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The Technology 202: Uber and Lyft have been reshaped by the pandemic economy

Analysis by
Staff writer
June 25, 2021 at 8:51 a.m. EDT

with Aaron Schaffer

To get a sense of how the pandemic has reshaped vast segments of the workforce, just pay attention the next time you try to hail an Uber.

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Uber — you remember it, right? That icon collecting dust somewhere in your phone — the app you used to tap to grab a quick ride to the grocery store, out to dinner or maybe to a medical appointment? Gosh, was it always this expensive? And why does it seem like the driver is always 10 minutes away?

The Post’s Heather Long has written about “a great reassessment of work in America.” And more recently, The Post’s Abha Bhattarai covered an exodus from retail, as workers ditch low-paying jobs for less-stressful positions, more flexible work or even to go back to school and learn new trades. Meanwhile, a similar dynamic is playing out in the gig economy, which has been dogged for years by complaints of low pay, stressful conditions and allegations of exploitation of its massive contract workforce. In this new environment, even the promise of better pay has been insufficient to draw drivers back.

Uber CEO Dara Khosrowshahi recently said median earnings in New York and Philadelphia were $37 an hour, well over what drivers might typically collect. 

“What the folks that are complaining they want to see: they want to see things like minimum wage, higher per mileage rates, longer lasting structural change,” said Harry Campbell, founder of the blog the Rideshare Guy, which writes about the gig economy and serves as a resource for drivers. “They’re worried this is a short-term bump.”

The steep supply shortages on the heels of the pandemic present a unique challenge in the decade-long history of Uber and Lyft. 

The companies have prioritized convenience and cost, dangling bonus incentives and rider discounts to ensure a driver was always around the corner and prices were competitive. But now drivers, the companies say, are staying home out of lingering fear over the pandemic and concern that demand is down. That is sometimes leading to ballooning prices, longer wait times and a diminished experience for users of the apps, with few signs of relief.

Company executives and gig economy experts also attribute the situation to drivers continuing to collect unemployment and other government assistance rather than returning to often-stressful and low-earning work; The Post reported in March that “Uber” and “Lyft” were the two most common business names reflected in certain government grant and loan programs established to help small businesses weather severe economic disruptions. That could open a relief valve as those types of assistance phase out with the larger reopening of the economy this summer and fall.

But in May, some drivers told The Post they were likely done for good, after the coronavirus pandemic provided the first glimpse at what life after Uber could look like. And there was added frustration in April when Uber dialed back features aimed at providing independence for drivers in California and uncoupled driver earnings from passenger fares. That meant some drivers who might collect an astronomical payout on a long ride would only receive a small, predetermined bonus from the company — another way they saw Uber clawing back money from them.

Khosrowshahi pushed back in a Twitter thread, arguing that the share of driver pay compared to passenger spending was higher after the changes.

Meanwhile Uber and Lyft, for their part, are confident drivers will eventually return to the streets. For now, the companies are yet another example of how the pandemic has remade parts of daily life we have otherwise taken for granted.

Our top tabs

A House committee advanced all six bills in an antitrust package targeting tech giants.

The House Judiciary Committee approved the bills, which target the far-reaching power of Big Tech, in a marathon meeting, Rachel Lerman reports. But the meeting also revealed fissures on Capitol Hill as major technology companies lobby lawmakers to defeat the bills.

The sixth bill lawmakers advanced has the most significant implications, giving regulators the ability to break up the companies if they have an “irreconcilable conflict of interest” between their roles operating platforms and the other parts of their business. Lawmakers narrowly advanced the measure in a 21-to-20 vote.

Google delayed its plans to block third-party tracking cookies on its popular Internet browser.

The tech giant planned to make the change by early next year but has delayed it until the end of 2023 amid pressure from regulators and competitors, Gerrit De Vynck writes. The move could have far-reaching implications because Google Chrome is used by about 70 percent of desktop computer users worldwide.

Google says its alternative to cookies will allow advertisers to show relevant ads without stockpiling data on users. But critics say its driven by a desire to get an edge on its rivals and push advertisers toward advertising on Google and YouTube, which don’t need cookies to target people.

A major U.S. labor union voted to support unionization efforts at Amazon.

Delegates at the International Brotherhood of Teamsters’ convention overwhelmingly voted for the resolution supporting an initiative to boost unionization efforts at the e-commerce giant, the Verge’s Zoe Schiffer reports.

“Amazon presents a massive threat to working-class communities and good jobs in the logistics industry,” said Randy Korgan, the initiative’s national director. “Amazon workers are calling for safer and better working conditions, and with today’s resolution we are activating the full force of our union to support them.” 

Amazon did not respond to a request for comment. (Amazon CEO Jeff Bezos owns The Washington Post.)

Rant and rave

At the unveiling event for Microsoft's new Windows 11 operating system, Microsoft CEO Satya Nadella made some not-so-subtle swipes at Apple. The Verge's Nilay Patel:

Our colleague, technology columnist Geoffrey A. Fowler:

Agency scanner

New FTC chief Khan names some top staffers, including competition chief (Reuters)

Inside the industry

Windows 11 will change how you use your PC (Geoffrey A. Fowler and Tatum Hunter)

After repeatedly promising not to, Facebook keeps recommending political groups to its users (The Markup)

Trending

Some UFO believers hope a new report will be vindicating. But others say they’ve been burned before. (Travis M. Andrews)

‘They can’t do it without us’: Black TikTokers strike to protest dance appropriation (The Guardian)

Mentions

  • Tomicah Tillemann, the executive director of New America’s Digital Impact and Governance Initiative, is joining venture capital firm Andreessen Horowitz as global policy head for its new cryptocurrency fund. He was a Senate Foreign Relations Committee aide when President Biden was its chairman.

Daybook

  • Rep. Ken Buck (R-Colo.), the top Republican on the House Judiciary antitrust subcommittee, discusses antitrust legislation at a Washington Post Live event today at 11 a.m.
  • Acting Federal Communications Commission chairwoman Jessica Rosenworcel discusses the Emergency Broadband Benefit program at a New America event on June 29 at noon.
  • The House Energy and Commerce Committee holds a hearing on securing U.S. networks on June 30 at 10:30 a.m.

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