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Gender earnings in the gig economy

Last year, 5 economists published a research paper called “The Gender Earnings Gap in the Gig Economy: Evidence from over a Million Rideshare Drivers.” The authors are 2 economists employed by Uber; 2 professors at Stanford University; and the chairman of the University of Chicago’s economics department.

The findings were widely discussed, including on Steven Levitt and Stephen Duber’s Freakonomics podcast (Episode 317). What’s interesting about Uber’s ridesharing data is that their compensation algorithm is believed to be entirely gender-blind.

The formula is pretty simple. It takes into account distance, time, and sometimes a surge multiplier when demand is spiking. Gender does not factor. And the same goes for the actual dispatching of rides. The software doesn’t know who is male and who is female.

What they discovered is that on average male Uber drives earn about 7% more per hour compared to females. And that 50% of this wage gap can be (apparently) explained by one variable: Men tend to drive a little faster than women. So they complete more rides per hour.

It’s also worth noting that across the US, only about 27% of Uber drivers are female (at least at the time the report was published). Women also have a higher 6-month attrition rate; 76% compared to 63% for men. In other words, more female drivers drop off the platform.

If you’re interested in this topic, you should probably have a listen to the Freakonomics podcast. They deliberate on the above in a lot more detail. You can also download a full copy of the research paper, here.

Photo by Luke Stackpoole on Unsplash

1 Comment so far

  1. Cheryl Hawkes

    This is a study produced by at least 3 people who work for Uber, two in-house, one as a “moonlighting” lead consultant. So we have to take many of the underlying assumptions on faith. The sunny definition of Uber, for one , is pure marketing. BD, I appreciate you are an Uber booster, but if you receive any benefit from writing about this invasive urban species, you should declare it. There is so much known about the drawbacks of the Uber model, it is difficult to buy into an in- house study. Much like the dated, limited and meagre # of studies (2?)that promote Uber as an antidote to drunk driving. Uber pays MADD Canada for its endorsement and in turn, MADD does cross-promotion for Uber. Buying into the mythology of ridesharing as a transportation advancement is naive. Drivers make less than minimum wage and safety is an afterthought. It’s biggest fear is any measure that clips it’s ability to sign on new drivers online with impunity. Like the clueless one who stopped his car on the highway to retrieve his cell phone, resulting in my son’s death here in Toronto. Uber has never posted a profit and revenues in 2018 folded in a one-time sale of its Chinese operations, not an operational
    success. The company just axed 1/3 of its marketing staff, employs an army of in-house lobbyists to keep up the pressure on legislators at every level . It’s a cheaper ride for you, but a large part comes straight out of your driver’s pocket and into Uber coffers. Motorized rickshaws. Every dime ridesharing fees earn the City of Toronto is lost on the TTC. Penny for penny. . Imagine every person on that packed streetcar being transported alone in the backseat of a medium-sized sedan and ask yourself if you really need a study to determine if ride hailing contributes to urban congestion and pollution.

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