The most sought-after taxi-hailing app ‘Uber’ is likely to maintain its low fares if it continues to pay its drivers poorly, according to a research penned by economist Jim Stanford, The Guardian reported on Wednesday.
The survey was based on fares in six urban cities – At least three in Australia, found that the drivers were left with a barely one-third of the fare – excluding taxes, driver fees and vehicle costs.
Moreover, in addition to low income, the drivers are also not entitled to pensions or leaves.
Once a lucrative source of income, Uber has now become a liability for those driving for the company due to maintenance, tax and fuel costs that entail. The decrease in profits can also be attributed to the increase in the number of drivers working for Uber.
Drivers can earn extra during surge hours; however, it gets challenging to determine when fares are at peak and therefore, cannot be relied upon.
“The company dresses this up as flexibility but the money is so bad and uncertain that it’s only in an environment that people are desperate that this model can work,” said Stanford. According to Stanford, however, Uber would not be able to sustain itself if it happens to offer better pay to its labor.
As per the study conducted, due to a decrease in income, Uber drivers are now encouraged to seek for better opportunities that do not demand long tiring hours of driving.
Therefore, Uber is finding it hard to sustain itself keeping drivers and customers satisfied.