Number Crunch

Uber and Lyft Drivers Have Drawn $80 Million in Government Assistance During the Pandemic

The gig companies don’t pay into unemployment insurance for their drivers, who have depended on a federal small business loan program to get through the pandemic

$80 million: That’s at least how much government assistance tens of thousands of Uber and Lyft drivers received during the pandemic under the U.S. Small Business Administration’s Economic Injury Disaster Loans program, established to provide assistance to small businesses, entrepreneurs, and independent contractors during the pandemic. That makes their drivers one of the largest groups to benefit from the program, according to an investigation by the Washington Post.

Critics claim that Uber and Lyft are shifting employer costs to the government. Last year, Uber and Lyft, along with Instacart and DoorDash, collectively spent $202 million on a successful campaign to pass California’s Prop. 22 ballot measure, allowing them to ignore a new California law that would have required them to classify their drivers and delivery workers as employees, rather than independent contractors.

In Uber’s defense, its representatives cite $29 million in assistance that the company provided to 100,000 drivers who either fell sick due to Covid-19 or have preexisting conditions that would have put them at risk for serious illness. But unlike other employers that may have had to lay off their employees during the pandemic, causing them to draw on expanded unemployment benefits, a gig company like Uber doesn’t pay into states’ unemployment insurance funds on behalf of all its workers.

In an interview about the gig economy last year, sociologist Juliet Schor explained why she refers to these companies as parasites: “In order to have a satisfactory experience on a gig work platform, you need another employer or another source of income,” she told Marker.

During the pandemic, it appears that the federal government has played the role of the host.

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