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February 9 2018

Uber Has a Gender Earnings Gap, but There's a Good Explanation

by Patrice Lee Onwuka

Men and women who drive for Uber don’t take home the same earnings. It's due to the different preferences and strategies that the genders employ - not gender discrimination.

The sharing economy offers tremendous benefits for workers that include full control of their schedule sand earnings. For example, ride-hailing allows individuals such as moms with school-aged children or retirees to earn a paycheck without having to sacrifice other priorities.

New analysis from Stanford University finds that when driving for Uber women don’t earn the same amount that men do. After analyzing data on a million Uber drivers, researchers found that men earned roughly 7 percent more per hour than women. The gap is not due to systematic discrimination or biases against female drivers though, but preferences and choices women make.

Three factors contribute to the earnings gap for Uber drivers:

  1. Choosing when and where to work - Men tend to drive in more lucrative locations and during peak request times.
  2. Driving experience - Men drive more each week and gather more knowledge about the best times and places to drive as well as how to strategically accept or cancel trips.
  3. Driving speed - Men are more risk tolerant and aggressive drivers than women so they drive faster to complete their trips sooner and move onto their next trips.

Making choices about when and where to work can lead to great rewards if you’re willing to take the risks or accept the trade-offs. Women drivers may consider their safety, intoxication of passengers, or proximity to their home when deciding on their schedules and routes. There’s a good reason that we don’t see as many women driving at 2:00 am on a Saturday or Sunday morning in certain areas.

The key takeaway though is that all things being equal, men and women can hold the same job and still not earn the same amount because of work preferences. That applies to more than just ride-hailing but the overall pay gap.

The report concludes:

Overall, our results suggest that, even in the gender-blind, transactional, ?exible environment of the gig economy, gender-based preferences (especially the value of time not spent at paid work and, for drivers, preferences for driving speed) can open gender earnings gaps. The preference di?erences that contribute to pay di?erences in professional markets for lawyers and MBA’s also lead to earnings gaps for drivers on Uber, suggesting they are pervasive across the skill distribution and whether in the traditional or gig workplace.

This is more evidence against the pay-gap narrative that blames discrimination for differences in earnings between men and women.

 

IIndependent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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