JP Morgan: Gig Economy Transportation Workers Earning Half Of What They Did 5 Years Ago

The gig economy – where people work through transportation apps available online, is not doing well in the United States.

A new study conducted by the JP Morgan Chase Institute claimed that those employees such as drivers who used online apps of companies like Uber or Lyft or of Uber Eats or Postmates earned 53 per cent less in 2017 compared to what they had earned on an average in 2013. Online gig economy payment into Chase checking accounts is looked after by the JP Morgan Chase Institute.

For those people who worked for a transportation app in a given month in the US saw their average monthly income drop from $1,469 in 2013 to $783 in 2017, the report said. On the other hand, there was an increase in income of 69 percent at $1,736 on a monthly average for those people who were working for leasing apps such as those of Airbnb, Turo, Parklee and other apps which allow users to rent physical things such as a home, or a car or a parking space.

The report noted that one of the reasons for this is the growing popularity of online gig work which can be attributed in turn to the increase in the number transportation jobs.

The report also noted that the percentage of the total population that was involved in earning money from the gig economy in the US at any given point in time throughout a particular year – in this case 2018, saw an increase of 3 per cent to nearly 5 per cent in 2018 compared to just less than 2 percent in 2013. That percentage is almost the same as the number of US citizens who are employed in the public administration sector.

Of the 5 per cent, the report noted that about 2.4 per cent of the workers participated in the online transportation jobs this year which is just a small increase compared to the figure in 2013.

The report also highlighted a number possible and potent factors that the average pay for gig economy drivers has slid overt he recent years. The JPMorgan said that it could be because of one or a combination of more than one of the factors.

These include drivers working fewer hours on an average, demand increase not matching with the increase in the number of drivers, fall in trip prices and lower pays to drivers by online platforms.

“The study’s findings reinforce what we and many others have said for some time: That the growth in on-demand work is driven, in large part, by people who use platforms like Uber on the side,” the Uber spokesperson said. “Given the growing share of people who use platforms like Uber only occasionally, a more appropriate metric to focus on would be average hourly earnings, which have remained steady over time,” a spokesperson for Uber told the media in reference to the JP Morgan report. .

Uber’s biggest rival in the US, Lyft, also echoed similar sentiments about the report. “The fact that this study did not examine hourly earnings, the metric that drivers care most about, has resulted in misleading headlines,” a Lyft spokesperson to the media.

(Adapted form Recode.com)

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Categories: Economy & Finance, Strategy, Sustainability, Uncategorized

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