There’s a gender pay gap for Uber drivers and we’re not super thrilled about it. However the reasons behind the gap are incredibly complex so we thought we’d break it down for you. Stanford University and University of Chicago professors sat down with economists at Uber to have a look at the earnings of one million-plus drivers over roughly two years. Their results came out yesterday and showed that there’s a 7% earnings gap with male drivers coming out ahead of female drivers.
Let’s get down to brass tacks: pay is completely standardised for Uber drivers. They all earn a base fare as well as a per-kilometre/mile and per-minute rate which varies depending on the city they’re in. Drivers can earn additional income through incentives and surge pricing and those incentives aren’t in any way tied to gender. Secondly the algorithm that assigns jobs to drivers is gender-blind. But that doesn’t explain the fact that, on average, men earned about $1 more per hour and about 50% more per week then women. The researchers have boiled it down to three factors: driver’s location, speed and experience.
Men usually drive in areas with lower wait times and higher surge pricing and they also drive faster – this means they finish jobs more quickly and can move on to the next even faster. But the kicker is experience – men tended to drive more hours for Uber in a given week and therefore picked up key skills on working Uber to their advantage, such as knowing when to accept and cancel jobs – and they picked up these skills faster than female drivers. It’s especially important when you consider how Uber works for the driver’s side: when they are first assigned a dispatch, they’re told the rider’s starting location and how long it will take them to get there and pick up the rider. From there they can accept or reject a ride. The study states that, “If a driver has reason to think, by rejecting a ride, he or she will be offered a closer dispatch shortly, that driver may be able to increase expected earnings by not accepting the first dispatch”. In layman’s terms, the first loss is the least. This is an old trading phrase that looks at how a small sacrifice in the beginning can bring you a greater return in the long run and it’s sometimes a hard pill to swallow. Another reason behind all of this? Men are usually more willing to take risks than women. They’re happier to risk rejecting an initial job in favour of a better one soon after. All food for thought.
On the plus side, Uber has said it may use the study’s findings to offer tools and upskilling that will help drivers master those accept/reject skills more quickly, evening the playing field for those who choose not to drive as often.