Uber Better Not Be the Future of Work

A study by the Massachusetts Institute of Technology’s Center for Energy and Environmental Policy Research made a splash the other day when it claimed that the median pay of an Uber or Lyft driver in the U.S. is only $3.37 an hour before taxes -- less than half the federal minimum wage of $7.25. That dismal number seemed to confirm many people’s fears that the gig economy impoverishes workers.

The company’s defenders quickly pounced. Uber’s chief economist, Jonathan Hall, wrote a blog post criticizing the survey measures the MIT team used to generate their results. The survey was ambiguous about whether it asked people about the total hours they spend driving for on-demand taxi services or whether it asked about their total hours worked (since many Uber drivers have other jobs). As a result, the MIT study probably understated on-demand drivers’ hourly wages by a significant amount. The authors of the paper, realizing their mistake, issued a correction.