The Impact of Uber in Chicago
Introduction
Uber is driven by the mission to get people where they need to. In Chicago, Uber helps riders to navigate the city in a safe and convenient way, whilst also creating new earning opportunities for drivers and contributing to the overall prosperity of the City’s economy.
As one Chicagan local expressed it,
“Uber is just so embedded in Chicago’s culture.”
For this research, Uber Chicago commissioned Public First to help gain an in-depth insight into the impact of Uber for people who use the platform across Chicago. The report draws on commissioned consumer surveys, anonymous Uber driver surveys, original economic modelling, Uber’s internal data, and in-person interviews with Chicago residents.
Using these, Public First examines the economic and social impact of Uber’s ride-hailing services on the City of Chicago.
Key Facts
Uber’s Economic Impact in Chicago
Uber created an estimated $1.8 billion in economic value in Chicago in 2022.
Generated over $102 million in direct tax revenue for the City of Chicago
Uber’s Impact for People in Chicago
of riders have used Uber in the last year for an essential journey.
of riders agreed that Uber has made it easier to get around Chicago.
We estimate that Uber produced $470 million in consumer surplus in Chicago in 2022.
Uber’s Impact for Drivers in Chicago
We estimate that drivers earn an additional $78 million annually through Uber – an average of 7.4% more than they would make in their next best alternative job.
of drivers agreed that their earnings through Uber have helped them feel more financially secure.
About Public First:
Public First is an independent consultancy that works to help companies and organizations develop new policy proposals, better understand public opinion, and model their economic and social impact. Public First is a member of the Market Research Society.
About This Report:
In this report, Uber commissioned Public First to better understand and quantify the impact they were making for riders, drivers and communities in Chicago. All values are given in USD$.
We used a mixture of methods to explore Uber’s impact:
- Public First ran an in-depth consumer poll of 2,034 adults in Chicago, weighted to Chicago metropolitan area demographics,to explore their travel habits.
- Public First ran an in-depth driver poll of 293 Uber drivers in Chicago to explore their experiences with Uber.
- Public First then created new quantitative models of the economic impact, time saved, consumer surplus and driver value created by Uber.
- Finally, Public First conducted immersive research in September 2023. We held 14 interviews with Uber drivers, and over 50 interviews with members of the public in locations across the city. All participants spoke on the condition of anonymity, and therefore we have not used their names in this report.
To learn more about our modeling approach, please see the Methodology section in the report’s appendix.
Uber’s Economic Impact in Chicago
Uber helps Chicagoans get where they need to go – saving time, offering flexible travel options, and fitting around their schedules. It also provides thousands of drivers with flexible income and contributes significantly to the city’s tax revenue.
Our conservative estimates based on 2022 data suggest that:
Uber unlocked $1.8 billion in economic value for the City of Chicago in 2022. This includes both the impact of the earnings of drivers on the Uber platform, as well as the wider indirect and induced multiplier effect created throughout the platform’s wider activities.
Every one million Uber trips in the city contributes $27 million to the local economy.
Uber generated at least $102 million in direct tax revenue for the city of Chicago in 2022, equivalent to the amusement tax generated by over 190 music concerts at Wrigley Field.
Uber’s Impact for People in Chicago
How do people in Chicago use Uber?
Our research shows that Uber is there when riders need it most.
of riders had used Uber in the last year for an essential journey.
of riders had used Uber in the last year when they needed to get somewhere fast in an emergency.
of riders had Uber in the last year for friends and family who struggle with mobility.
of riders had used Uber in the last year to travel to or from a doctor or hospital appointment.
of riders had used Uber in the last year to travel to or from work.
Uber also helps to facilitate leisure activities and socializing across the economy:
of riders had used Uber in the last year to visit friends and family.
of riders had used Uber in the last year to see a film, show or performance.
of riders had used Uber in the last year to travel to or from a sports event.
of riders had used Uber in the last year to visit a bar or restaurant.
Why do riders choose Uber?
When asked, 45% of respondents said that ridesharing apps have made the biggest positive impact on their traveling experience in the last ten years. We found that “convenience” was the most important reason why riders in Chicago choose to use Uber (93%), closely followed by “reliability” (91%) and then “safety” (89%).
Indeed, as many consumers seek to limit their spending, Uber is often seen as good value for money. When thinking about their last journey with Uber, 36% of riders saying the next best alternative would have cost them more.
Uber also saves riders a significant amount of time. On average riders say Uber saves them 11 minutes per trip compared to their next fastest alternative. Thus, we estimate that Uber saves riders in Chicago a total of 12 million hours per year. This is equivalent to every runner in the Chicago Marathon running the course approximately 59 times.
We asked riders to tell us in their own words why they chose Uber. The most commonly used word was: convenient.
Why is Uber important to Chicago’s transport network?
Chicago’s “transit deserts” often leave residents without easy ways of getting home. Uber is therefore particularly important for bridging the gap between other transport options and riders’ homes. According to our survey, 28% of respondents living in a “transit desert” have used Uber in the last year. By addressing these last-mile challenges, Uber fills the gaps where public transit is unavailable or sparse.
What is a transit desert?
A transit desert is an area that has high demand for transit but lacks access to high-quality transit, meaning that it is more than a half-mile from a rail transit stop and a quartermile from high-quality bus service.
High-quality transit can be rail, bus rapid transit (BRT), arterial rapid transit (ART), or bus routes with frequent service (average headways of 15 minutes or less).
Estimates by the Center for Neighborhood Technology suggest that approximately 438,500 Cook County residents live in transit deserts.1
of riders agreed that Uber has made it easier to get around Chicago.
of respondents agreed that their local public transport is not very reliable or convenient.
of riders agreed that Uber is particularly important for getting to and from the part of Chicago they live in.
of respondents agreed that it is much easier to get to and from their area with Uber than with public transport.
of riders have used an Uber drive in the last year to connect with another form of public transport.
of riders have used Uber at least once in the last year when it was the only way to get home late at night.
Case Study:
Man, 30s, Downtown
Noah2 works at a Starbucks in the center of the city and it takes over 40 minutes to get to work from his apartment during peak service hours. While he has heard many people complain about it, he likes public transport in the city and enjoys riding the CTA coming back from work or visiting his friends.
That said, his job means that Noah often has to be in the city very early, and he says will almost always take an Uber to travel in for the morning shift. He explains “the early hours are normal for me, I mean I could alternatively wake up two hours earlier and take public transport, but I would much rather have the sleep.”
Although he’s a Chicago native, he believes the city can feel unsafe for those unfamiliar with certain areas, and in those situations, Uber provides a crucial service. He especially values the Uber feature that lets him pre-arrange a pickup at a CTA station.
How does Uber support safety?
of riders said they felt safe or very safe on their last trip with Uber.
of riders said Uber was the safest way to get home late at night.
of riders say safety is an important reason why they choose to ride with Uber (this rises to 93% amongst female riders).
of riders told us that without ridesharing services like Uber it would difficult to find a safe way to travel at night.
of riders who had used Uber in the last year reported using Uber after consuming alcohol.
of Uber users believe that having options like Uber helps reduce drunk driving in an area.
Case Study:
Woman, 20s, West Side
As a student at the University of Chicago, Lisa travels into the city almost daily from her apartment in Pilsen. She has recently moved to the city for her studies and does not know it too well.
While she likes the convenience of Uber, it is the safety element which is most important to her. As she doesn’t have a car, there is no other way Lisa can study late or visit friends in other parts of the city and feel comfortable getting home safely.
When she is out past 10pm she will always take an Uber so she doesn’t have to walk home in the dark from her nearest transport stop which is over 10 minutes walk from her apartment. She explains “the trains can be pretty rough – buses are usually fine but the buses stop running by like 10 o’clock usually. So if you’re out late at night, it’s kind of like the train or you’re Ubering.”
Case Study:
Man, 30s, East Side
Ethan takes both public transport and Uber to travel around the city. He works for Chicago Public Schools (CPS) and lives in Calumet Park.
In addition to his job with CPS, he works evenings on the other side of Chicago and often has little time to travel between the two. When he’s near a main route, he takes the bus – but when he’s not, taking an Uber is the only way he can reliably get to his second job on time. This is a regular occurrence, and the time Uber saves is crucial to managing both jobs in different parts of the city.
Despite having a job in the inner city, Ethan never goes there to socialize and instead likes to visit friends and different venues in more residential areas. He said “in the inner city it’s better to take public transit because there are trains and buses running everywhere, but in the suburbs, it is much harder to get around because the buses don’t run as frequently”. Without taking Uber, it would be difficult for him to visit many of these places.
Do riders value Uber’s services?
According to our survey, 39% of riders said they wouldn’t have made a recent trip if Uber didn’t exist. This reiterates that Uber is essential for getting around.
One of the most important measures of economic welfare is the “consumer surplus” —the amount you would have to pay someone for them to voluntarily give a good or service up. If a good has a zero consumer surplus, that implies we can take or leave it – whereas goods with a high consumer surplus are playing an important role in our lives.
We estimate that Uber produced $470 million in consumer surplus in Chicago in 2022.
Uber’s Impact for Drivers in Chicago
Who drives with Uber?
Uber offers a flexible source of income to a whole host of different people in Chicago from diverse backgrounds.
of drivers we surveyed are male and 19% are female.
of drivers we surveyed are university or college graduates.
of drivers we surveyed have children aged under 18.
In which area of Chicago do you currently live in?
of drivers are also entrepreneurs or business owners.
of drivers are also a student.
of drivers are also a stay-at-home parent.
of drivers are also a caregiver.
Why do drivers choose to work through Uber?
Drivers have various motivations for finding work through the app. When asked, the top three most important factors drivers look for in a job were good earnings (65%), flexibility of hours (39%), and allowing a work/life balance (36%).
50% of drivers report feeling satisfied or very satisfied with their work through Uber, and 69% of drivers also told us that app-based work gave them a feeling of independence.
In total, in 2022, we estimate that drivers earn an additional $78 million a year in higher income through Uber, or an average of 7.4% more than their next best alternative.
Case study:
Man, 60s
Omar is proud that he has made over fifteen thousand trips with Uber. Having worked for Uber in a part-time capacity when it first launched in the city, he is now working full time. He was born and raised in Chicago, and after a long career working in a number of different industries loves finally being his own boss.
His favorite thing about Chicago is its diversity, and Omar enjoys meeting and talking to new people. A history minor and sports enthusiast, he will discuss any subject with riders (except politics or religion!). They come from all walks of life, and through his job he often finds himself helping people through personal moments. Some of these are very difficult, he remembers “last week I picked up a woman who needed to go to the hospital to see her unwell daughter after her granddaughter died, that was really hard.”
He says the money he gets from Uber is good, but the thing he likes most about his job is that he can set his own pace of life. No matter the day, weather or event, he will always make sure he has enough time in the afternoon for his biggest passion: cooking.
Case study:
Woman, 30s
Alongside driving for Uber, Brenda is doing a master’s in business administration. After a 15-year studying break since completing her undergraduate, returning to school has been a big deal for her. Her daughter recently turned 10, and through driving for Uber she is able to make money to keep supporting her family.
She says she has been driving for Uber on and off for the last four years, since leaving her job in finance. Often, she will split childcare with her husband, so one of them spends half a day looking after their daughter, and the other works. She explains “I’m not set to a time of driving, I choose when I drive, which is more convenient for me. Because if I want to help my kid at home in the morning, I’m able to do that. And then drive in the afternoon.”
Brenda enjoys the interactions she has had with riders, and regularly finds herself helping people get to the office on time when public transport has been unreliable. She has driven many people to the hospital for appointments and operations, and even taken their pets to the animal hospital.
Why is flexibility important?
Uber offers drivers the ability to drive when it suits them, fitting work around other commitments and priorities and the opportunity to save additional income. It’s therefore unsurprising that, according to our driver survey, 39% of drivers said that schedule flexibility is important to them when looking for work and, on average, flexibility was a more important factor than earnings in why drivers and delivery people choose to work with Uber.
Flexibility can be particularly important for those with other caring responsibilities for children, elderly relatives or others who need support:
of those with children aged 18 or under or caring responsibilities said that the flexibility provided by app-based work made it easier to balance family and work responsibilities.
of those with children aged 18 or under or caring responsibilities said that working via the Uber platform provides them with significantly more flexibility than their past jobs.
In order to test its importance, we asked drivers and delivery people whether they would prefer a hypothetical situation in which they received higher earnings, but had to work fixed hours. A plurality of drivers said that they would rather retain the right to choose their own hours, even if the alternative was a 50% increase in earnings. In total, in 2022 we estimate that this increased flexibility is worth $880 million to drivers in Chicago.
Case study:
Man, 20s
C.A has been driving for Uber for the last year. He balances this with a background in construction, where he specializes in demolition, and a new business that he is launching in the property sector.
He currently drives 30 to 40 hours each week and says “I do this [driving for Uber] when it gets slow. because in construction sometimes there’s a lot of layoffs. So I just do this in between when I get laid off and then I’ll come back.” While he enjoys all his jobs, property is his real passion, and he hopes to emulate his mother by establishing himself as a full-time realtor.
Alongside a busy work life, he has a three-month-old daughter and shares childcare responsibilities with his wife who works as a recruiter. C.A explains that the flexibility Uber gives him is vital to balancing his career with spending time with his young family. On a typical day he will look after his daughter in the morning, while his wife works, and they will swap in the afternoon. This saves them a significant amount of money on childcare.
Despite his impending property career, C.A is in no rush to give up driving for Uber. He says the last year has shown him parts of the city he never knew existed and introduced him to many interesting people he would otherwise not have met.
How does Uber support economic resilience?
Just as with the general population, drivers and delivery people felt the pinch. 38% of drivers said they felt a little or much worse off than a year ago, of which 83% said the cost of living is becoming too expensive.
As people in Chicago face inflation and rising costs, Uber has seen a rise in the number of registrations from drivers on their platform. Our survey suggested 12% of drivers first started using Uber in the last year and 49% said that the ability to earn money quickly or in an emergency was a key reason behind their decision to work with Uber.
Apps like Uber therefore offer a critical source of income for many people. When delving deeper into the benefits of app-based work:
of drivers agreed that additional income provided by apps has allowed them to cover their rising costs.
of drivers agreed that additional income provided by apps allowed them to save more.
of drivers agreed that additional income provided by apps allowed them to enjoy luxuries and afford non-essential items.
of drivers agreed that their earnings through Uber have helped them feel more financially secure.
Uber has been particularly helpful for those urgently looking for income:
of drivers told us that app-based work helped to pay the bills after losing a more traditional job.
of drivers told us that app-based work has served as a ‘bridge’ between losing one job and gaining another.
of drivers estimated that they had earned money from Uber rides within 7 days of signing up to the app.
Case study:
Woman, 20s
For P.L, Uber is a way of earning extra money alongside her career in armed security. She has worked in the industry for the last five years, and spends her days keeping people safe in hospitals and banks.
She started driving for Uber four months ago after her car broke down and she couldn’t afford to fix it. Through Uber she is now renting a new car, which she uses for Uber trips, but also to commute to her other job and to visit friends and family.
Because of her busy schedule, she only tends to drive for Uber two days a week, normally working between 6am and 3pm. She likes these hours because it gives her time for other things, but also because of the people she meets.
In her words, “Uber in Chicago is for everybody”. Often trips at this time involve taking children to school, helping people catch their flights in time, or getting them to their doctors’ appointments.
Case study:
Man, 40s
Aaron used to work for a nonprofit organization but switched jobs to start driving for Uber because he wanted to earn more money to support his family. He likes his job a lot more now because he finds it easier and spends less time worrying about finances.
When he is not driving for Uber, Aaron is pursuing a master’s in science and technology and hopes to complete the course in March. He studies around driving and likes that when a big deadline is coming up, or he needs to finish an assignment over the weekend he can stop working at a moment’s notice.
He explains “if I worked in an office job, a nine to five, I would have to always do my personal work on the weekends or take leave, but with Uber I could just stop right now and do my personal work.”
Being his own boss is important to Aaron, and he enjoys that nobody tells him when to start and finish work or what hours he must do. He tends to work a few hours on weekday evenings, but works full days on Saturdays and Sundays.
Methodology
Economic Impact
Total Economic Impact
Total economic impact is calculated as the sum of:
- Driver earnings
- Indirect and induced impact of driver spending on vehicles.
- Induced impact of additional driver earnings
This measure is a gross estimate, looking at the total amount of economic activity supported by Uber in Chicago. It does not attempt to measure what would happen in a hypothetical where Uber no longer existed.
Our modeling does not include the impact of Uber’s direct investment or employment footprint as a platform, or any spillover effect this has on the wider tech ecosystem.
Consumer
Consumer Surplus
Following the methodology of Brynjolfsson, Collis and Eggers (2019), we asked riders a single discrete binary choice question in the form:
“Now imagine you had to choose between the following options. Would you prefer to keep access to [Uber for rideshare or go without access to [Uber for rideshare] for one month and get paid $X?”
The price offered was randomized between $1, $2.50, $5, $10, $25, $50, $100, $250, $500.
We then computed a logarithmic regression of the results of this poll to derive a demand curve and the total consumer surplus per user, taking the median as the headline measure. This was then scaled by the number of Uber users.
Time Saved
As part of our polling, we asked riders for the duration of their most recent trip with Uber, and how long the next best alternative would have taken.
We then used the difference to estimate the relative time saved per trip and applied this to data provided by Uber on the average trip duration. We then multiplied by the total number of annual trips to estimate total time saved per year.
Tax Revenue
The average of two approaches was taken to calculate Uber’s direct tax revenue.
The first, a “top down” approach, uses City of Chicago data on total ground transportation tax revenue and calculates Uber’s contribution, taking into consideration the number of taxis and Uber’s market share.
The second approach uses data provided by Uber on the number of rides alongside City of Chicago data on Transport Network Providers to estimate the total number of Uber rides paying each type of surcharge and thus the overall tax revenue generated by Uber drivers.
- https://cnt.org/sites/default/files/publications/CNT_TransitDesertsCookCounty_0.pdf
- Note that participant's names have been changed to respect their privacy.