Are Uber and Lyft rides more expensive than ever because of a driver shortage?

The average Uber and Lyft fare hit a record high in the U.S. last month, according to market-research firm YipitData, driven by the labor shortage and high gas prices.



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The cost of an Uber or Lyft ride has skyrocketed as the firms seek steady profitability, but workers aren't getting a proportional share of the spoils. A report released last week by the UCLA Labor Center found that Uber and Lyft took an even larger share of drivers' profits as fares increased in recent years.

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Originally Answered: Why is the cost of taking a Lyft so ridiculously high recently? Drivers not driving due to Covid increases demand. Greater demand equals higher prices.

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Because rates are updated based on the demand in real time, surge can change quickly. Surge pricing is also specific to different areas in a city, so some neighborhoods may have surge pricing at the same time that other neighborhoods do not.

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Prices go up In these cases of very high demand, prices may increase to help ensure that those who need a ride can get one. This system is called surge pricing, and it lets the Uber app continue to be a reliable choice.

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Lyft fare is based on ride route and ride type, as well as ride availability and demand. When many passengers in your area request a ride at the same time, ride prices will likely be higher than normal. You can expect higher demand during commute hours, big events in town, and when bad weather hits.

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Surge pricing, which Lyft calls Prime Time, typically kicks in when there aren't enough drivers to meet demand. The idea is that off-duty drivers will smell an opportunity to make more money and be more inclined to hop in their car and work for a while. However, riders by and large do not like surge pricing at all.

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Basic supply and demand. The more drivers in the area, the more ability to fill the demand. If there are less drivers, which at night there are (and really early in the morning), then the demand may be higher than the supply of drivers.

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Ride-hailing companies have struggled with supply and demand since Covid-19 took drivers off the road. Uber had to rely on incentives to bring drivers back, which ate into financials. That seemed to be stabilizing in recent months, but the war in Ukraine has caused significant hikes in fuel prices.

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While Uber diversified its business beyond ride-hailing by delivering meals and grocery items, Lyft never did. That arguably hurt the company earlier in the pandemic when fewer customers were traveling but more were ordering items online.

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Promotions, ride discounts, and Lyft credit
  1. Viewing your active promos in the app.
  2. Ride discounts. Adding promos to your account. Applying promos to a ride. Rider referral discount. Driver referral discount. ...
  3. Ride credits. Redeeming ride credits. Using credits as a new rider. Sending ride credits.


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The pandemic initially walloped Lyft by drying up demand for ride-hailing services, a blow Uber was able to soften through an aggressive expansion in food delivery. That gave people a reason to continue using Uber's app even when they were stuck at home while Lyft fell out of favor.

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For example, Lyft's average incomes are around $18 per hour, while Uber's average income can sometimes average as low as $15 per hour. With this thought in mind, at the outset, you may be able to earn slightly more with Lyft; this may be because Lyft riders are generally more likely to pay a tip than Uber riders.

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All in all, Uber drivers in 2022 were grossing about $1,040 on average per month, while Lyft drivers were grossing $787 per month. Now, that's not to say Uber drivers always make more than Lyft drivers for the same hours or miles driven.

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The study comes as Uber has hiked prices around the world, citing surging gas prices and a persistent driver shortage. New York also has a minimum wage for drivers and a congestion surcharge policy that likely contributes to high fares.

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