How Much Does an Uber Driver Make in New York City?

How Much Does an Uber Driver Make in New York City?

It seems that many people in New York are seeking their own small business, along with the independence and better income that may give

We know this because we see just how many have signed up to become licensed Uber drivers. Driving your own taxi as an independent contractor on the Uber platform is seen as a fast way to better work-satisfaction by an awful lot of folks. In fact, the ride-hailing app has been so successful in attracting new drivers, that in 2018, stating a need to cut vehicle congestion, the city of New York placed a moratorium on the issuance of new for-hire vehicle (FHV) licenses in a bid to quell the numbers.

Currently, the only new FHV licenses being issued are for drivers offering wheelchair-access vehicles to riders. However, for those who managed to get in before the cap, how much do they make by driving the streets of the Big Apple?

Firstly, it is important to know how the cost of a ride is calculated. In New York, Uber charges the rider the journey fare, (time and distance), plus a Base Fee and with a Minimum Fare. Uber X, the platform’s basic and most popular class of ride is currently priced at zero Base Fee, $1.62 per mile, $0.74 per minute, with a Cancellation Fee of $5 and a Minimum Fare of $8.

According to labor group IDWU and website Alvia, Uber takes a 20% cut of each fare in NYC.

IDWU states that New York Uber drivers generate an average fare per ride of $25.91 and they complete two rides per hour. This equates to a gross hourly rate of $51.82. Most drivers are reporting 30 hours behind the wheel, which gives a weekly gross income of $1,554 – or $80,839 per year. Not bad. However, this sum shrinks as Uber takes their share and the driver must pay for fuel, licensing costs, insurance and vehicle maintenance. Depending on the car being driven, fuel and running costs can vary wildly. Insurance is often around $5,000 per year but this will depend on driver history. (Also factor in the downtime when the driver cannot work while they wait for insurance renewals to come through – a very slow process that can be made significantly faster using the mobile FHV app from INSHUR).

Estimates put fuel costs at 10% and vehicle maintenance at another 5% of each fare. Deduct these, plus Uber’s 20% and the average hourly rate for drivers drops to $33.68 – before licensing and insurance. $33.68 over a 30 hours week gives a gross annual income of $52,545. Still not too shabby.

A final estimate, after factoring in $5,000 for insurance and another $2,000 for licensing and other document costs puts the gross annual income at $45,545, or $29 bucks per hour. Almost double the city’s minimum wage and well above the new driver minimum wage introduced by the NY Taxi and Limousine Commission (TLC) in January this year, which stands at $17.22 per hour.

As independent contractors, Uber drivers currently do not get holiday or sick pay, but this is in the process of review by TLC. Drivers can also make significant cost-of-doing-business deductions on their 1099 tax return each year.

So there you have it. Drive for Uber in NYC, put in a 30 hours week to your own schedule and you could make an average of $29 per hour.

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For most side hustlers, Uber is worth it. But alternatives to driving with Uber are on the rise. Finally how much is Uber worth depends from your ability to be a successful driver.

Your earnings are a result of smart work and strategies to save money.

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What Taxes Do Uber Drivers Pay?

Unless stated otherwise in your local laws, Uber drivers are treated as independent contractors by the Internal Revenue Service (IRS). This means that taxes won’t automatically be taken out of your income and that it is your responsibility to declare your earnings and settle any tax bills.

Uber usually helps out its self-employed drivers by providing them with a tax summary and, when applicable, a 1099-K tax document to fill out and send to the IRS.

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How Much Does Uber Take From Your Pay?

Drivers don’t get to keep all of the money a rider pays. Uber takes 100% of riders’ booking fees. Then, Uber takes a 25% cut from each fare. Drivers keep 100% of tips and bonuses. In the Uber driver app, you can exactly how much you’re earning vs. what Uber’s earning.

What Affects How Much You Can Earn by Driving for Uber?

Signing up for Uber doesn’t guarantee you the average 2020 wage of $17.21 to $19.89 per hour. How much you earn depends on the following:

How Far You Drive Per Ride

Part of your fare earnings is based on how many miles you’re driving and how long you’re driving. Longer trips bring in a bigger fare.

Where You’re Driving

Drivers earn different amounts based on where they’re driving. For example, if you drive in big cities or do airport runs, you can expect to make more than a driver working in a smaller suburb.

What Service Tier You Work In

Uber offers many service tiers. Not every tier is available in every location. Drivers with nicer cars that can hold more people enjoy higher rates than drivers who participate in UberX, which is the cheapest service tier for riders.

  • UberX: most affordable rates for 1 to 3 people
  • UberXL: affordable rides for groups up to 5
  • Uber Select: stylish rides for 1 to 4 people with highly-rated drivers
  • Uber Comfort: newer cars with more legroom
  • Uber Pool: shared rides, discounted rate per rider
  • Uber Black: premium rides in luxury cars
  • Uber Black SUV: premium rides for 6 in luxury cars
  • Uber LUX: top-rated drivers in luxury vehicles
  • Uber WAV: wheel-chair accessible vehicles
  • Uber Green: sustainable rides in electric vehicles
  • Uber Taxi: local taxi cabs

Surge Pricing

Uber uses an algorithm to detect rider demand and driver availability. When rider demand is high and driver availability is low, Surge Pricing goes into effect to incentivize drivers to give rides. Drivers earn the normal rate for rides multiplied by a surge price multiplier.

During times of Surge Pricing, drivers see what the multiplier is in the app. For example, when SURGE is at 2.5x, a ride that’s normally $10 would be $25.

Tips

As noted above, tips added an average of $1.31 per hour to a driver’s 2020 hourly wage. Being more personable and supplying extras like mints or tissues are ways Uber drivers can increase their chances of getting tips.

Is Working on Uber Worth It?

Working on Uber is worth it if you want a flexible job that allows you to be your own boss. Uber driving does not require as much capital as other businesses. To drive for Uber, you do not need a university degree. Even if you don’t own a car, you can hire one from Uber for as little as $250 per week. You can eventually buy a car if you have a steady source of income.

5. The Best Car To Drive For Uber

In addition to what we said about the Uber pay, you should know that Uber driver salary depends on the type of car driven. Working as an Uber driver with a luxury car will be paid differently than a normal car you see swarming the city streets on any given day.

The minimum fare you make for a XL goes up quicker compared to UberX. In addition with Uber XL you generally get a better quality of clients that tip better than UberX riders.

According to the U.S. News and World Report the list of the best cars for Uber and Lyft Drivers in 2020 includes:

  1. Toyota Camry Hybrid version
  2. Toyota Camry
  3. Honda Civic
  4. Honda Accord Hybrid version
  5. Honda Accord
  6. Mazda6
  7. Ford Fusion
  8. Honda Insight
  9. Ford Fusion Hybrid version
  10. Volkswagen Jetta
  11. Subaru Legacy
  12. Subaru Impreza

So, is Uber profitable for drivers? Even if you do not have the right car, by using our money gas saving tips and keeping a diligent track of your miles, you can boost your driving income.

Indeed as a rideshare driver, your biggest tax deductions will be the costs related to your car.

Average Earnings đź’°

Based on our data*, drivers can look to earn between ÂŁ15 to ÂŁ20 on average by driving Uber. See below for how this works out for part-time vs. full-time drivers.

Part-time 

Work HoursAverage Weekly EarningsAverage Monthly EarningsAverage Yearly Earnings 
Around 20 hours per weekÂŁ300 – ÂŁ400ÂŁ1,260 – ÂŁ1,680ÂŁ15,600 – ÂŁ20,800

Full-Time

Work HoursAverage Weekly EarningsAverage Monthly EarningsAverage Yearly Earnings 
Around 45 hours per weekÂŁ675 – ÂŁ900ÂŁ2,835 – ÂŁ3,780ÂŁ35,100 – ÂŁ46,800

Some Additional Points 

1.) *These figures come from Uber’s official statements, interviews & surveys with our own drivers, and online testimonies.

2.) Please keep in mind that these numbers are averages. There is a potential to earn less than this, but also to earn more based on where, when and how you drive.

3.) These earnings are before tax, and also before you take out your general running costs. To find out more about these then please keep reading!

Uber’s Pay Structure

Uber’s pay structure is dynamic and flexible. It is calculated according to location, time of day and frequency of work. Pay may vary on a day-to-day basis.

Uber provides “earnings estimates” instead of a set wage to help drivers identify their likely profits. These should be viewed strictly as projections. They are based on what other drivers working the same hours in the same location earned over the previous month.

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Qualifying Earnings

Uber drivers earn from a combination of factors including customer tips and trip fares. Occasionally things like Quest promotions may lead to additional earnings.

What Is a Base Fare?

The base fare is the flat rate that a pick-up pays. Time and distance increase the trip fare.

Does Surge Pricing Affect Drivers?

Uber uses surge pricing when demand is high, increasing the costs of rides. Uber drivers can use a local map to find surge prices and time their availability. This can increase earnings.

Make Your Money Work Better for You

Cancellation Fees

Drivers are protected if a ride is canceled while they are en route to pick-up. They will receive a cancellation fee.

How Do You Qualify to Be an Uber Driver?

There are a few basic requirements that you’ll need if you want to sign up to become an Uber driver. You must meet the minimum age to drive in your city and have at least one year of driving experience (or three years if you’re under age 23). You also must have a valid driver’s license and an eligible vehicle with four doors. Moreover, when you sign up, you’ll have to provide the company with proof of residency, proof of insurance, and registration, as well as a profile photo.

How much does a Driver make at Uber in California?

Average Uber Driver yearly pay in California is approximately $26,236, which is 49% below the national average.

Salary information comes from 199 data points collected directly from employees, users, and past and present job advertisements on Indeed in the past 36 months.

Please note that all salary figures are approximations based upon third party submissions to Indeed. These figures are given to the Indeed users for the purpose of generalized comparison only. Minimum wage may differ by jurisdiction and you should consult the employer for actual salary figures.

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How Much Do Uber Drivers Actually Make?

Uber’s pay structure factors in several variables: base fares, tips and other incentives. Calculating a realistic average is difficult. However, according to recent studies, most Uber drivers earn about $8 to $12 per hour.

Make Your Money Work Better for You

Ufuoma Ogono

About the author: Ufuoma is a veteran freelance writer whose work has also appeared in Smartereum, Cyber Jam Limited, and Binance. Her goal as a content writer is to help readers chase their careers in technology and follow their dreams. Ufuoma attended of Delta State University, where she earned her BSc in Sociology and Psychology.

Frequently Asked Questions

Here are a few questions people ask about driving for Uber.

Is Uber meant to replace a full time job, or supplement income as a side hustle? It’s fair to say that, for most Uber drivers, a job with Uber has to be a supplement to a salary they earn elsewhere. There simply isn’t enough consistency for the typical Uber driver to make enough money to sustain themselves with Uber alone. So, many Uber drivers are only part-time drivers.

But, drivers who operate full-time in a dense urban area, and optimize their trips by supplementing their time behind the wheel by providing other Uber services can certainly earn a respectable income.

At that point, they are working a full-time job but don’t receive the benefits that other full-time workers enjoy.

For instance, you will not receive any paid time-off or sick leave working for Uber.

How much Uber drivers make by using the platform is up to them, but the ancillary benefits of full-time employment are not attainable as an Uber driver, as you are not an employee of Uber.

How long does it take to make 100 Uber trips? That depends on how buys your operating area is and how much you are working. If you are operating in a densely populated urban area, it’s quite possible you could complete 100 trips in a week to ten days, depending on the number of hours you work. But, if you are in a more rural setting, with longer rides for each trip, or you don’t work many hours consistently, it will take much longer to complete 100 trips.

Can you make $1,000 in a week with Uber? You can. But, you might be the exception to the rule. Most Uber drivers do not make that kind of money. But, by keeping in mind Uber’s payment structure, targeting times where your trips are eligible for surge pricing, and providing quality service that earns tips from your passengers, you can drive your earnings higher.

There are a great many factors that can make it easier (or harder) for full-time drivers to earn money with Uber.

It’s up to you to tailor your efforts to maximize your wages.

How Uber Commission and Fees Work

It’s not that difficult to understand the way Uber fees and commissions work.

For instance, when it comes to fees, the passengers are the ones who have to pay a booking fee, as well as per minute and mile fee for their ride. After the ride, you as a driver would be paid the majority of the fare you made. And you only get “the majority” and not all of it because Uber is going to get their cut, respectively the “Service Fee”.

More than 25%

The amount that Uber says it charges their drivers is 25%, but it actually takes a little more than that from their earnings. This is all due to the fact that some additional fees are taken by rideshare companies, resulting in a higher percentage for the cut.

In the past, Uber drivers had to drive around 2.36 miles to make $10 before fees, but nowadays, the prices were lowered by Uber. As a result, a driver will have to drive 4.71 miles to make the same amount of cash.

Fees

Also, there is the booking fee and a safe rides fee for every Uber ride, which is between $1 and $3. These fees vary by city, but the driver cannot actually see these in their bank account, as this goes directly to Uber.

So, the commission taken by Uber is higher if the ride fare is lower, meaning the rideshare drivers would make less. So, in the end, even if Uber claims to take 25% of its drivers, it will actually take up to 42.75%. If you are doing short rides, then it won’t be too profitable for you.

>> Read More: Loans for Uber Drivers

Maximizing your Uber driver pay

Sound driving strategies include all the above tips about earning more, but there’s another side to the equation. You not only want to make as much money as possible; you also need to hold on to what you earn. The key to this is limiting your expenses. Most gig driving expenses are hard to eliminate, but they can be minimized. Here’s a short list of the major costs of driving and suggestions for how to keep them down.

Gas

The cost of gas is something you can’t control, but you can surely take advantage of effective ways to save at the pump. Gridwise Gas is an excellent way to slash your gas expenses. Sign up for free and get easy access to discounts at service stations near you. Your Gridwise Gas Card card will be accepted at 95% of the places you stop to fuel up.

Maintenance

You depend on your car to make a living, so giving it good maintenance is not an option. The problem is, upkeep isn’t cheap. You probably have found this out, especially if you drive an older car. Breakdowns and repairs become more common the longer your car is on the road, especially when you’re piling up the mles with your driving gig.

Gridwise has two ways to keep your maintenance costs down:

Gridwise + CarAdvise: Wouldn’t it be great to check out different auto shops, talk to different experts, compare prices, and schedule your car’s service appointment online? With Gridwise + CarAdvise, you get that—plus discounts of up to 40% on maintenance and repair services.

Gridwise Auto-Buying Program:Okay. You’ve had about enough of nurturing your car into its older age, and it’s time to buy a new one. You’re in luck! With the Gridwise Auto-Buying Program powered by TrueCar, you’ll search for the vehicle you want, compare prices, and save big. You could wipe off as much as $3,500 from the MSRP and find great deals on used vehicles, too. 

Depreciation

This is one of these expenses you don’t necessarily notice—until you do. Depreciation slashes the value of your vehicle, just because you’re driving it. When you use your car for Uber driving, this cost can skyrocket. AAA estimates that depreciation contributes to 40% of all the costs of owning a vehicle. How can you make this hurt a little less?

Use Gridwise to treat your Uber driving gig for what it is: your business! Gridwise is a great Uber mileage tracking app, but it does so much more. With Gridwise, you can

  • track all your expenses
  • keep tabs on your earnings
  • make note of your profits and losses
  • see which routes make you the most money

See? You might have thought Gridwise was just another mileage tracker for Uber drivers, but with these and other features such as airport and event info, weather and traffic alerts, plus When to Drive and Where to Drive, you can see why Gridwise is the world’s best rideshare and delivery assistant. 

Now that you know the different things that it involves, is driving for Uber worth it in 2022? You can make sure it’s worth it when you use Gridwise.

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