The Uber drivers’ strike is doomed to fail
From Uber’s perspective, the solution is built into the business model: Surge pricing.
It’s interesting that Uber drivers are planning to strike ahead of the company’s IPO — not a good look for the company, but I strongly doubt that would-be Uber passengers will even really notice.
There are a couple of reasons conspiring to why it isn’t going to work. One is that the drivers themselves don’t have a way of punishing scabs, the other is that the platform already has a solution built in for load-balancing its drivers on the road.
“As a union member, you are bound by the union’s constitution and bylaws, which in most unions provide that members who work during a lawfully-called strike can be fined,” the National Right to Work foundation explains. The problem, for the drivers, is that they aren’t unionized, and there’s no real repercussion of driving while the strike is on.
On the Uber platform, if you aren’t driving your car, you’re not making money. This means that the opportunity cost of the drivers participating in the strike is significant: They could be driving and making money (or, in protest, drive for Lyft for the day instead of for Uber), but instead, they are opting to not make money for the day. The question becomes whether people feel passionately enough about Uber in the long term, or whether they are just trying to pay their rent, buy their groceries, and live their lives.
My gut feeling is that the gig economy doesn’t have any real loyalty to Uber, Lyft, or any other gig-economy jobs: It serves a purpose: it’s a flexible workforce for flexible people. Yes, the contract workers may be exploited by the companies, but I’d be surprised if a strike moves the needle.
As much as I admire people for taking a stand, there’s little reason to believe that the striking drivers will reach critical mass. As some drivers park their cars in protest, surge pricing will go up — but it will just be doing what surge pricing is designed to do: load-balance the supply/demand curve. Higher prices means both fewer passengers hailing rides (they change their mind because the cost is too high) and more drivers getting on the road (surge pricing is an opportunity to make more money).
If you’ve experienced surge pricing on a rainy day, you know what it’s like — and I’d be utterly flabbergasted if the Uber strike had much more of an impact on the availability of cars than a few buckets of water falling from the heavens. In fact, I’d be surprised if Uber headquarters even notices a strike is going on.