After weeks of nonstop coughing, Carlos Martin finally went to see a doctor. His physician immediately ordered an X-ray, unveiling an aneurysm in his aortic arch. The bulge was just a few weeks away from bursting, said the doctor.
Martin was lucky his dangerous condition was caught in time. But he’s even luckier to have health insurance that would allow him to be treated at Stanford Hospital, where his family knew he would be in good hands. That said, the surgery he would have to undergo would be long and risky for the 62-year-old. And there was another big hurdle to overcome: As an Uber driver, Martin wouldn’t be paid for any of his time away from work. He and his wife Maria, who works as a cook and housekeeper in the Bay Area, were already living paycheck to paycheck in East Palo Alto, the slightly more affordable city across the freeway from Palo Alto. The couple, originally from Brazil, had no savings. They were now facing a $7,500 deductible payment along with the rest of their regular bills. Rent, their biggest monthly expense, would be the hardest to keep up with—landlords in the booming Silicon Valley don’t have much incentive to agree to lower rents or accept late payments, even if their tenants aren’t able to work, and more importantly, to get paid.
This is the harsh reality for most gig economy workers: If you can’t work, you don’t get paid. Contractors like Martin, who make up a growing swath of the American workforce, may get to choose when they start and stop their workday, but they don’t get paid vacation time or overtime or sick leave. Most don’t get health insurance unless they buy it themselves through the Affordable Care Act. (Martin and his wife were able to get help applying for insurance through a free clinic at Stanford University.)
This lack of benefits and steady wages is the reason that ridershare drivers plan to go on strike in several major U.S. cities this Wednesday, the eve of Uber’s much-anticipated public market debut. The initial public offering (IPO) is likely to be the biggest in the tech sector since Facebook went public in 2012, and will turn a small group of people into millionaires and billionaires. But for most drivers, the impacts of this momentous financial event are neutral at best.
Indeed, the upcoming strike presents a boiling point in the increasingly heated debate about gig economy workers, and whether or not companies like Uber and Lyft should provide contractors with more protections and stable pay.
As part of their IPOs, both companies will provide bonuses to the drivers who are most active on their platforms. But offering one-time cash rewards for the top tiers of drivers doesn’t do much to meet demands for more regular pay and for benefits that are standard for most salaried employees. Uber has suggested that it is not a platform intended for full-time work, and Lyft says more than 75% of its contractors drive less than 10 hours a week to supplement existing jobs. But Rideshare Drivers United, an association of drivers in Los Angeles, estimates there are about 100,000 rideshare drivers in the L.A. area alone, and that about a third of them drive full-time.
That includes drivers like Martin, who doesn’t have another job. Over the last three or so years, he has completed more than 7,000 rides for Uber, working through Christmas, New Year’s Eve, and weekends. On a typical week, he’s been out the door by five o’clock in the morning, returning home 12 hours later. A good week means he’ll make around $1,000—and that’s before deducting taxes, and the cost of gas, maintenance, and car payments. On a bad week, he makes half that amount.
“It’s really hard to live paycheck by paycheck if you don’t know how much you’re going to make each week,” says his 27-year-old daughter, Renata Martin.
Lyft’s IPO, along with Uber’s upcoming public offering, could put even more economic pressure on drivers, as both companies strive to cut costs and increase profits. (Uber lost nearly $2 billion in 2018; Lyft’s first earnings report as a public company, meanwhile, showed a $1.1 billion net loss in this most recent quarter.)
At the moment, Martin and his family are just trying to take things one day at a time, and to focus on his health despite the mounting financial burdens. On April 24, the Uber driver suffered a stroke during the lengthy operation to repair his aortic arch. The event impacted his brain stem and cerebellum, areas essential for breathing, swallowing, and movement control. His family still doesn’t know how much and how quickly he will recover, but Martin has already asked how soon he can start driving again. His doctors say that, even if he makes a full recovery, it will be a few months before he can get back behind the wheel. (In the meantime, his daughter, a grad student, is helping to support the family and has started a GoFundMe campaign to alleviate the financial burden.)
When Uber starts selling its shares to the public for the first time later this week, the ride sharing app that was founded just ten years ago could be worth nearly $100 billion. Martin, meanwhile, will be on the long and expensive journey towards rehabilitation, wondering how to pay off that $7,500 deductible—and when he can drive again.