MIT researchers estimated median Uber driver profit at $3.37/hour

Four researchers associated with the MIT Center for Energy and Environmental Policy Research studied Uber drivers earnings. Based on drivers’ responses to a survey, the researchers estimated that the median driver earned $3.37 per hour before taxes, and 74% earn less than minimum wage in their respective states. Net of vehicle expenses, 30% of drivers are losing money driving for Uber.

The authors also studied the impact of deductions on taxation of driver earnings. Based on IRS rules about deductability of vehicle expenses, the researchers estimated that 74% of driving is untaxes (because deductions exceed driver earnings).

Uber’s chief economist responded by questioning the researchers’ methodology, including survey questions, driver understanding, and possible errors in analysis. Uber CEO Dara Khosrowshahi responded on Twitter: “MIT = Mathematically Incompetent Theories (at least as it pertains to ride-sharing).”

After criticism, lead author Stephen Zoepf offered a statement agreeing that alternative methods of calculating revenue and profit yield higher profit to drivers, and planning a revision of the paper with this principle in mind. Zoepf also called on Uber to provide more data about driver profits net of vehicle costs and to distinguish actual and tax-reportable vehicle expenses in order to clarify driver true economic profit versus tax subsidies.