UPDATED 00:08 EST / MARCH 05 2018

APPS

Uber blasts MIT study about drivers’ low pay as ‘incompetent’

A new study undertaken by the Massachusetts Institute of Technology revealed that Uber Technologies Inc. drivers as well as Lyft Inc. drivers make less than minimum wage, but now Uber has responded stating that the research is “flawed.”

Uber Chief Executive Dara Khosrowshahi wrote on Twitter, “MIT = Mathematically Incompetent Theories (at least as it pertains to ride-sharing).” The research found that the median profit before taxes that drivers were making was $3.37 per hour. Some 1,100 drivers took part in the study.

In a post on Medium, Uber Chief Economist Jonathan Hall said that MIT’s findings differ considerably from other academic papers written on the same topic. He cited two studies, one a collaboration with Princeton University and another with Stanford University, both of which found that the average gross driver wage was closer to $20 an hour.

Hall added that the MIT study used a “flawed methodology that results in hourly earnings numbers that are far, far below what any previous study has found.” He argued that the questions were not designed in a way that would ascertain a fair result of Uber earnings and led respondents to misreport how much time they spent working for ride-hailing companies and other companies.

MIT acknowledged over the weekend that some of the questions could have been misleading, and lead author Stephen Zoepf said he would reword some questions.

TheRideShareGuy’s annual driver report showed that the average wage for Uber drivers was  $15.68, but that’s before expenses, including gas and maintenance of the car.

The MIT study showed that about half of earnings go to expenses, which is something Uber hasn’t denied. With that in mind, it still may be that driving for Uber isn’t a very lucrative occupation. The survey showed that although drivers believed they should be paid more, they enjoyed the flexibility the job provides.

Image: quotecatalog via Flickr

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