Earnings for an Uber driver are calculated based on the standard fare per ride. Beyond the standard fare, there are a few other elements to Uber’s pricing that you should be aware of: minimum trip earnings, cancellation fees, and surge pricing (more on that later).
How Much Does An Uber Driver Make On Average?
According to Indeed Canada, the average Uber driver’s pay works out to be $29.28 as per data collected within the past 3 years. However, it’s important to remember that you are an independent contractor when you drive for Uber, so keeping track of and filing your income taxes is entirely up to you. And, with that, this hourly wage reported by Indeed is before taxes.
After accounting for taxes, it’s important to think about your other related expenses as a sole contractor. This includes vehicle expenses such as gas, maintenance and inspections. After this, you can confidently expect anywhere from $10 to $20 per hour of driving. To make the most of this range, experiment with different driver strategies, including your schedule (days and times of day on the road) and your customer service tactics.
It’s also important to consider the competition in your area since this directly affects the number of customers that you will have easy access to. If you live in a high-density area and have personally found it difficult or slow to find a driver, it’s highly likely that you will be able to find consistent opportunities for rides.
Here's a realistic example of what you can earn in one day driving for Uber.
How Much Do Uber Drivers Make Per Ride?
Earnings are calculated based on your trip fares and are paid out after the Uber service and booking fees. Fares are calculated based on time and distance of the requested ride, and also factor in other standard fees such as the base fare, booking fee and any surge pricing that might occur (more on surge pricing later).
According to Ridester, Uber can take as much as 42.75% from a minimum fare ride in San Francisco. For example, this would mean that a $8.30 fare would then mean $5.08 in the driver’s pocket. Of course, every tier of Uber’s service offerings from UberX (the base level) to UberBLACK (one of the highest tiers) translates to different earnings since the fares are priced according to the luxury of the tier. It’s also important to note, however, that fares and Uber’s commissions vary based on city, so it’s important to dive deeper into the specifics of your market pricing.
With Uber, there’s also an hourly rate guarantee which, once you qualify, ensures that you will make a level of income that you would expect. This hourly rate is prorated, meaning that if you drive for 30 minutes, you will get half of the hourly rate guarantee. For more information on the hourly guarantee, visit Uber here.
Increasing Your Income
On top of your cut from trip, fares are any tips that you make throughout your rides. Knowing this, it can be incredibly valuable to think about ways to deliver exceptional customer experiences to your riders. Some ways to increase your chances (and amount) of tips include:
- Keep your car as clean and pleasantly scented as possible
- Make good, engaging conversation
- If asked, offer good recommendations for places around the city
- Know the most commonly needed amenities (e.g. restrooms, convenience stores, etc.)
Promotions as an Uber driver allow you to make the most of your earnings once you’ve achieved certain milestones. These can be based on your ratings and number of trips. Your upcoming promotion milestones can be viewed in the Uber app in the Promotions tab. This section will tell you the date, time, and amount of each guarantee that you are headed towards.
A special aspect of Uber’s pricing model is that it varies depending on demand for drivers. This is what is called surge pricing, which is a valuable way to boost your income if you take advantage of it often enough. In terms of payment, surge pricing works exactly the same as normal fare pricing, but simply incentivizes drivers to connect with riders during times of high need and special occasions. For example, surge pricing often occurs downtown during late-night times as a result of higher traffic from those out for dinner or drinks.
In addition to surge pricing, you can easily take advantage of high traffic times and areas to make the most of your time on the road. This means that you can plan your day around typical lunch and dinner hours, as well as rush hour needs. Vibrant areas of the city are another place to maximize the number of trips during your day.
