Uber and Grab advertisements are raving about lucrative earnings and work flexibility. News articles on mainstream news publications in Singapore seem to echo these claims as well. On 13 March 2017, an article by TODAY features a driver who reportedly drives 9 hours a day and after deducting all expenses, such as petrol and rental, earns $6000 a month. This job seems to be a dream come true: an easy task for good dollars, given that the median gross income in Singapore was $4,056 in the year 2016*.
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Disclaimer: The writer at the time of writing had been an Uber and Grab driver for a year. Relevant research and interviews have been conducted for this article. Viewpoints and content of the article do not represent that of the entire private hire community.
*According to Comprehensive Labour Force Survey, Manpower Research & Statistics Department, Ministry of Manpower
The Spotlight: Earnings
Theoretically, for a 12km ride, it costs $8.50 ($2.50 base fare, $0.50 per kilometre, based on the information on the Grabcar website). Trips of this distance take about 15 to 20 minutes to complete. Based on experience, there are on average, two bookings every hour which add up to a total of $17 every hour. Deducting the 20% fare commission from every ride, this becomes $13.60 an hour (this is not profits yet, this amount is before petrol and rental costs). We did not calculate peak hour earnings as fares at that time tend to be higher and will vary, due to the fluctuation in surge pricing and peak hour traffic.
Peak hours are the best time to drive. Drivers tend to wake up early in the morning to drive during the morning peak hour from 7-10am then head back home to rest and continue driving for the evening peak hour from 5-8pm. This adds up to 6 hours of peak-hour driving. Typically, earnings from the morning peak hour are enough to cover the cost of car rental, leaving petrol and parking costs to be covered by the earnings in the evening.
You may use the fuel consumption (FC) of your vehicle to calculate the cost of petrol, for example, if the FC of your car is 10km per litre, that would mean you spend $2 (cost of 1 litre of petrol) every 10 km that you travel. Reset your odometer at the start of your shift to know your total distance travelled, then calculate the petrol cost.
To find out where are the hot spots to be at during certain timings, like our page here to be kept updated on our upcoming articles!
Work as an Uber and Grab driver does not start at 9 am and end at 5 pm every day. With the flexible driving hours (7 to 10 am, 5 to 8 pm), this allows drivers to run their errands in the afternoon. That being said, drivers still have to drive during peak hours since it is the peak hours which both Uber and Grab provides high incentives, resulting in higher profits.
For drivers trying to hit incentives, this means that work hours are the same every day since they have to drive during peak hours. The only flexibility is not accounting to your boss when you start work late.
Is Relying Purely on Fares without Incentives Enough?
Truth be told, incentives are what makes driving with Uber and Grab worthwhile. That extra $800 for 100 trips (latest grab incentive at the time of writing) adds significantly to a driver’s income. $2200 becomes $3000 after incentive. It is precisely this reason about incentives that we disagree that driving for Uber and Grab is flexible. Lucrative incentives are offered only at certain timings; this does not give drivers much freedom but to work at those timings. Incentives offered by Uber and Grab have also decreased tremendously since they started in Singapore. Some drivers that we spoke to signed a 2-year contract with their rental company only to be stuck to this commitment while the incentives continued to drop even more. Their earnings reduced tremendously, and work became “unbearable”. Such stories have not been mentioned in any articles.
Uber and Grab consider drivers as partners and not employees. No CPF and no employee benefits (MC, Leaves, Employee benefits, salary increment). You are your own “boss”. Remember the term “hand stop, mouth stop” (direct Chinese translation). This is a term frequently used by hawkers to describe themselves. If they do not work for the day, they will incur a loss as stall rental costs are still running. In perspective, a hawker can still boost their income by attracting more customers with higher quality food. For Uber and Grab drivers, all you get is a “thank you” and five stars, your earnings do not increase because your service is better than the rest.
For various age groups, the rationale of working as an Uber and Grab driver varies. For retirees or the older generation, driving tends to be an activity to keep themselves busy. For working adults, working as an Uber and Grab driver helps maintain the income and build their networks while in search of better job opportunities. For the younger generation, the ownership of a car which was previously out of their reach appeals to them.
Specifically, many in the younger generation fail to see the implications of fully committing to being a full-time Uber and Grab driver. Bluntly, there is no career progression as a driver. Ten years from now, you will still be doing the same thing. This job does not value add to a resume. We highly recommend people of this age group to use the time to pick up some skills for self-improvement.
A Driver’s Lifestyle
Although it is not a boring job (you get to meet and talk to your passengers), it is a lonely one where you work alone. The unpredictability of where you may be in an hour’s time makes it tough to arrange a simple meal with your friends. For higher earnings, you may be inclined to skip the toilet break and continue driving around especially if you happen to be in a secluded area since it’s difficult to get a booking or when you do not want to miss a high fare in places where demand is high.
As a full-time driver, driving for 8-10 hours a day would allow you to meet different characters. Similar to the service line, there are bound to be rude or unreasonable people. Read our article on the types of riders here!
Drivers lead a repetitive lifestyle. A driver friend of ours recalled a chat with his passenger who summarised a driver’s lifestyle in 4 words – Eat, Drive, Sleep, Repeat! Honestly, nothing describes it better.
Unlike the general employment, all risks are borne by the driver. The risk of getting into an accident, the chance of damaging the car’s paintwork, the risk of a tyre puncture and even a breakdown. All these risks equate to a loss of income.
The service provided by rental companies are something frequently overlooked. Your deposit given to the car rental company is at risk of being forfeited if the vehicle is not returned in a satisfactory condition.
Is it Suitable for Me?
Driving for Uber and Grab can be rewarding only if you are willing to commit to the long hours, drive smart and keep costs to the minimum. You can only then earn a decent income from this.
Drivers’ Recommendations and Useful Links
Remember these few pointers should you decide to be an Uber and Grab driver.
1. Advertisements: Logically, an excellent opportunity wouldn’t require frequent advertising.
2. About rental companies: Cheap does not necessarily mean good. Consider factors such as servicing terms & conditions, insurance access, the period of notice (for the return of car).
3. About driving: Health is more important than anything. Remember – no CPF = no Medisave. Your Health is your responsibility.
4. About earning more: Coming soon! Like our page to keep updated of our upcoming article about lucrative areas to head towards for higher earnings at various timings.
Our Complete Guide on Grab vs. Uber:
Part 2 – About signing up
Part 3 – About types of riders
Other Grab/Uber Reads:
What Grab and Uber don’t tell you – Digging Deeper (You are reading this right now)
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