Uber and Lyft are the go-to rideshare companies for both riders and drivers in the United States. In fact, many drivers have been happily working for both of them for years.
Unfortunately, the pandemic created a sudden and significant drop in ride demand, forcing many drivers off the road. Although both companies were affected, Uber seems to have salvaged the situation, primarily by doubling down on Uber Eats to keep its drivers busy.
However, with drivers not coming back to work and no alternative service, Lyft is struggling to keep up.
To stay afloat, the company has made some notable changes for 2021 — but are these measures enough to make Lyft a viable option for drivers again?
Where did all the drivers go?
There isn’t a single issue causing the driver shortage. It’s a culmination of several external and internal factors.
Lyft’s business is primarily focused on ride-hailing, which saw a slump during the pandemic. The company’s ridership was down by 75 percent last year, while delivery jobs on other platforms have seen a spike in business during the same period.
Since drivers can easily switch platforms, many have understandably left for greener pastures. As the economy continues to reopen, however, rideshare business is on the rise again – but Lyft doesn’t have enough drivers online to meet the demand.
Additionally, internal factors have caused many drivers to leave and refuse to return to Lyft.
Drivers cite a lack of transparency in earnings, deteriorating support, poor surge pricing, and declining incentives and rewards as some of the reasons to stay away.
Lyft drivers, and also Uber drivers, went on a 24-hour strike in July this year to air their grievances.
In contrast, DoorDash, Instacart, and other delivery apps have fared well, attracting more and more drivers.
How much are Lyft drivers making?
Lyft doesn’t guarantee minimum earnings, but the company does promise to provide drivers with a dependable and worthwhile opportunity.
In a blog post in 2018, Lyft’s Laura Copeland stated that drivers’ median earnings were $29.47/hour nationally and $31.18/hour in its top 25 markets.
It’s worth noting, however, that these earnings were calculated by considering only the total time spent in driving to a passenger and heading to their destination. It doesn’t include time spent waiting for requests. Once the waiting period is added to the mix, the median earnings drop to $18.83/hour nationally and $21.08/hour in the top 25 markets.
Lyft hasn’t published any recent data, but we analyzed the earnings of over 100,000 Gridwise drivers to get you the numbers that matter.
Lyft Bets Big on Bonuses
Both Uber and Lyft have taken big steps to get enough drivers back on the road to match the growing demand.
Lyft spent over $550 million in driver incentives in the first half of this year and yearly spending is expected to exceed $1 billion.
What else is Lyft doing to get drivers on the road?
Apart from increasing incentives, Lyft is also trying to address other complaints raised by drivers in the past. As part of this process, the company made some promises:
- Long pickup bonuses are live in six markets;
- Drivers can unlock the ability to see passenger destinations before starting a ride;
- The option for drivers to see trip details and earnings before accepting a ride is in testing in select markets.
What to do if Lyft isn’t right for you
Fortunately, there are plenty of options, and a lot of them are also offering great bonus opportunities.
- Uber: Uber’s main advantage is its multi-service platform that allows drivers to switch to food delivery if ride demand slows again.
- Instacart: Instacart specializes in delivering groceries from nearby stores and has seen a huge spike in demand over 2020 – and the demand is expected to last. It’s a good option for drivers who are uncomfortable with sharing their car with strangers during the pandemic.
- DoorDash: DoorDash trips are shorter and deliveries can be made without a car.
- Amazon Flex: Flex is Amazon’s delivery platform for gig drivers and allows drivers to deliver Amazon Fresh, Prime Now, Whole Foods Market, and Amazon.com orders.
- GoLocal: A white-label delivery service from Walmart, GoLocal caters to businesses of all sizes and promises a greater variety of merchants than competing apps.
Is it worth driving for Lyft in 2021?
According to a study by Rakuten Intelligence, the cost of a ride increased by 92 percent on rideshare apps between January 2018 and July 2021 due to the shortage of drivers. As of July 2021, Uber and Lyft were operating 40 percent below their usual driver capacity.
We believe it is worthwhile to drive for Lyft right now. The driver shortage is creating long wait times and high prices that aren’t sitting well with riders.
So Lyft is willing to spend billions of dollars in incentives to get drivers back on the road – and that’s money that could be in your pocket.
With the increased incentives, Lyft drivers in select cities are making at least $40/hour even when the waiting time is included. That’s not a bad gig, even if it is temporary.
Earn more anytime with Gridwise
We’ll never take incentives away for drivers that drive with Gridwise! The #1 gig-driving assistant pulls together all your driver data, so you can see exactly how much you’re earning at a glance, all in one centralized location.
Plus, you’ll get hooked up with driver offers and plugged into an engaged community to take your earnings to the next level. So download the app today and get the most from time on the road all year long.
