The expulsion of Uber and Lyft from Austin comes with a price tag: roughly $29 million in lost revenue for drivers, not to mention taxes collected by the city.
In the name of “safety,” Austin voters cost the city fund, funding, and lives, according to Courtney Powell at Austin Startups.
Powell heads an Austin-based startup, and laments the loss of ride-sharing companies and the opportunity they provided Austinites.
“Beyond higher pay and flexibility, Uber and Lyft created opportunities for underrepresented communities. I’ve seen Austinites who are deaf, or for whom English is not their first language, drive for Uber and Lyft successfully,” Powell wrote. “Imagine an entire underrepresented community offered a new opportunity to earn a living, now part of the more than 10,000 people that have lost income.”
New city regulations that required fingerprinting and other changes in oversight drove away Uber and Lyft. The companies had processes for safety and background checks, but did not require fingerprinting due to cost and timeliness. Now, the part-time and full-time drivers have lost that income source.
It’s a step back for the city as more travelers and residents of large cities expect ridesharing in modern, growing metropolises.
“I know of no greater interest for Austinites than enabling every opportunity for as many citizens as possible to earn a living,” Powell wrote.
Based on the number of part-time drivers, average earnings, and average hours worked, Powell found that the $29 million in yearly earnings is lost, not to mention the 40 percent of full-time drivers.
It could also dissuade investors from turning to Austin. How the city treats Uber and Lyft mirrors how the city will treat new and nontraditional companies. If voters, or the city council, oppose a different business structure, it sends a signal to prospective investors to avoid the city for friendlier locales.
That this battle takes place in Texas is surprising. Texas has been the magnet for population and economic growth in the United States. Since 2010, Austin has grown by 37 percent and the state has added almost 2 million residents. Texas consistently ranks near the top for business friendliness. If city governments, and their residents, become less tolerant of businesses, its economic growth could stagger. If Texas becomes more like New York in that respect, the nation’s economic growth is at stake.
