[New York Diary] Minimum Wage More Than Doubled, but Discontent Remains..."Who Will Order Delivery Now?"

Minimum Wage for Delivery Workers in New York Raised to $17.96 per Hour
"Historic Advancement" or "No One Is Satisfied"?
Pushback from Both Platform Companies and Workers Over the New Policy

The city of New York in the United States has decided to significantly raise the minimum wage for food delivery workers. Starting next month, the minimum wage for delivery workers using food delivery applications such as Uber Eats, DoorDash, and Grubhub will be increased to $17.96 per hour. This rate far exceeds the federal minimum wage ($7.25) as well as the New York State standard ($14.20). Compared to the current average hourly wage of $7.09 for 60,000 delivery workers in New York City, this is nearly three times higher, making it a major "historic advancement" for delivery workers and labor organizations. However, locally, the decision has been met with evaluations that "no one is satisfied." What is the reason?

[Image source=AP Yonhap News]

The pushback from platform companies facing sharply increased costs is easily anticipated. DoorDash stated, "We do not oppose the minimum wage, but this is an extreme policy that exceeds industry standards." Uber Eats pointed out that the excessively raised minimum wage could actually harm delivery workers. These companies have also announced that they are considering legal action.

However, significant dissatisfaction can also be seen among the delivery workers who will receive the increased minimum wage. These complaints can be broadly categorized into two types. First, considering New York City's cost of living and bike rental expenses, an hourly minimum wage around $18 is still insufficient. This includes New York’s world-class high cost of living, but a bigger factor seems to be that New York City’s final decision is much lower than the $24 per hour proposed last November. Some even criticize that New York City has tacitly accepted lobbying by app companies. The decision on the minimum wage for delivery workers in New York City was delayed by about six months from the original schedule.

Moreover, most delivery workers currently bear the cost of renting delivery bikes themselves. For example, renting a JOCO electric bike for six hours a day costs $65 per week. Brad Lander, New York City Comptroller, pointed out, "An $18 hourly wage, excluding these costs, is about $13," and emphasized, "The minimum wage should be paid excluding these expenses." At public hearings held by New York City before the minimum wage decision, it was also pointed out that platform companies do not take responsibility for various risks delivery workers face on the job, such as accidents, theft, and assaults. There are calls for the minimum wage decision to fully consider these factors.

On the other hand, the second type of view is skeptical, seeing this as "news that sounds good on the surface," but uncertain about where its repercussions will spread. After the news broke, many delivery workers expressed their concerns on U.S. community sites such as Reddit, saying, "It doesn’t seem possible to pay all delivery workers this much increase," and "The intention is good, but if you look closely, there’s a catch."

A delivery worker at DoorDash said, "We learned how supply and demand worked during the pandemic," and evaluated, "This number (minimum wage) will compensate for future decreases in delivery orders and tips." Another delivery worker questioned, "If someone orders $30 worth of food and it becomes $55 excluding tips, will that customer order delivery or pick it up themselves? And how many customers will tip after paying high delivery fees?"

New York City’s move started from the judgment that the basic livelihood of delivery workers suffering from poor treatment must be stabilized. However, one of the important factors that must be considered in minimum wage decisions in any country is inevitably "payment capacity" and "social consensus." Platform companies are expected to pass these increased costs on through price hikes. Ultimately, the last group dissatisfied with this decision will be the majority of American consumers, who are already exhausted by soaring inflation and tipflation (tips + inflation).

This content was produced with the assistance of AI translation services.