A new study from the University of Oxford has found that Uber’s pricing system is benefiting the company—but at the expense of both passengers and drivers.
Researchers discovered that since the introduction of a new pricing algorithm in 2023, customers are paying more for their rides, while drivers are earning less.
The research was led by Associate Professor Reuben Binns from Oxford’s Department of Computer Science and examined data from 258 Uber drivers in the UK.
The data covered over 1.5 million trips taken between 2016 and 2024. By comparing trends over time, the team was able to clearly see how things changed when Uber rolled out its dynamic pricing algorithm.
Dynamic pricing is designed to change fares based on demand, location, and other factors.
While this may seem efficient, the study shows that the changes have led to higher costs for riders—but drivers aren’t seeing the benefits. In fact, they are earning less per hour, even before subtracting operating expenses like fuel and vehicle maintenance.
Before the algorithm change, drivers were making over £22 an hour. After the switch, their income dropped to just over £19 an hour, adjusted for inflation. At the same time, the amount of time drivers spend waiting between rides has gone up—and that waiting time is unpaid.
Perhaps most concerning, the study found that the more expensive the ride, the bigger the cut Uber takes. For high-fare trips, Uber’s commission (known as the “take rate”) has sometimes been more than 50%. Overall, Uber’s average take rate rose from around 25% to 29%. This means that even when customers pay more, drivers often earn less per minute.
Professor Binns explained that these findings highlight a growing gap between what riders pay and what drivers take home. “The higher the value of the trip, the more of a cut Uber takes. So the more the customer pays, the less the driver actually earns per minute,” he said.
The researchers believe this raises serious questions about fairness and transparency in the gig economy. With millions of people depending on platforms like Uber for work or transport, understanding how pricing algorithms work—and who they benefit—is more important than ever.
The findings will be presented later this month at the ACM Conference on Fairness, Accountability, and Transparency (FAccT 2025), where experts from around the world will discuss how to make technology more fair for everyone.
