ST PAUL, Minn. — Editor's note: The video above first aired on KARE 11 on March 7, 2024.
Just one day after a rideshare ordinance to increase wages for drivers was passed by the Minneapolis City Council — and subsequently vetoed by Mayor Jacob Frey, Minnesota's Department of Labor and Industry (DLI) released its findings from a yearlong study into driver pay and protections.
The report, ordered by Gov. Tim Walz, showed the culmination of data collected from more than 18 million rides in 2022 and a survey of over 1,800 transportation network company (TNC) drivers across the state.
According to the report, drivers make an average of 48.7 cents per minute and 89 cents per mile in the Twin Cities metro and about 42.7 cents per minute and $1.116 per mile in Greater Minnesota. The ordinance passed in Minneapolis, if the council overrides Frey's veto, would allow drivers for services like Uber and Lyft to be eligible for 51 cents per minute and $1.40 per mile, in their respective regions.
But the news wasn't met with total satisfaction, as some drivers shared their concern that if their pay goes up, rider fare will too, potentially causing riders, including low-income customers, to reduce or stop ordering rides.
As for the council, it claims the ordinance would benefit workers by closing a loophole in the city's existing minimum wage policy, bringing drivers' average wages up to meet the current minimum wage of $15.57.
Factoring in drivers' time waiting for a ride assignment, picking up passengers and transporting passengers, the DLI report said in order to properly cover those expenses, per-mile pay should start at a base no lower than 89 cents to $1.207 per mile in the Twin Cities.
For drivers in Greater Minnesota, the report said wages ranging from at least $1.117 to $1.393 would be enough to offset drivers' aforementioned personal expenses.
In a statement Friday afternoon, Uber called the study, "deeply flawed."
“While the study is deeply flawed, it clearly recognizes that drivers are independent contractors," an Uber spokesperson said. "With the State and, most importantly, drivers agreeing that flexibility is critical, any compromise must prioritize independent contractor status."
The spokesperson also went on to claim the "Minneapolis minimum wage proposal is off by a whopping 60%."
Later Friday, Lyft released a statement, calling the report "nonsensical."
“The only part of this report that is grounded in reasonable data is its conclusion that Minnesota rideshare drivers earn more than $52 per hour of giving rides. The rest is nonsensical," said a Lyft spokesperson, in part. "This study is dishonest, counterproductive and a disservice to the goal of meaningful policymaking.”
According to DLI, 95% of Minnesota's rideshare trips happen in the metro's seven counties, while the other 5% happen in Greater Minnesota.
Read the full DLI report here or below.
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