If you’re looking to earn side cash or a full-time income, you might be considering becoming a food delivery driver. You may think that major metro areas like New York and Boston offer tons of opportunities for delivery drivers, due to the high populations and plethora of restaurant food options.
But a new survey from Whizz, an electric bike rental company for delivery drivers in New York City, found that New York ranks as the worst state in the U.S. to be a delivery driver.
Mike Peregudov, CEO of Whizz, said he was quite surprised by the findings. “I understand it’s super expensive to live here, but I didn’t expect it to be the worst state to work as a delivery person, especially since there are more delivery drivers in New York than anywhere else.”
On the other hand, rural states with a lower cost of living, like North Dakota, Montana, and Kansas, ranked as the best states for delivery drivers, even when you factor in the costs of operating and maintaining a car vs. riding an eBike or a gasoline-powered scooter.
“There are around 100,000 delivery drivers in New York, and more than 80% are using eBikes or gasoline scooters. Hardly anybody is using regular bikes or cars,” Peregudov told GOBankingRates in an exclusive phone interview.
To determine the best and worst states for delivery drivers, Whizz evaluated the average monthly salary, income after taxes, the average cost of living in each state, and as a result, how much delivery workers could deposit into a savings account after covering their living expenses at the end of each month.
Delivery workers in New York relying only on their delivery salary would end up with a deficit of $136.46 every month. Delivery workers in states with other big cities, including Massachusetts (Boston), California (San Francisco, Los Angeles, and others) and Georgia (Atlanta) also did not fare well.
Drivers in North Dakota, after taking home $2,939.94 each month, could stash an average of $1,479.35 into a savings or retirement account.
Take a look at the rest of the worst (and best) states for delivery drivers based on Whizz’s research.
Worst States for Delivery Drivers
- New York
- North Carolina
Best States for Delivery Drivers
- North Dakota
- South Dakota
- New Hampshire
Peregudov attributed much of the difference between the best and worst states to housing costs. “Rent is by far the largest expensive, especially in New York,” he said.
In addition, some states have legislation protecting the wages and mandating minimum wages for delivery drivers. Although demand is not as high for drivers in places like South Dakota and Wyoming, the ones who work there can earn enough money to live comfortably, according to the Whizz data.
Although New York State recently passed legislation mandating that delivery app workers, such as those for GrubHub and UberEats, receive hourly wages of at least $17.96 per hour plus tips, that doesn’t include other delivery workers who don’t rely on these apps for work.
“My work is not entirely fairly compensated due to the base rate of $12.50, which falls $2.50 short of the $15 minimum wage,” said Crespo Giovanni, a delivery driver in New York who uses an electric bike. “Even with the guaranteed $21 an hour including tips, there’s an inequality. For bike couriers like myself, tips are pooled and rotated. On average, bikers complete around 15 to 20 trips daily over five days, each with approximately a $5 tip. Regrettably, we only receive about 50% of these tips. Accessing the full amount of tips could make a significant difference for us.”
To earn more profit, it’s important for delivery workers to maximize their time on the road while reducing operating expenses. Peregudov pointed out that this is where his company can help. “A lot of people don’t realize that maintenance and repairs on electric bikes and gas-powered scooters can be very expensive. When they rent an eBike, that’s all included,” he said.
On the other hand, if a delivery worker owns their vehicle, whether it’s a bike, scooter, or car, they can lose significant income if it breaks down for even a day or two. “At Whizz,” Peregudov said, “if we can’t repair it within 30 minutes, we give them another bike.”
Peregudov said he feels it’s also in the best interest of delivery workers to unionize. “Strategically, long term, it would be great for delivery drivers to unite in unions,” he said, citing the ongoing work of Los Deliveristas Unidos, the New York City-based union of app delivery workers, who first pushed for an increased minimum wage and then had to fight to ensure the delivery app companies complied with the law.
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