Food delivery apps blame minimum wage for inflation. It’s bullshit

Brad Lander is the New York City Comptroller.

When New Yorkers order a Chinese meal or salad for lunch on their delivery apps, the meal shows up a few minutes later. But it’s not magic, technology, or a billion-dollar app company that makes it happen. He’s a human being.

Unfortunately, despite New York’s rain, snow, heat and traffic, these delivery workers, or delivery workers, are often treated as barely human by the companies that rely on them. Some restaurants deny them the use of toilets during long work days. The apps’ payment algorithms push them to deliver meals to opposite ends of Manhattan in just a few minutes. The mortality rate therefore became one of the highest of all jobs here.

And until recently, delivery workers earned less than minimum wage, sometimes as low as $6 an hour. So last year, New York City became the first city in the country to take action on this issue. I was proud to be the City Council sponsor of the minimum wage bill, which increased the minimum wage for delivery workers to $17.96 an hour.

No one is getting rich at this rate, just above the New York minimum wage; but at least these hard workers can be assured of the bare minimum.

Unfortunately, Uber, DoorDash, and Grubhub are doing everything in their power to undermine this. They abandoned lost cases and relentlessly pressured city hall. Then they made it harder for customers to tip.

It is not a surprise. They did the same thing in 2018 when we passed legislation – which I also sponsored on the City Council – guaranteeing minimum wages for Uber and Lyft drivers. Businesses attacked the law through lobbying, public relations campaigns and lawsuits. They sent push notifications to drivers and customers to spread lies, including the threat of closure. Just like they are doing now in Minneapolis, where the city council recently passed a similar bill.

But the law works. Six years later, Uber and Lyft are doing well in New York. In March 2024, New Yorkers and tourists took 686,475 Uber and Lyft rides per day, the highest level since the pandemic. We estimate that app publishers here earn over $1 million per day.

The difference for drivers has been enormous. One analysis found: “New York drivers earned more per hour and per trip on average, people were not significantly discouraged from riding with Uber or Lyft, and even the companies probably did better. »

Likewise, there is no evidence that the minimum wage for delivery workers has a negative impact on customers. Uber Eats, DoorDash and Grubhub together make an average of about 2.6 million deliveries per week, before and after the rate increase.

So their next argument is that the apps blame inflation on these marginal wage increases. You might have thought it was supply chain disruption, pandemic stimulus, or greed. But no, according to some, it’s your delivery person or Uber driver’s fault if he demands to be treated like a human being.

It’s a classic argument from some out-of-touch billionaires to blame the minimum wage for inflation. But that’s nonsense.

As New York City’s comptroller, I analyze the city’s economic landscape and here’s what the data says: A higher minimum wage for our lowest-paid workers lifts many boats. This is what happened when New York gradually increased the minimum wage to $15 an hour between 2013 and 2019.

Employment in industries with a high percentage of minimum wage workers, such as fast food, grew 31% in New York, much faster than the 20% average in the 12 cities nationwide that did not not increased their minimum wage at that time. .

The income of minimum wage households increased by 50% and the poverty rate of these households decreased by 7%. As employment and incomes increased, so did the opening of new restaurants and hotels.

Raising the minimum wage to $15 gave some economic security to hundreds of thousands of low-wage New Yorkers. Our 2018 law did the same for Uber drivers. And our new law does the same for delivery workers who have played a vital role during the pandemic and continue to provide an essential service.

It’s no surprise that app publishers are peddling ridiculous deals blaming their own low-wage workers for inflation. They seek to extract every penny possible from the delivery workers whose work they rely on to improve their bottom line. This is the economic model of concerts. And they are coming for us more and more.

But the data is clear: Allowing low-wage workers to earn enough to support themselves is good for the economy. Do not accept divide and conquer nonsense that claims otherwise.

Workers who put food on our tables should be able to put food on theirs.

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