Uber passengers tip drivers less often than taxi passengers – and 60% NEVER TIP at all
- Only one percent of Uber passengers always tip their drivers, a new study says
- 60 percent of people who ride in an Uber never tip their driver
- Male passengers give the biggest tips to women drivers
A new study from the National Bureau of Economic Research reveals a shocking finding about Uber passengers: Most of them are profound cheapskates.
Only one percent of people who use the ridesharing app always tip, while about 60 percent simply never tip their drivers.
The study, which examined data from more than 40 million trips taken over the course of four weeks, found only about 15 percent of trips are tipped.
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60 percent of Uber passengers never tip their drives, while only one percent always left a tip, according to a new study from the National Bureau of Research
The study was co-authored by John List, Uber’s former chief economist who currently works for Lyft.
For the 39 percent of people who tip but not always, the data showed an average of one tip every four rides.
‘I think Uber drivers are tipped less than taxi drivers because tipping happens after the ride is over and not face to face,’ co-author Uri Gneezy of University of California San Diego told The Verge.
‘In a sense, I think that this is the right way. Riders don’t tip automatically, but only if they are happy with the service. Hence, tips provide incentives to drivers.’
The study also found some gender division in Uber tipping habits.
Men are 23 percent more likely than women to tip their drivers, and men gave slightly larger tips to women drivers than men, an average of 12 percent compared to 11 percent.
After years of criticism, Uber added the option to tip in 2017 as part of their ‘180 Days of Change program’
Uber had resisted adding a tipping feature for years, before finally adding it as part of its ‘180 Days of Change’ program in 2017.
The company attempted to explain its policy by saying it wanted its drivers to know they were all paid according to the same rates and rules.
By allowing rider tips, the company would no longer be able to control those fair standards of pay.
The company also worried drivers would adapt by avoiding neighborhoods where tipping was less common, creating coverage imbalances.
Drivers earned an extra $50 million in the first month after Uber introduced the tipping option.
A 2018 study from MIT found two-thirds of Uber drivers earned less than minimum wage from the ride sharing app.
Uber disputed the findings and said the per-hour pay was $13.04.
Researchers countered this figure didn’t take into account expenses, maintenance, self-employment taxes and other work-related costs riders had to pay.
WHAT IS UBER’S ‘180 DAYS OF CHANGE’?
After the departure of CEO Travis Kalanick in June, Uber launched a ‘180 Days of Change’ initiative to improve the driver experience.
For the first phase – focused on earnings – the company deployed an in-app tipping option.
So far, drivers have collected $50 million in tips in about a month.
Lyft – which has had in-app tipping for years – only hit $250 million in tips last month.
Next, Uber rolled out 24/7 support for drivers – 200,000 calls to the line have been made in less than 30 days.
For the third phase of the initiative, Uber is focusing on driver flexibility.
Uber launched its ‘180 days of change’ initiative in October as part of its effort to improve the company’s relationship with drivers. It first introduced tipping for drivers
Drivers can set up to six destinations per day, meaning Uber will only offer rides along that route.
This will allow drivers to do pickups on their way home or to other personal destinations without ending up in destinations out of their way – previously drivers could only set two per day.
Uber also enacted new waiting time charges that will be applied to users who keep drivers waiting at the start of a journey.
Next, Uber will give drivers more flexibility when it comes to what types of pickups they want – they can select just UberX and no deliveries, for example)
The firm will also start notifying drivers if a ride will take more than 45 minutes so they can decide if they want to take a long trip.