem: how to instruct, track and evaluate a crowd of casual workers you do not employ, so they deliver a responsive, seamless, standardised service."

 

These algorithms essentially track every aspect of the work being conducted for the company as soon as each worker logs on to the app. It dictates everything from how quickly they must respond once an opportunity is sent to them (within 30 seconds for Deliveroo) to assessments of performance:

 

"Deliveroo's algorithm monitors couriers closely and sends them personalised monthly 'service level assessments' on their average 'time to accept orders,' 'travel time to restaurant,' 'travel time to customer,' 'time at customer,' 'late orders' and 'unassigned orders.' The algorithm compares each courier's performance to its own estimate of how fast they should have been. … Drivers for Uber's ride-hailing app, of which there are about a million around the world, are subject to similar algorithmic control. They choose when to work but once they log on to the app, they only have 10-20 seconds to respond to 'trip requests' routed to them by the algorithm. They are not told the customer's final destination until they have picked them up. If drivers miss three trip requests in a row, they are logged out automatically for two minutes. Uber sends drivers a weekly report including their confirmation rate and average customer rating (out of 5)."

 

Rather than something new, however, "algorithmic management" is increasingly thought of as an extension of innovations that were the foundation of the field of management:

 

"'Algorithmic management' might sound like the future but it has uncanny echoes from the past. A hundred years ago, a new theory called 'scientific management' swept through the factories of America. It was the brainchild of Frederick W Taylor, the son of a well-to-do Philadelphia family who dropped his preparations for Harvard to become an apprentice in a hydraulics factory. He saw a haphazard workplace where men worked as slowly as they could get away with while their bosses paid them as little as possible. Taylor wanted to replace this 'rule of thumb' approach with 'the establishment of many rules, laws and formulae which replace the judgment of the individual workman.' To that end, he sent managers with stopwatches and notebooks on to the shop floor. They observed, timed and recorded every stage of every job, and determined the most efficient way that each one should be done. … For Jeremias Prassl, a law professor at Oxford university, the algorithmic management techniques of Uber and Deliveroo are Taylorism 2.0. 'Algorithms are providing a degree of control and oversight that even the most hardened Taylorists could never have dreamt of,' he says."

 

As companies tighten the screws, however, these workers are beginning to pushback, complaining that they were lulled into working for these companies with elevated pay rates and conditions that are then gradually reduced. The recent lawsuit against Uber (in California and Massachusetts) is a good example of this. Something similar (although less formal) also occurred over the summer in London – "one of the first industrial disputes to hit the city's so-called gig economy":

 

"These are workers without a workplace, striking against a company that does not employ them. They are managed not by people but by an algorithm that communicates with them via their smartphones. And what they are rebelling against is an app update."

 

While it is clear that many people self-select into these jobs because they fit their lifestyle at present ("Some 85 per cent of couriers have told Deliveroo they use it for 'a supplementary income, or short-term flexible work'"), it is also clear that the structure of these jobs are redefining the nature of 'employment' in a way that poses significant challenges to courts (that have to deal with grievances today) and public policy planners (who will have to deal with the social consequences in the future if these jobs fail to provide the healthcare and pension support these people will need at some point). There is also, of course, a moral component to the way these jobs are structured. While some see them as facilitating 'flexibility' and others see them as incentivizing 'abuse,' the danger is that whatever we gain in productivity in the short term ("Taylorism 2.0"), we lose in our humanity over the longer term.

 

Take care

David

 

David Chandler

Strategic Corporate Social Responsibility: Sustainable Value Creation (4e)

© Sage Publications, 2017

 

Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler4e

Strategic CSR Simulation: http://www.strategiccsrsim.com/

The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/


When the boss is an algorithm

By Sarah O'Conner

September 10/11, 2016

The Financial Times

Late Edition – Final

Life & Arts, 1

https://www.ft.com/content/88fdc58e-754f-11e6-b60a-de4532d5ea35