Key Findings of Research Compiled by the Massachusetts Coalition for Independent Work and its Members.
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Two bills in the Massachusetts legislature this session, H.1848 and H.961, guarantee a driver’s right to flexibility while providing access to critical new benefits. The full text of both bills may be found below:
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Beacon Economics Report: Driver reclassification would result in loss of up to 87% of app-based jobs
As reported in The Boston Globe
“If Uber and other gig-economy companies are forced to make Massachusetts drivers employees… between 49,000 and 74,000 job opportunities across four major ride-hailing and food-delivery platforms could be lost, a drop of 58 to 87 percent”
Key findings:
- “Under an employment model, drivers would likely be required to work set hours each week and there would be a cost associated with hiring drivers as employees.”
- “These costs would, in all probability, translate to higher costs for consumers.”
- “Fewer hours of service would be demanded by consumers and these hours would be divided among fewer drivers working longer hours,” and
- “The move away from an independent contractor model for app-based driving is likely to disproportionately hurt workers who are unable to work set schedules, removing an important earnings opportunity for many.”
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BW Research Report: Massachusetts app-based drivers earn more than $26/hour
As reported in Mass Live
“The data paints a very clear picture of what drivers actually earn in Massachusetts, and in our analysis it is substantially more than many likely alternative forms of work. That is $26 per hour on top of the flexibility that drivers say in surveys is what they like most about this work…”
Key findings:
- Drivers in Massachusetts earned well above the state’s 2021 minimum wage of $13.50.
- They also earned substantially more than employees in industries identified as likely alternative sources of work earned during this period, including retail salespersons, counter and rental clerks, cashiers and fast food cooks.
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Independent study: Rideshare and delivery platforms generate $8.3 billion in annual economic activity in Massachusetts; $503 million in state and local tax revenue
As reported in Worcester Business Journal
“Leo Feler, an economist at the University of California, Los Angeles, and a former consultant at the Boston Consultant Group…estimates the economic impact of Worcester County to have been $899 million, with an additional $28 million in local tax revenue. In this averaging of economic models, the total economic impact in the state has been $8 billion, with $246 million in local tax revenue.”
Key findings:
- Middlesex County experienced an increase of about $2 billion in economic activity associated with rideshare and delivery platforms
- Suffolk County ($1.5 billion), Essex County ($1 billion), and Worcester County ($900 million) also saw increases of around a billion dollars or more
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Independent Study: Ability to Set One’s Own Schedule Equivalent to Substantial Increase in Wages
As reported in State House News Service
“…Kathryn Shaw, a labor economist at the Stanford Graduate School of Business and the Stanford Institute for Economic Policy Research… found that “Economic theory indicates that employment status would lead to reduced scheduling flexibility in the app-based economy.”…”
Key findings:
- ‘The ability to set one’s own schedule is the equivalent of an approximately 9% increase in wages.”
- “Under an employment model, hours would likely be chosen partly or wholly by companies, and potentially on short notice, an outcome workers typically dislike and find harmful.”
- “The ability to set one’s own schedule is the equivalent of an approximately 9% increase in wages.”
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BW Research study: Massachusetts consumers used App-Based Rideshare and Delivery Services nearly 85 Million Times in 2021
Key findings:
- Massachusetts residents used rideshare or delivery services more than 232,000 times per day on average in 2021.
- 21,000 restaurants, stores and other merchants used app-based platforms in 2021 and sold $1.5 billion in meals, groceries and convenience store items to consumers.
- Over 24 million deliveries or rides in Massachusetts (28.7%) ended in low-income areas.