Uber’s use of dynamic pricing has led to higher fares for passengers and lower earnings for drivers, whilst increasing the company’s share of revenue, a study has suggested.
The University of Oxford study analysed data from 258 Uber drivers in the UK over more than 1.5 million trips between 2016 and 2024.
It found there had been a “significant shift” when the company introduced a dynamic pricing algorithm in 2023, which it said meant “passengers now pay more per trip, but drivers’ earnings have declined”.
Uber said some claims in the report were “totally false”, adding that all drivers were shown their potential earnings for a trip before deciding whether to accept it.
The study, which was carried out by researchers from the university’s Computer Science department, said Uber’s commission had risen from about 25% to 29% since its dynamic pricing model was introduced.
In the same time, researchers found that drivers’ hourly income fell from more than £22 to just over £19 – with drivers spending more unpaid time waiting for rides than before.
Uber began operating in Oxford in February, despite private hire and black cab drivers warning the taxi app giant that it may struggle to succeed in the city.
Researchers said the study “highlights the widening gap between what customers pay and what drivers receive”.
“The higher the value of the trip, the more of a cut Uber takes. So the more the customer pays, the less the driver actually earns per minute,” its lead author, prof Reuben Binns, explained.
The study was commissioned by the Workers Information Exchange, which is run by former Uber driver James Farrar – who previously successfully campaigned for the company’s drivers to be treated as workers, rather than self-employed.
Responding to the study, an Uber spokesperson said the company “do not recognise the figures in this report.”
They highlighted that drivers in the UK took home more than £1bn in earnings between January and March of this year, with all drivers receiving a weekly summary of their earnings, including a “clear breakdown of what Uber and the driver received from trips”.
On average across the week, the percentage kept by Uber has “remained stable for several years, but can vary from week to week and from one driver to another”, the company said.
“We are proud that thousands of drivers continue to make the positive choice to work on Uber as passenger demand and trips continue to grow,” the spokesperson added.
Credit: Source link
