Gig drivers for Uber and Lyft are reducing hours or exiting the industry as soaring gas prices erode profits. The average price of regular gas in California has reached nearly $6, the highest in the U.S., while the national average hovers above $4. Drivers report significant financial strain, with some earning far less than they did years ago.
Drivers Adapt to Rising Costs
John Mejia, a Lyft and Uber driver in San Francisco, says gas prices have made his side hustle unsustainable. "It’s the economics of paying less to drivers and gas prices," he said. "It’s pulling people out of the business." Mejia, who once earned $400 in three hours, now struggles to make $200 in 12 hours. He is among California’s 800,000 gig rideshare drivers facing similar challenges.
Bill Lewis, a former Wall Street trader turned full-time Uber and Lyft driver in Pennsylvania, has adjusted his routes to save on fuel. He drives a Prius but still spends $31 per tank, up from $22 before the war in the Middle East. Lewis avoids long trips to remote areas where he might not secure a return ride, opting instead for shorter, more fuel-efficient routes.
Ride-Hailing Companies Respond
Uber and Lyft have offered limited gas relief, but drivers say the measures come with caveats. Lewis hopes the apps will reintroduce a gas surcharge, as they did in 2022 after Russia’s invasion of Ukraine, which added $0.45 to $0.55 per ride. Such a surcharge could help drivers cover higher costs, but no such policy has been announced.
Long-Term Implications
Drivers are becoming more selective about the rides they accept, cutting hours, and exploring other income sources. The gig economy’s flexibility, once a major draw, now forces drivers to absorb unexpected costs like fuel. Without further relief, many may leave the industry entirely.