Quantifying TNC Drivers’ Earnings in Massachusetts

An overview of quantifying TNC drivers'

Overview

In drafting this report, DLM requested data on the number of active drivers, as well as other critical data points such as driver earnings, from the TNC Division at the Department of Public Utilities (DPU). The TNC Division was unable to share this data, however, citing in its response Massachusetts General Laws (MGL) c. 159A1/2, § 8(e).¹²

In the absence of DPU data, DLM approximated the number of drivers by reviewing the number of TNC vehicle inspections from the state’s Registry of Motor Vehicles (RMV). The RMV provided data for the latest available 12-month period; from September 2022 through August 2023, 76,187 drivers had TNC vehicle inspections.¹³        

With regard to earnings, this report sourced data from a recent report from the Drivers Demand Justice Coalition, a grassroots coalition of unions and advocacy groups.¹⁴ While this report is from an advocacy group and relies on survey data, its results track closely with findings from TNC data from other states, as seen in a 2024 report commissioned by the Minnesota Department of Labor and Industry.¹⁵ Notwithstanding the closeness of this tracking, we would have preferred to use data from TNCs or different agencies of the Commonwealth that capture relevant information. This information was not provided to us, however, necessitating our reliance on a study that we believe provides a fair representation of the relevant data.

According to the Drivers Demand Justice Coalition report, the average Massachusetts TNC driver had a mean gross hourly pay of $25.11 and driving expenses of $12.29 per hour in 2023, resulting in an hourly net pay of $12.82. The report also lists the distribution of drivers by time worked, which is shown in Table 1 below.

Table 1: Distribution of TNC Drivers by Hours Worked per Week in Massachusetts (2023)¹⁶

	Hours per Week	Share of Drivers	Share of Trips
Casual Drivers	Less than 10 hours	50.7%	16.6%
Dependent Drivers	10 to 35 hours	36.6%	47%
All-In Drivers	35 or more hours	12.7%	36.4%

The Minnesota Department of Labor and Industry study, which relied on data provided by Uber and Lyft,¹⁷ found that a Minnesotan TNC driver’s average gross pay in 2022 was $22.03 per hour and the median gross pay was $21.04 per hour.¹⁸ This study classified the drivers into four categories by time commitment, with their distribution being very similar to the one provided by the Massachusetts Drivers Demand Justice Coalition report, as seen in Table 2 below.

Table 2: Distribution of TNC Drivers by Hours Worked per Week in Minnesota (2022)

	Hours per Week	Share of Drivers	Share of Trips
Casual Drivers	Less than 10 hours	45%	11%
Committed Drivers	10 to 20 hours	22%	20%
Highly Committed Drivers	20 to 32 hours	18%	28%
Full-Time Drivers	32+ hours	15%	41%

Given the most recent 12-month total of Massachusetts TNC vehicle inspections (76,187) and the reported average hourly rate of $25.11, it is possible to construct a broad range of TNC drivers’ total yearly earnings. For purposes of this analysis, we estimated that drivers work, at a minimum, an average of 5 hours per week and, at a maximum, an average of 40 hours per week. A middle of the road assumption at 20 hours per week is also offered. The following table delineates the resulting range of total yearly gross earnings for these three estimates (low-end, middle, and high-end estimates).

Table 3: Estimated Range of TNC Drivers’ Gross Earnings in Massachusetts (2023)

	Assumed Hours per Week (All Drivers)	Yearly Gross Earnings19	Total Yearly Earnings
Low-End Estimate	5	$6,278	$478,263,893
Middle Estimate	20	$25,110	$1,913,055,570
High-End Estimate	40	$50,220	$3,826,111,140

While the table above provides a wide range of earnings for all drivers, it is possible to use the driver categories from Table 1 (the distribution of TNC drivers by hours worked per week) to arrive at a best point estimate.²⁰ By using the same estimate of drivers from TNC vehicle inspections (76,187) and an hourly rate of $25.11, together with the aforementioned time distribution, DLM approximates that TNC drivers’ gross earnings in Massachusetts totaled $1.428 billion in 2023, as shown in Table 4.

Table 4: Best Point Estimate of TNC Drivers’ Gross Earnings in Massachusetts (2023)

	Hours per Week21	Annual Gross Earnings22 (per capita)	Share of Drivers23	Number of Drivers24	Estimated Total Earnings25
Casual Drivers	5	$6,278	50.7%	38,627	$242,479,793
Dependent Drivers	20	$25,110	36.6%	27,884	$700,178,339
All-In Drivers	40	$50,220	12.7%	9,676	$485,916,115
Total				76,187	$1,428,574,247

We believe this estimate to be conservative because the actual number of drivers is likely larger than the listed 76,187. Note that in 2023, there were 97,084 new applicants processed for background checks and 158,130 total background checks completed by the TNC Division at DPU on TNC drivers (see footnote 13). The main reason for the discrepancy between the number of DPU background checks and the number of TNC vehicle inspections is that this RMV process can be done within a year of a driver onboarding with a TNC. There are, however, many drivers who pass a background check, drive for a few weeks or months but never go through a TNC vehicle inspection. The estimated total earnings shown in Table 4 does not include earnings from drivers who have not obtained a TNC vehicle inspection.

All following sections use this conservative estimate of yearly TNC drivers’ earnings ($1,428,574,247) in order to compute potential lost payments to benefit programs.

12.     MGL c. 159A1/2, S 8(e): “Any record furnished to the division or other state agency by a transportation network company pursuant to this chapter including, but not limited to, the roster of permitted transportation network drivers, shall not be considered a public record as defined in clause Twenty-sixth of section 7 of chapter 4 or chapter 66.”

13.      Note that the number of TNC drivers can be estimated either by looking at TNC vehicle inspections, which tend to be renewals, or by the number of background checks, which are completed by prospective drivers on sign-up. We obtained the number of TNC vehicle inspections from the RMV, as well as the number of background checks from the TNC Division at DPU. Background checks represent a far higher number: In 2023, there were 97,084 new applicants and 158,130 total background checks completed, while in 2022 there were 78,683 new applicants and 122,741 total background checks completed. There is no way to know from the available data how many applicants do in fact become drivers after sign-up. Consequently, this report uses the more conservative estimate, obtained from the number of TNC vehicle inspections.

14.      Drivers Demand Justice Coalition (2023). The real economics of ridehail work: What it's like to work for Uber and Lyft in Massachusetts. Big Lake Data.

15.      Parrott and Reich (2024).

16.      Driver Demand Justice Coalition (2023), p. 10, categorizes drivers: Casual drivers work less than 10 hours, Dependent drivers work 10 to 35 hours, and All-In drivers work 35 or more hours per week.

17.      “This study analyzed extensive data provided by Uber and Lyft about more than 18 million Minnesota transportation network company (TNC) trips and driver earnings for all of 2022.” Parrott & Reich (2024), p. 8.

18.      Parrott & Reich (2024), p. 9.

19.      The amounts in this column were calculated assuming 50 work weeks per year. This assumption accounts for vacation time, holidays, and sickness. Example: 5 hours/week * $25.11/hour * 50 weeks/year = $6,277.50 earnings/year for casual drivers. Note that a less conservative estimate of 52 work weeks per year could also be made.

20.      The “best point estimate” is the single point value DLM determines to be most reasonable given the data from our analysis from the estimated range of total yearly earnings in 2023.

21.     These represent assumptions made by DLM. DLM does not have discrete data on the actual hours worked for each category beyond the estimates of the aforementioned report from the Drivers Demand Justice Coalition.

22.     The amounts in this column were calculated assuming 50 work weeks per year. This assumption accounts for vacation time, holidays, and sickness. Example: 5 hours/week * $25.11/hour * 50 weeks/year = $6,277.50 earnings/year for casual drivers. Note that a less conservative estimate of 52 work weeks per year could also be made.

23.     The percent of drivers per category is taken from the aforementioned Drivers Demand Justice Coalition (2023) report.

24.     Using the above estimates, the average Massachusetts TNC driver works 14.93 hours per week.

25.     Note that decimals have been omitted to improve legibility, resulting in a small discrepancy in the resulting totals. E.g., the precise computation for the first line is $6,277.50 * 38,626.81 = $242,479,793.50.

Date published:	April 30, 2024