Mr. Cab Driver
I admit it: I didn’t know much of anything about the taxi business before I got the job as Host of Cash Cab. What I have learned since changed my perspective on riding in taxis and my opinion of the people who are licensed cab drivers.
I’m writing this post about the taxi drivers’ protest against Uber in Toronto.
If you’re angry or frustrated by today’s protest, I can change how you feel about it without you having to go to taxi school, like me, and becoming a licensed cabbie.
I agree that violence and unruly public protests aren’t the pathway to finding a positive solution to any problem. You have reason to be frustrated, and you deserve to be able to get to work without unnecessary disruption on your commute so that you can be successful in your job. You will, however, understand the desperation of drivers with a little background. Let me give you analogy that represents the driver’s perspective in the taxi industry.
Imagine you want to make money by owning a home and charging people a fee every time they come visit. You don’t have enough money to buy a home, so you “lease” a property. Every time someone comes to your house, you charge them $30. Simple, right?
No. At some point you have to eat, sleep, run errands, live a little, see your family and friends, etc… so, you only lease the home and have visitors for 12 hours a day. In fact, you have to vacate the home because someone else who also wants to earn money this way has leased it for the other 12 hours of the day.
After every 12 hour shift for which you have the home, you crunch the numbers. The owner of the home leases it to a building manager for $1,500 per month. Then that building manager turns around and is prepared to lease it to you for $2,000 a month, or $120 every 12 hr. shift. Actually, when you first started out, you didn’t even know where to lease a home, so someone else who had leased a home offered it to you for $150 per shift. Oh, and while you’re in the home, you have to pay for all of the utilities, your meals and anything else you provide in entertaining your paying visitors. Did I mention that there are dozens, if not hundreds, of other homes licensed in your neighbourhood to operate in exactly the same fashion? So, you don’t typically have more than a visitor, or two, every hour in peak times. Call it one visitor per hour on average. Plus, not every visitor stays as long. So you can’t charge $30 every visitor, but instead an average of, say, $25. Therefore, at the end of a typical 12 hr. shift, your gross revenues are $300. Subtract the $150 lease fee, $35 in utilities, $15 in meals. Now your net profit is $100. You’ve just worked as 12 hour shift for $8.33 per hour. And I haven’t even mentioned the annual fee you have to pay the city in order to have a permit to run your business. Or the fees charged by the building manager and credit card companies when your visitors pay using plastic. Or the $50 cleaning fee you had to pay the building manager when one of your visitor’s vomited on the couch.
You do a little research. The home that you are leasing was purchased in the ‘80’s for about $37,000. In 2013, that same home was worth about $300,000. Realizing that you’re better off in the long run if you can own the home, you gather everything you have, borrow from some family members and the bank, put together all of your savings and you are fortunate enough to buy a home for $350,000. Now you’re going to work the home by having visitors yourself, lease it out to others to do the same, see it’s value appreciate over time and eventually pass it on to your children, or sell it for a profit. You’re fully invested in this home, but at least you won’t be working for less than minimum wage.
Things are going to be great! Uh oh. A few months after you bought your dream home, the rules changed and now the city will mediate any sale of your home and has introduced strict new conditions and guidelines upon which it can be operated and sold. You are devastated and unsure how you will survive financially.
But, as if that’s not bad enough, there’s more. A new company has come to town. In addition to the dozens, if not hundreds, of other homes in your neighbourhood already permitted by the city to do what you’re doing, this new company provides a cool and innovative way for anyone else who wants to, to do the same. They don’t even have to have a city permit, or follow any of the old rules or new strict guidelines that you do. They don’t have to pay a building manager any fees, so they are able to charge a lot less per visitor. So, now the one visitor per hour on average you were counting on in order to make $100 every day is visiting other people’s homes.
You’re worried about your future, the future of your children and about having all of your savings completely wiped out. Your few visitors don’t understand why you’re angry. They don’t enjoy their visits to your home, so they don’t even give you a tip. Now the average visit is less than $25. The rage builds within you. You feel you have no choice but to take matters into your own hands and stage a dramatic public protest so people know what’s going on! People respond by telling you you’re lucky to have a job, to be your own boss, set your own hours. People tell you to join this cool new company, get the App and embrace the technology of the future. People tell you to “stand down”.
You know the system is broken and that the way things have worked in the past are problematic. You know that the city is trying to take steps to fix the problems, but don’t understand why they aren’t protecting the most vulnerable individuals in that system. You know that innovative new technology can benefit your industry if accessible in an equitable fashion. You also know that you have to take a stand to protect your livelihood; a livelihood that gives you annual earnings of about $36,000. And that’s in a good year.
I’ve just described the reality of the taxi business for your typical cab driver.
If you’re still angry, or frustrated by today’s Uber protest, take one taxi this week, and tip 20%. You’ll feel different.
Here’s a link to taxi numbers.