The rise of delivery apps such as Instacart and DoorDash during the pandemic, when consumers were willing to pay extra for groceries, takeout and other items, created more demand for gig workers. But in 2023, such jobs got more competitive and paid less, reported Business Insider.
Business Insider spoke with about three dozen people who work for Instacart, DoorDash, Walmart's Spark and other delivery services that rely on gig workers. The conversations included several common themes: Working as a delivery driver got a lot harder over the past year. Finding orders to deliver can be a challenge. Many workers are getting paid less as some services cut base pay.
Less Work, Less Flexibility
Despite Instacart's workforce swelling to 600,000, and Walmart’s estimates that "hundreds of thousands" of people have made deliveries for Spark, demand for delivery tapered off since the early pandemic. That translates to less work and lower earnings for many workers, said Business Insider.
Instacart encourages shoppers to hang out in parking lots near busy areas identified using color-coded heatmaps, Business Insider reported earlier this year. The company says that being near a busy store improves shoppers' chances of claiming orders.
That's a contrast with past years when many gig workers could claim an order from home even if they were miles away from a store.
"Now, you're not really free anymore," one gig worker in Utah told Business Insider. "You're locked in."
Less Pay, Less Reliability
Less than 10% of gig workers make over $2,000 a month, according to research from PayQuicker, a payments company with clients in the gig-work space. And, about 1 in 7 gig workers (14%) earned less than the federal minimum wage on an hourly basis, according to an Economic Policy Institute 2020 survey of gig workers.
“It’s going to take two jobs to give you the same status of living that earlier generations could enjoy with one job,” sociologist Alexandrea Ravenelle told CNBC.
Ravenelle also pointed to research by the Federal Reserve that found 16% of American adults engage in gig work, and a recent report by H&R Block that showed that on average millennials work two jobs.
Instacart cut its minimum payment per group of orders from $7 to $4, Supermarket News reported in August. Many workers decided the job wasn’t going to work anymore.
Alexia Hudson, who spent two years delivering orders for Instacart in the area around Charlotte, North Carolina, told Business Insider at the time that the pay cut meant the job didn't make sense for her anymore. Since then, she has started a full-time job and has stopped delivering for Instacart.