Don’t look now, but there’s actually at least one American-born and college-educated food delivery person in the army of faceless workers who perform this service for our fellow New Yorkers. I know because I’m that guy. And as an economics major — and at one time a successful businessman — I can see the issue of fair pay for delivery people from more than just the workers’ side. The new city law going into effect that will guarantee delivery workers the minimum wage is going to change the industry significantly.
Ordering through Doordash or Uber Eats is already very expensive. Not only do the companies charge the receiver of that food a delivery and service charge, but they suggest the recipient tip as well. Add on that the restaurant raises the price of its food (delivery companies take a cut from them) and the consumer ends up paying a harshly inflated price. And if you think it’s just fancy New Yorkers who use this service, guess again! I’ve done dozens of deliveries to NYCHA housing projects.
Despite all the upsells in this formula — and the reality that the services pay poorly and thus, the delivery people make as much or more of their paycheck in gratuities — Doordash and Uber Eats operate in the red.
In 2022, Doordash generated $6.6 billion in sales but spent $7.9 billion. It’s kind of like the old George Burns joke about his friend the counterfeiter who made gorgeous undetectable twenties. The only problem was it cost him $22.50 to make them.
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