Seattle-area demand for Uber, Lyft still not back up to speed, an outlier in the US

It used to be that Mohamed Gahayr could earn close to $200 in four or five hours of driving for Uber and Lyft. The turnaround between dropping one person at the airport and picking another up was almost immediate. Some days, he’d have to turn off the app to catch a few minutes for lunch or a break.

Gahayr hasn’t seen days like that in two years, as the market for ride-hailing services in Seattle and King County has struggled. To earn the same money today, he works almost twice the hours, often forgoing days off. He never closes the app anymore and even at the airport finds himself waiting 20 or 30 minutes in the parking lot.

“It’s time that you’re supposed to be with your family,” he said. “Time that you’re supposed to be doing the things you love.”

If it feels to Gahayr and his fellow Seattle-area drivers like the passengers haven’t returned, it’s because they haven’t. In the first quarter of 2022, drivers for Uber and Lyft provided around 3.3 million rides in King County, according to data provided by the Seattle Department of Finance and Administrative Services through a public records request. That’s just 36% of the companies’ combined 2019 peak of 9.3 million rides.

Trips have rebounded some from the depths of the pandemic, when the region saw only 1.3 million rides in the second quarter of 2020. But for most of 2021 and into 2022, trips have plateaued.

“I think it’s pretty clear that rides have not recovered to their pre-pandemic level,” said Beth Gappert, division director of consumer protection at FAS. “We’re up a little bit, but they’ve been pretty steady for a period of time.”

The anemic numbers tell a story about the halting return to normalcy for a metropolitan area defined in large part by the tech industry. The companies also contend that new minimum wage requirements in Seattle are depressing ridership, a claim disputed by others.

Many drivers in King County and elsewhere in Washington appear to have stopped working for Uber and Lyft altogether, a nationwide issue for the companies that threatens to fray their coverage. In 2021, King County issued 12,285 ride-hailing permits to drivers, according to the King County Records and Licensing Services Division. In 2019, that number was roughly 80,000; in 2018, it was nearly 90,000.

Those who remain are competing for fewer passengers. Takele Gobena, a SeaTac city council member and field organizer on behalf of drivers, said he hears from drivers that tech workers, who used to be their most consistent and lucrative passengers, are still absent.

“Those are the workers that take long trips into downtown Seattle,” he said. “We hear from drivers who’ve been in the business five years, eight years, 10 years. They know where they pick up people and drop people off. It’s like, ‘Oh, we’re missing tech workers.’ †

At the same time, the number of active taxicabs in King County was down to 351 at the end of 2021 from 1,108 in 2018 — a 68% drop that began in 2019, before the pandemic, and has accelerated since the first shutdowns of 2020, according to King County’s Records and Licensing Services Division.

Both Uber and Lyft tend to be protective of ridership specifics; in Washington, it took the state Supreme Court to say their Seattle-based data is not exempt from the state’s public records act.

A spokesperson for Lyft declined to explain how Seattle’s ridership compared to other locations, saying the company does not disclose “market specifics.” A spokesperson for Uber, however, said “the low trip numbers in Seattle are far outside the norm.”

“Overall the city is experiencing one of the slowest rebounds in the country,” said the spokesperson

The slow rebound threatens to hurt the companies’ promise of on-demand rides, delivered quickly.

“One of the things we know is that systems like this work better when you have a thicker market, when you have higher density of demand,” said Don MacKenzie, associate professor of civil and environmental engineering at the University of Washington and head of its Sustainable Transportation Lab. “That enables you to have more supply in the system and more supply in the system means shorter waiting times.”

Where did the drivers go?

Gahayr stopped driving in the early days of the pandemic. He lived on savings until he became eligible for COVID-era unemployment assistance, which was extended to gig workers.

It was a common tale: Between April 2020 and September 2021, 7,640 drivers received emergency assistance from the state, said Anneliese Vance-Sherman, regional labor economist with the Washington Employment Security Department. Many didn’t return to driving: While the state finds it difficult to track gig workers, Vance-Sherman said 1,180 of them later showed up in a more traditional job classification leaving behind the gig life to earn wages as an employee rather than an independent contractor.

“If you were a … driver because you love the flexibility, then you’re still doing it,” said Vance-Sherman. “If it’s something that was earning you a wage and it ends up being a risky job for you, financially or healthwise, you’ve got more opportunities as a job seeker than you’ve ever had.”

“A lot of drivers that had to stop driving at the beginning of the pandemic, a good chunk of them haven’t come back in Seattle,” said Michael Wolfe, executive director of Drive Forward, an industry-funded drivers’ group, “ and the ones who have, we’re hearing reports from them that they’re taking fewer rides.”

Other drivers picked up work delivering food, through Uber Eats or DoorDash, said Kerry Harwin, communications director for Drivers Union, a local labor-backed drivers’ group. It may not have been enough to recoup all of their lost income, but with Seattle’s new minimum wage — which guarantees drivers $1.38 per mile, 59 cents per minute and a per-trip minimum of $5.17 — it could come close.

Gahayr, who lives in Tukwila and works to support his 2-year-old son, couldn’t make food delivery pencil out. Besides, he hated running around apartment buildings looking for whoever ordered a coffee. Earning less income was never an option. The trade-off, then, is longer hours.

Seattle lags behind

Uber and Lyft face headwinds. The stock prices of both have plummeted as investors pull back and the companies grapple with supply and demand. Uber CEO Dara Khosrowshahi warned of a tighter period ahead for the company in a memo to staff. Lyft also forecast slowed hiring and budget cuts for the company.

At the same time, gas prices have cut into driver margins. The companies have added a surcharge, increasing the cost of trips, which are as high as they’ve ever been.

The issues facing the two companies appear to be distilled in Seattle. MacKenzie of the UW said he was surprised that Seattle trip numbers are as low as they are, but pointed out that the city has been among the most cautious when it comes to COVID restrictions.

“I wonder how many people are still either avoiding Uber and Lyft because it’s a shared vehicle space, or simply they’re avoiding the places that they would commonly go when using Uber and Lyft,” he said.

Wolfe, of Drive Forward, echoed the argument from the companies, that Seattle’s new minimum wage for drivers has further depressed ridership.

“If the rest of the county is closer to 70% [of pre-pandemic ridership] but Seattle’s at 45, the only difference is Fare Share,” the name of the Seattle minimum wage law, he said.

MacKenzie said that’s a possible explanation but couldn’t say definitively Fare Share was to blame. Ridership on King County Metro buses correlates closely to the number of trips with Uber and Lyft; boardings in April 2022 were around 50% of boardings in April 2019.

Harwin said the minimum wage will be a net benefit, because driver earnings are buoyed by law.

“There’s more resiliency because drivers are able to make more than what they used to,” he said.

Gahayr recently started school to pursue a career in technical engineering, but put his education on pause as he spent more time on the road.

Lately, he’s considered finding a salaried job, maybe in the world of affordable housing. But he hasn’t put in any applications yet. “I haven’t fixed my resume,” he said. “Like I said, I can’t find the time because I have to always drive.”

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