Objective mobility and food delivery data will play a pivotal role in the continuing struggle between equitable gig driver pay and the need for gig platforms to make a profit. Caught in the middle of this tug-of-war are the passengers and food delivery consumers who pay for these services and have come to rely upon them, as well as the cities and other jurisdictions trying to establish equitable laws that are fair to all participants.
There is no better example of this than the current situation in Seattle, WA. In 2020, Seattle implemented an ordinance known as Fair Share, establishing minimum compensation for rideshare drivers. In 2022, they followed up with another ordinance known as PayUp, which addressed food delivery drivers and took effect in January 2024.
While the measures were well intended, the results don’t please everyone, and many point out flaws in the legislation. It’s not just about how much Uber Eats drivers make in Seattle. The universe of gig drivers, gig platforms, policy decision-makers, and even Seattle restaurants are struggling for clarity and leadership.
This is where Gridwise Analytics prevails. We have real-time, ground truth data.
Here's what we cover:
The gig driving landscape in Seattle
The tension between gig drivers and the gig platforms in Seattle resembles many large cities, with disagreements between platforms and drivers about fair compensation. Added to this, however, is a city government that is concerned about workers’ rights and equity in the workplace. According to TheStreet, a personal finance blog, Seattle has a minimum wage of $19.97 an hour, the highest in any major US city.
The Fare Share Law
In 2018 and 2019, Seattle saw increasing pressure from rideshare drivers who were concerned about low pay and unfair deactivations. The City Council unanimously passed Fare Share in 2020. Provisions of the ordinance mandated that drivers receive compensation of at least $0.57 per minute, $1.33 per mile, and a minimum of $5.00 a trip. There were also requirements for sick pay and protections against unfair deactivations.
To offset increased costs in the wake of Fare Share, Uber raised prices by 24%, reported Pymnts.com.
Interestingly, the ordinance was implemented simultaneously with the COVID-19 lockdown, making it difficult to determine how it affected the rideshare business. What is clear from the graph developed by Uber for a piece in The Medium is that the Seattle rideshare business, like rideshare across the US, cratered at the beginning of the pandemic. Rideshare in Seattle, however, has recovered at a slower pace than the national average and has yet to reach pre-pandemic levels.
Source: Uber Under The Hood, Medium
The PayUp Law
The initial version of PayUp passed in 2022. As reported in the Seattle Times, the ordinance required gig platforms to compensate Seattle food delivery drivers at $0.44 a minute with a minimum per-mile amount of $0.74 while making a delivery or a minimum of $5 per order. The law applied equally to grocery delivery. Before the law took effect (but after it had passed), Shipt, the number two company in the grocery delivery market, suspended operations in Seattle with no comment on the reasons for the action.
Uber Eats and DoorDash added a $5 surcharge to Seattle orders, which they stated was necessary to maintain profit margins. They also warned that this would decrease order volume and driver income. DoorDash also responded by adjusting the suggested amount for tips in each order.
The following chart supplied by UberEats shows the aftermath of PayUp, with orders dropping almost 30%, starting when the law went into effect (signified by the vertical dashed line in early January 2024).
Source: Uber Under The Hood, Medium
Restaurants feel the effects of PayUp
Seattle restaurants are experiencing a drop in delivery business in the wake of PayUp, reports Geekwire. Uttam Mukherjee, co-owner of Indian street food restaurant Spice Waala, revealed that his restaurant experienced a 30% year-over-year decline in app-delivery orders this past January. In late February 2024, Uber Eats also reported a 30% decrease in food delivery orders.
Drivers are also feeling the effects of PayUp. The Geekwire article points out that although drivers make more per trip, the trip reduction means a lower net pay.
Carmen Figueroa, a veteran food delivery driver in Seattle and supporter of PayUp, told Geekwire, “I’m not making any more money.” She added that she’s getting fewer orders. Food delivery drivers all over Seattle report more pay-per-order but significantly fewer orders.
Drivers and allies call foul on price increases
Drivers and organizations allied with the drivers point to the $5 surcharge as part of a strategy the food delivery platforms use to prove that PayUp is a bad idea. As reported in another GeekWire article, nonprofit Working Washington, a previous PayUp supporter, said, “The new fees instituted by the delivery companies are a ‘clear attempt to distract from the fact that their business model is built on paying workers almost nothing while their CEOs and shareholders make millions.’”
Complicating matters even more, this past January, Uber released its earnings statement for 2023, revealing that for the first time, the company made a profit of $1.8 billion.
How can Gridwise Analytics data help solve the problem?
Developing a solution that is just and equitable to the gig platforms and drivers who make those platforms possible requires a clear picture of what is happening in the Seattle food delivery and rideshare market. Uber Eats, DoorDash, and the other gig platforms can and do provide data but often deny requests to look deeper into the information, citing proprietary concerns.
This leaves everyone with a clear need for accurate information so that legislation can reflect data-driven decisions.
Gridwise Analytics provides ground truth data on rideshare, food delivery, and grocery delivery activity. More than 500,000 drivers around the US, including in Seattle, use the Gridwise app to coordinate their gig driving activities by synching their gig platforms to the app. Gridwise Analytics anonymizes and aggregates the information from these drivers, turning it into raw data.
Gridwise Analytics can produce activity reports for specific dates and times, indicating increases and decreases in platform activity and driver earnings. It can also provide macro views of activity over a vast region and micro views of small market areas.
Precise, verifiable data from Gridwise means that all parties work from the same facts.
Gridwise provides comprehensive data on mobility and delivery services across the U.S., including food and grocery delivery. Data from Gridwise Analytics correlates up to 98% against quarterly metrics reported by the individual platforms.
Types of mobility and food delivery data from Gridwise Analytics
Comparing platforms
Gridwise Analytics can also compare order activity across various platforms for the same period, allowing decision-makers to see if policies affect all platforms similarly.
Gridwise Analytics can also view activity across platforms, allowing decision-makers to see if policies intended for one type of service, such as rideshare, affect food and grocery delivery.
In this case, the start of the PayUp Law is marked with a vertical black bar, giving viewers a clearer picture of its impact on activity before and after.
Driver earnings
DoorDash data can show how driver earnings break down over time, indicating how legislation and other factors affect base pay, bonus pay, incentives, and tips. Note again the vertical bar, indicating when PayUp went into effect.
How can this data be used?
Objective mobility and food delivery data, often called ground truth information, create a level playing field for all participants. As municipalities and other jurisdictions look to develop equitable regulations, they can use this data to guide their decision-making in several areas:
- Accuracy verification. By comparing data from individual parties with Gridwise Analytics, the information's accuracy can be verified, and conclusions can be based on factual data.
- Bias detection. News outlets may have certain biases that slant their reporting. Data from Gridwise Analytics provides an objective benchmark to identify and correct any potential biases or angles that the media might be promoting.
- Trend confirmation. Objective data allows all parties to identify food delivery and rideshare market trends. Are orders trending larger? Are they trending smaller? Are travel times getting longer? What areas of the city are generating rides or orders? Decision-makers can confirm or refute conclusions based on this and other data.
- Comprehensive analysis. Objective data allows for a more in-depth analysis, uncovering nuances and details that might not be evident otherwise.
- Policy impact assessment. It’s crucial to compare reported outcomes of new legislation (like Seattle's PayUp law) with actual data to assess the true impact of legislation on gig workers, gig platforms, and the economy.
- Market understanding. Objective data provides insights into market reactions that other sources may need to capture fully. This deeper understanding can guide strategic decisions for all parties in the gig economy.
- Crisis management. In times of crisis or controversy, the media can sensationalize events. A single comment from one driver becomes a story. Objective data helps all parties maintain a realistic stance. Responses reflect factual information.
- Data-driven decision-making. Objective data reinforces data-driven decision-making, ensuring reliable information guides strategies and actions.
- Trust. By demonstrating a commitment to factual data and transparency, all parties can agree on facts, paving the way toward equitable solutions.
Unbiased Data for Smarter Decisions
In over a decade, rideshare and food delivery have revolutionized transportation and dining habits, but this change comes with questions and challenges. Objective data is crucial as decision-makers develop solutions.
With access to Gridwise Analytics, companies gain a comprehensive view of mobility patterns across their competitive landscape. Regulators and researchers can explore pressing issues with robust, unbiased information. Municipal planners obtain insights guiding policies that support thriving gig economies and transportation systems optimized for the future.
Get in contact with our team to discover how Gridwise Analytics can sharpen your transportation and food delivery analytics.
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