Uber

Driving for Uber has Jaded Me

Uber is a powerhouse in the arena of ride sharing, and I took pleasure in deleting my app. After being rocked by scandal after scandal, Uber just seems to be on a downward slide, and they just can't seem to get their shit together.

In the last 2 months, 9 separate executive officers have left the company, and for good reason. The CEO seems to be hell bent on not only making himself look bad, as many of us saw the YouTube video of him going at it with an Uber Black driver but also making the entire company look terrible too. Beyond arguments, CEO Travis Kalanick seems to care more about killing competitors than making a profit.

Kalanick argues in the YouTube video that they needed to lower prices to be competitive, yet Uber has never made a single dollar in profit. In fact, Uber lost $2.8 billion last year alone, and that has been a trend for many years. Can a company truly be competitive if they don't make a single dollar? Maybe the better question is, Where do we draw the line for competition? Is it competitive to purposefully not turn a profit in an effort to kill competition?

One of the biggest problems in Kalanicks approach comes right down to the drivers. I've driven for Uber in a smaller market, my current home of Greenville, SC. Greenville is a small city of only 60,000 in Greenville proper. This leads the market to be over-saturated with drivers and little demand for the service.  When I drove for Uber, my average hourly earnings consistently hovered around $9 per hour. In comparison, taking a full-time grocery position starts you off in the $10-$11 range and goes up from there. Taking another job also reduces wear and tear on the car and may even provide benefits like health care. None of which Uber provides.

Kalanick gets even worse in my and many drivers opinions. Uber's main competitor, Lyft, provides a way to tip the driver right from the app, something Uber refuses to do. Uber's position has always been the same here, that you shouldn't need to tip and that is a reasonable position to take under one circumstance, that the company pays a living wage... which Uber does not. This is completely a case of Uber being belligerent, this would be a minor feature to add, but they refuse to do so for some unknown reason... well at least an unknown and valid reason.

Aside from the driver concerns, Uber also continues to expand at a breakneck pace. Much of their losses in the past have come from expanding to new cities much faster than their competition. These losses have come with a major consequence though, company employees. Many Uber employees joined the company with incentives of stock options once the company went public... but it's been 8 years now and the company has yet to launch its IPO. The massive losses Uber suffers every year have a lot to do with that, what investor wants to put money into a company that doesn't turn a profit?

As Uber continues to lumber down the road of money loss there appears to be even more skeletons in the closet. From the top down, the appears to be a culture of in fighting, corporate espionage, and down right sketch behavior. Paying employees to ride with Lyft drivers and talk them into leaving Lyft, to accusations of sexual abuse in the work place. Uber is losing the image war and Kalanick seems to be the CEO that just doesn't get it. The only question left is, how long will Kalanick last at Uber? It might just be time to kick him out on his ass.

My Experience - Is Driving Uber Worth It?

I've just started driving for Uber this week and it has quickly answered a few questions for me. Everyone always seems to be trying to determine what Uber pays to someone driving for them full time and if it is worth it. There is lots of back and forth on this issue. My opinion is somewhere in the middle, but it is far from a glowing experience.



My initial idea on driving with Uber was to make a decent amount of money until I can find a full-time job. At the same time I have taken a job that on the surface pays far less than Uber pays at only $10/hr... so why take the $10/hr job?

In order to answer that question, we need to look at how things have gone in my first 3 days driving with Uber. 

Earnings

  • Friday - $53.85
  • Saturday - $76.67
  • Sunday - $51.08

Looking at how much I earned is not the whole story. We also need to look at how long I spent driving. 

  • Friday - 4 hours
  • Saturday - 8 hours
  • Sunday - 3.5 hours

As you can see, how much you make driving for Uber can vary wildly depending on the day. Friday and Sunday I averaged around $15/hr. Saturday I was only able to average about $11/hr. So overall this seems pretty good right? We haven't begun to factor in the costs of driving for Uber, and boy are they extensive.



Taxes

When you drive for Uber, they list you as an independent contractor. Doing things this way is better for Uber and much much worse for the drivers. Being an independent contractor means all of the taxes need to be covered by the driver themselves. I have already made a decent amount from my previous job this year meaning I expect my Federal tax rate to be 25%, add that to South Carolina's incredibly high income tax rate of 7% and we're already looking at 32% of my income allocated to taxes. 

Wait that's still not everything, I am now required to pay Self Employment tax to cover Social Security, Medicare, and everything else under that category at a blistering 15.3%. Those of you keeping track, yes this means that 47.3% of everything I make is taxed almost cutting my earnings in half.

Gas

Aside from taxes, gas purchases are going to massively eat into your earnings. If I worked 8 hours a day, I'd need to fill my car up around 4-5 times a week at $25 per fill-up. In other words, I'm spending $100-$125 per week on gasoline.

Tax Incentives

Many of you may be aware of the ability to write off the mileage on your car. The current Federal mileage rate is $0.54 per mile. This is quite a lot of money to be able to write off. Now this will likely negate many of the taxes you owe to the government, but the write off only applies to your taxes at the end of the year. Until the tax season closes you will need to carry that money in case your taxes don't work out exactly as you plan, meaning that money is unusable until you file taxes.

Conclusion

Uber is the only one making out well in this deal, and even they seem to be struggling to turn a profit these days. Drivers bear all of the burden with taxes, wear on the car, mileage, and gas purchases. If you add in that Uber suggests buying water and candy for riders too, it just becomes unreasonable at some point. 

This is not to mention that you must carry your own health insurance that could easily wipe out a week's worth of earnings.

Keep in mind that I am forced to drive with UberX which has the worst rates out there. I drove a full hour with a passenger yesterday and earned $35. Keep in mind that it was another full hour back to Greenville to get near where there were more passengers for me to start picking up. 

So, should you drive for Uber?

If you need to do this for extra money, it will work for that. If you are considering doing this full time, turn around and run the other way fast! The math is just not in your favor.

Are Background Checks An Effective Tool?

This morning, after a battle with Uber's background check company for weeks, I was finally able to get approval to drive for Uber. After going around and around with Checkr, the company used by Uber for background checks, the question that sticks in my mind is, How effective are these checks? Are they effective in the least?



In 2012 I moved from my temporary home in Arkansas, to the Philadelphia area. Upon moving I had to find a new home, and I chose to live in a great place in Delaware, one of my favorite places I've ever lived. The community and apartments were great, but I first had to pass a background check. This was not abnormal, I'd been through them many times for apartments, and jobs. Never before did I have an issues... until now. 

After submitting the information to my apartment complex, I was quickly denied based on crimal history. CRIMINAL HISTORY!? To this day I have never been arrested, never done drugs, I don't even like to drink. Hell, I have to this day never even had a traffic ticket... Imagine my surprise when someone said that there was a felony under my name. 

Making a call to the background checking company, I was shown first hand how innacurate these companies can be.   My name is a common one, and the short year I lived in Arkansas caused the background check company to mix me up with another person of the same name. How does something like this happen?

It seems that it was entirely based on name. Me and this other person did not share a birthdate, we were months apart on the calendar year, and he was a full year older than me. Our social security numbers were not close either. It seems that this was based completely on our names, and that is a major problem. How accurate can a positive background check be if a negative one can so easily be created by mistake? This is by no means an isolated insident.  

While on the whole I think Uber is safe, almost entirely. You may be able to find the occasional incident where an unsafe driver was in a car for uber, but most people are good and most do not commit crimes. With the problems I've had with their background checking company not being able to verify that I've been driving for more than 1 year, even though I've had a license for 15 years. With that being the case, how accurate are any of their background checks. It's a realistic question that must be asked of any background check, are they even worth the money paid for them or the effort put into one.

 

Uber's Background Check On Me Is A Nightmare

While I have not yet disclosed this here until now, I'm currenlty looking for employment after our recent move to South Carolina. Employment in engineering is notoriously slow down here and in the mean time I've decided to try to find another form of employment until I can gain an engineering or other position full time. That's when I decided to turn to Uber.



Yes, I am aware of the major downsides to driving for Uber, but this is not a full time career for me, just a way to make money until a full time position can be secured in my normal job field. 

If you've ever followed any news about Uber, you likely know that the company is often blasted for not doing proper checks on their drivers. Now that I've been able to experience the first steps of the process, let me assure you that their background check company is a walking nightmare. Let me explain.

In the past 14-15 years I've moved a lot. My home town is in central New York, I went to school in Florida and took my first job in Kansas. After that I was moved around for my job to Arkansas, and Delaware. After changing jobs I moved to Pennsylvania and lived in two different places in Pennsylvania. Just recently I again moved, this time to South Carolina. As you can imagine, all of this moving means I've had many different drivers licenses.

Under Uber's background check requirements, you must show at least 1 year of driving history. Since I moved to South Carolina recently, my drivers license only shows an active driving history of a few months, meaning that I was required to provide more information to Uber for past driving history. Problem is, South Carolina like many states, now takes your old drivers license once one is issued in your new state. That means I no longer even know my old drivers license number. This remains true for Kansas, Delaware, and New York where I have also held past driver licenses.

If you don't have an old license.... and you shouldn't, you need to provide a drivers record. Problem is, you need your drivers license number to get access to this information. Luckily I hadn't updated my Global Entry profile to my new license, so I was at least able to snag my PA license number. This did not fully solve the problem. In my drivers record from PA, they only listed my last issue date of my license, which I had reissued to me when I needed my address to be up to date for a visa application. This means that according to my drivers record, the license in PA only showed last December as my license start date, despite the original license being issued years before that.

The ability to even grab my history in PA was all due to luck that I even was able to find my license number. All other states requested a license number as well. It's been 4 years since I had a DE license, 6 since Kansas, and 12 since I had a NY license. I just don't have those numbers anymore. Yet Uber offers no other options.

Uber customer support took a full hour to understand what I was saying the problem was here. I just couldn't access older records, and PA wasn't giving the full history I needed. After an hour with support, they told me to spend a further $32 on a certified record, yeah I didn't mention that each record costs $9 online, and $32 for the certified record.

I suspected this was bad information on Uber's part, and luckily I called PA DMV to verify my hunch. It was in fact bad advice from Uber. I actually needed to call PA and request that they modify the record to show full history of my license renewel and changes. They promised to have it mailed within two days. Imagine that, a DMV that was more helpful than Uber... who would have imagined.

So, in the end, PA DMV will take care of my problem, where Uber had no solutions. Uber relies on a 3rd party background check company that needs to get itself together. Very little information has been given to me at any stage of this process. Maybe I'm the lone person who has moved this much, but I highly doubt that is the case. Really the true story is that things need to be better managed with Uber background checks. I have 15 years of driving history... it should be easier than this to prove it.

Uber... My Hero

Up until this most recent trip, I had traveled almost exclusively to cities with a robust subway/metro system that I would be able to use. This always made getting around quite easy and totally under my control of where I go and when, but South Africa lacked this feature and left me the question on how to get around.



Uber easily stepped in to help me out with this. I've long had an Uber account, but when I lived in Philadelphia, there was rarely a need for it, we often walked to restaurants and whatever else we needed to get to. Philadelphia is a very walkable city and often is not in need of taxis or Uber rides. Once I flew to Cape Town though, this became a vital transportation method between the airport and my hotel.

After Cape Town, Uber became a workhorse in Dubai, something I was not expecting. My hotel, The Westin Al Habtoor City, in Dubai, was still finishing construction. Beyond that, the surrounding area was under construction. A new canal was being built and cut off where the old road used to run, the road I was planning on using to get to the hotel from the nearest metro station. There was no longer an easy way to get to the metro from my hotel.

Uber was ready to take on the burden here and get me where I was going. To and from the airport, back and forth between the Dubai Mall and the hotel. Uber got me to see the Burj Khalifa and to the Dubai Mall where I was then able to connect to the metro to other parts oft he city. Occasionally you get a bad driver, but for the most part the drivers were great and got me quickly to my destination and back. 

Uber is the way to go when it comes to foreign travel, when the metro isn't an option. It became my go to, even when I came home. Uber just yesterday was able to get me over to the repair shop so that I could finally get my car back and have full use of it again. Use it when in need, it's far easier than a taxi and I don't have to worry about being scammed by a driver since Uber handles all the transactions.