18 votes

Seattle’s law mandating higher pay for food delivery workers is a case study in backfire economics

63 comments

  1. [21]
    Jordan117
    Link
    Note that this is from an ideologically conservative-libertarian think tank, not exactly a disinterested observer. Personally, I wouldn't trust these gig economy companies farther than I could...
    • Exemplary

    Note that this is from an ideologically conservative-libertarian think tank, not exactly a disinterested observer.

    Personally, I wouldn't trust these gig economy companies farther than I could throw them -- Uber, for instance, was caught misleading regulators with deliberate misinformation about their operations. I wouldn't put it past them to sabotage their business in one market in order to undercut attempts to pass similar laws elsewhere. Just like a company that would rather shutter a factory or pull out of a city than deal with a new union or labor protections.

    99 votes
    1. [20]
      devilized
      Link Parent
      I wonder if individual restaurants who do their own delivery (eg pizza places) could corroborate this claim? I mean, it seems reasonable. There certainly becomes a point where it's just not worth...

      I wonder if individual restaurants who do their own delivery (eg pizza places) could corroborate this claim? I mean, it seems reasonable. There certainly becomes a point where it's just not worth paying for delivery. The more expensive it gets, the fewer people are willing to do it.

      I stopped using delivery services long ago. Between the increased menu pricing on the apps (often 25-30% higher), delivery fees and a tip, I could save almost 50% of the cost by just picking it up myself. If a place needs to charge significantly more to support delivery driver wages, I can absolutely see people forgoing that convenience.

      30 votes
      1. [16]
        papasquat
        Link Parent
        Agreed. I cannot understand the mindset that goes into being able to regularly justify spending that much more for something that's already incredibly expensive (eating out vs cooking at home). It...

        Agreed. I cannot understand the mindset that goes into being able to regularly justify spending that much more for something that's already incredibly expensive (eating out vs cooking at home).

        It also makes me feel incredibly lazy and wasteful. Like, not am I so lazy that I can't be bothered to cook something, but I can't even be bothered to get in the car to go get it either? It feels like a bridge too far too me and the few times I've done it I'm left feeling kind of disappointed in myself.

        13 votes
        1. [8]
          vord
          Link Parent
          Because time is money. Once every other week is, it's nice calling in delivery instead of picking up so that we can spend the 30ish minutes playing with the kids instead of going to pickup. Pickup...

          Because time is money. Once every other week is, it's nice calling in delivery instead of picking up so that we can spend the 30ish minutes playing with the kids instead of going to pickup.

          Pickup is hands-down better if we were out and about doing stuff anyway.

          10 votes
          1. [7]
            Thrabalen
            Link Parent
            There's also the aspect of areas with bad parking. Where I live, parking has gotten so bad that once the car gets a spot, it's there for the weekend. Weekends are also the prime splurge times for...

            There's also the aspect of areas with bad parking. Where I live, parking has gotten so bad that once the car gets a spot, it's there for the weekend. Weekends are also the prime splurge times for delivery.

            7 votes
            1. [6]
              Hollow
              Link Parent
              Funny isn't it, you buy a 10k plus car, so you can find the right spot for it to never leave.

              Funny isn't it, you buy a 10k plus car, so you can find the right spot for it to never leave.

              5 votes
              1. [5]
                Thrabalen
                Link Parent
                The problem isn't one family buying a car. The problem is multiple families buying 2+ cars, in an area that's almost all rowhomes (so, no side yards, so shorter street lengths in front of...

                The problem isn't one family buying a car. The problem is multiple families buying 2+ cars, in an area that's almost all rowhomes (so, no side yards, so shorter street lengths in front of properties), in areas where development is being given to multiple family properties with no consideration toward parking.

                My big concern for car-less cities is that public transportation is inadequate to shop for a full family unless you only buy enough to carry in one go, and then it means making multiple trips a week, and even then it's if you can do so. I can't drive, and I can't carry things terribly long distances, so I have my food delivered. In this situation, it's not even parking, it's vehicle access in general. And I know I'm not alone.

                2 votes
                1. [4]
                  MimicSquid
                  Link Parent
                  Yeah, carless cities would strongly incentivize a network of smaller stores that carry all the essentials at more regular intervals so that you were never more than a few blocks from one. Much...

                  Yeah, carless cities would strongly incentivize a network of smaller stores that carry all the essentials at more regular intervals so that you were never more than a few blocks from one. Much like NYC and its bodegas.

                  4 votes
                  1. [3]
                    Thrabalen
                    Link Parent
                    Which is great for populaces that don't have atypical dietary needs. I have a hard enough time finding sugarless groceries at big markets with a lot of shelf space.

                    Which is great for populaces that don't have atypical dietary needs. I have a hard enough time finding sugarless groceries at big markets with a lot of shelf space.

                    1 vote
                    1. [2]
                      MimicSquid
                      Link Parent
                      Ok, yeah, but it, like most solutions, isn't going to be perfect for everyone. There would be specialty solutions more rarely, much like today, and some people would need alternatives for their...

                      Ok, yeah, but it, like most solutions, isn't going to be perfect for everyone. There would be specialty solutions more rarely, much like today, and some people would need alternatives for their situation, much like today.

                      2 votes
                      1. Thrabalen
                        Link Parent
                        I agree, not everything is going to work for everyone, but I have two caveats. One is that the food delivery situation is just the example I was working with... there are likely other "one size...

                        I agree, not everything is going to work for everyone, but I have two caveats. One is that the food delivery situation is just the example I was working with... there are likely other "one size doesn't fit all" situation, and they start to add up quickly. The other caveat is that when it comes to absolute necessities (food and health, such as dietary issues) the solution should work for as close to 100% as possible. I don't care if my clothing selection is limited, I do care if getting food is considerably more difficult.

                        I would love to avoid the road situation America has, but it's going to take a great deal of people thinking about it much harder than I've seen.

                        1 vote
        2. [3]
          Habituallytired
          Link Parent
          For someone like me, it's the cost of being disabled. When I'm in a flare or am injured due to my disability, I can't cook, I can barely get out of bed. It sucks that they're just getting more and...

          For someone like me, it's the cost of being disabled. When I'm in a flare or am injured due to my disability, I can't cook, I can barely get out of bed. It sucks that they're just getting more and more expensive without passing that cost on to the drivers and restaurants. The middle men companies (DD, Uber eats, Grubhub...) just jack the prices up and take all the profit while lowering the payouts to the people actually doing the work.

          It's the same story I've heard with Lyft and Uber - when they started, they were paying out plenty to get people using the stuff, with reasonable prices for the consumer, but over time, as they become saturated with drivers, the price has gone up for the end user, with payouts going down for the drivers (and in this case, the restaurants too, if they're even informed they're on DD's site.....)

          7 votes
          1. [2]
            devilized
            Link Parent
            And yet somehow, even with all of the extra fees going to the middleman, Doordash still isn't profitable. I agree that it sucks that the middleman companies are accounting for much of the increase...

            And yet somehow, even with all of the extra fees going to the middleman, Doordash still isn't profitable.

            I agree that it sucks that the middleman companies are accounting for much of the increase in cost associated with delivery. But the upside (if there is one) is that you're able to get delivery from way more restaurants than before. It used to be a handful of restaurants (usually pizza joints, some chinese takeout places, and chain sandwich shops like Jimmy Johns) that offered delivery. Most restaurants couldn't justify having multiple delivery drivers on their payroll. Now you can get just about anything delivered, but you certainly pay for that privilege.

            9 votes
            1. Habituallytired
              Link Parent
              You absolutely pay for the privilege! I'm happy to pay the drivers for delivering the food and the restaurant for making the food! I'm even happy to pay the company that gives all of this to us in...

              You absolutely pay for the privilege! I'm happy to pay the drivers for delivering the food and the restaurant for making the food! I'm even happy to pay the company that gives all of this to us in one single platform, since that's also a lot of work. I think there is something wrong when everyone is getting charged through the nose and no one is profiting, except the shareholders.

              4 votes
        3. JCPhoenix
          (edited )
          Link Parent
          There's a Pizza Hut and Dominos close to me. When I say close, I mean Dominos is like 6 blocks away, while Pizza Hut is not even a block away; it's literally across the street. I've done delivery...

          There's a Pizza Hut and Dominos close to me. When I say close, I mean Dominos is like 6 blocks away, while Pizza Hut is not even a block away; it's literally across the street. I've done delivery from both a few times, and even DoorDash'd from a couple other nearby restaurants, and like you said, it felt ridiculously lazy. A couple times I was sick, so maybe those were justifiable. But all the other times were simple laziness.

          So I stopped doing that. But it's less about the laziness, and more to save on the delivery fees. Yes, I still get in the car to go pick up my pizzas. I ain't walking 6 blocks with 2 pizzas, a box of bread sticks, and a pasta dish. Interestingly, the Pizza Hut store is drive-thru only; not sure what's up with that. But regardless, I can take the 5-10min to do this and save $5 each time.

          6 votes
        4. [2]
          tanglisha
          Link Parent
          I mostly use it when I'm traveling for work and don't have a car. I'll walk if there's something near the hotel, but often there isn't.

          I mostly use it when I'm traveling for work and don't have a car. I'll walk if there's something near the hotel, but often there isn't.

          2 votes
          1. papasquat
            Link Parent
            Yeah, that's fair. I've used it in similar situations, and in other weird extenuating circumstances, like I'm working from home, no food in the house, and someone schedules an urgent meeting...

            Yeah, that's fair. I've used it in similar situations, and in other weird extenuating circumstances, like I'm working from home, no food in the house, and someone schedules an urgent meeting during my lunch break.

            It's a great option in circumstances like that, but anecdotally, from people I know, most of their business just comes from people who just don't feel like getting into the car to pick up food, which is a mindset I just cannot empathize with at all. (I mean I can, I feel lazy all the time, but the way I'd feel about myself for paying that much solely to avoid a 15 minute car ride is completely not worth it to me)

            3 votes
        5. GenuinelyCrooked
          Link Parent
          We order delivery a lot during the winter. We moved to Sweden from Florida, so we're not well adjusted to the cold, and it can require a lot of layers just to step out of the door. When I order...

          We order delivery a lot during the winter. We moved to Sweden from Florida, so we're not well adjusted to the cold, and it can require a lot of layers just to step out of the door. When I order delivery in the winter, it's as much to save time on laundry as cooking. So many pairs of socks!

      2. vord
        (edited )
        Link Parent
        This has almost always been the case, even in the before times. For a local pizza place circa 2000, It was like $15 for two medium 1-topping pizzas. $2 delivery fee, (scaled up to $5 if you were...

        I could save almost 50% of the cost by just picking it up myself

        This has almost always been the case, even in the before times. For a local pizza place circa 2000, It was like $15 for two medium 1-topping pizzas. $2 delivery fee, (scaled up to $5 if you were +3 miles away) plus tip. In my neck of the woods, that meant a minimum of 25% premium, and that was the cheapskate move of 'keep the change'.

        I suspect that gig delivery is only worth it for restraunts that don't have high delivery throughput. Otherwise they're maybe saving a bit on payroll, but they are definitely losing customers who don't want to pay exorbitant rates.

        One local pizza place has 2 medium 1-toppings delivered for $25+tip. That same order from a gig-delivered pizza place is $35+tip.

        I'm pretty sure food delivery gig economy will collapse on itself once these platforms need to start recouping costs and paying drivers within a margin of error what they were earning as dedicated delivery drivers.

        9 votes
      3. [2]
        TheBeardedSingleMalt
        Link Parent
        On top of the exuberant fees and add-ons, I've never received a meal from one of those places that wasn't cold and soggy by the time it got to us. Not worth paying almost a 50% increase for half...

        On top of the exuberant fees and add-ons, I've never received a meal from one of those places that wasn't cold and soggy by the time it got to us. Not worth paying almost a 50% increase for half the quality

        3 votes
        1. tanglisha
          Link Parent
          One thing I learned quickly when using it a lot was that some dishes do better than others. You can stick a cold curry in the microwave or oven to heat it up, but nothing is going to fix a soft...

          One thing I learned quickly when using it a lot was that some dishes do better than others. You can stick a cold curry in the microwave or oven to heat it up, but nothing is going to fix a soft hamburger bun.

          3 votes
  2. spit-evil-olive-tips
    Link
    this law took effect in January, this talk about how it's "backfiring" has been covered nearly non-stop by our local news. in hindsight I'm a bit surprised it took 4 months before a national...
    • Exemplary

    this law took effect in January, this talk about how it's "backfiring" has been covered nearly non-stop by our local news. in hindsight I'm a bit surprised it took 4 months before a national think-tank like FEE jumped on the bandwagon.

    some background info - the law was passed in May 2022 by a unanimous City Council.

    This legislation was created after a year of intensive stakeholder meetings and public hearings. It comes as a new report reviewing hundreds of records found 92 percent of jobs from app-based companies pay Seattle workers less than the minimum wage.

    in November 2023, we had a local election, which swung the City Council in a significantly more conservative direction. entirely by coincidence, that election also saw large campaign contributions from conservative interests: Outside interests spend more than $1M on Seattle City Council races

    More than $883,000 of that outside money has come primarily from business and real estate interests spending in support of conservative and centrist candidates in the seven district Council races. Labor unions and other progressive groups have marshaled nearly $192,000 in spending so far, primarily in support of progressive candidates but with some spending on centrists.

    that new City Council was seated in January, right as the law came into effect. because of the change in the political lean of the council, I think companies like DoorDash saw an opportunity to lobby for a rollback of the law. and hoo boy, lobby they have. this is just from the official DoorDash blog:

    Jan 13: How We’re Responding to Seattle’s New Delivery Laws

    Feb 20: One Month Later: Evaluating the Harmful Impacts of Seattle’s New Delivery Laws

    April 23: New Data Shows Seattle’s Untested Law has Dire Consequences for Local Businesses and Dashers

    (if you want a fun game, draw a Venn diagram and see how much these official DoorDash press releases overlap with this blog post from the conservative/libertarian "Foundation for Economic Education")

    our new council president is Sara Nelson, who has proposed an updated law that would roll back pretty much all of these labor protections that were passed unanimously in 2022. here is the actual text of the bill; this has a good summary:

    In addition to eliminating the minimum wage for drivers, which worked out to about $26 an hour before expenses, Nelson’s proposal would:

    • Cut drivers’ base per-mile payment from 64 to 35 cents a mile, less than half the federal rate for tax deductions;

    • Eliminate a $5 minimum payment for each delivery offer;

    • Eliminate penalties (currently double pay plus $5,755) imposed on companies that fail to pay drivers;

    • Deny workers the right to file a civil suit against delivery companies that withhold their wages or violate other rights guaranteed by the law;

    • Remove transparency requirements that help workers decide whether to accept a delivery offer, including whether the delivery requires climbing stairs, what’s in the delivery, and the amount of any tips provided in advance;

    • Reduce the amount of time workers have to decide whether to accept an order or lose it from two minutes to 45 seconds;

    • Extend the amount of time companies have to inform workers how much they made on a delivery from 24 hours to 48;

    • Prohibit the city’s Office of Labor Standards—the only city agency that enforces local labor laws—from asking delivery companies for “the production of any record,” including information that would help workers make informed decisions about which apps to work for, unless it’s part of an enforcement action against a company;

    • Bar OLS from adopting rules that “impose additional requirements” of any kind on delivery companies, in perpetuity;

    • Require OLS to give the app companies 30 days (with an option for extensions) to correct most “non-willful” violations before taking any enforcement action;

    • Remove a section prohibiting “adverse actions” by delivery companies that was intended to stop the companies from deactivating, threatening, penalizing, reducing or garnishing pay, or discriminating against workers because they won’t take certain jobs or aren’t available when the companies want them to be on the clock;

    • Allow delivery companies to charge workers a $5 fee (adjusted by the rate of inflation every year) every time they take out their earnings before the end of the company’s “pay period”—an ironic twist, given that the rest of the law insists drivers aren’t employees.

    Sara Nelson is listed as the sponsor of the bill, but somewhat strangely she has also tried to distance herself from it. here's a tweet with a video clip from a city council meeting (or you can go here for the full video and fast-forward to 2h45m25s). she said:

    In public comment this was referred to as "Sara Nelson's proposal" - yes I did advance this legislation but I want to make sure that people recognize this was...an agreement that was forged between Drive Forward and the network companies. whatever people are going to say about Drive Forward, they are an advocacy organization for drivers.

    quick fact check from the pro-labor group Working Washington: Drive Forward Seattle is an Uber-funded business organization whose board is controlled by Uber corporate executives (posted in July 2021, so this was not in response to the current controversy)

    Drive Forward Seattle is classified as a 501c6 business association, a type of organization which exists to advance business interests; this is the same type of organization as the Association of Washington Business, the Seattle Metropolitan Chamber of Commerce, and other business lobbying groups.

    so she's proposing it, but also saying it's not her proposal, that she's just forwarding it along from the companies themselves plus an astroturf lobbying group they set up.

    if you surveyed people across the US and asked them to name what they thought were the top 5 most liberal/progressive cities in the US, I think Seattle would almost certainly make the list. in many ways we are, especially on things like support for LGBT rights. and yet...here is our local politics.

    oh, and as a bonus, while I was googling for the sources above, I came across this story from August 2023 that I had forgotten about: DoorDash to pay $1.6M to its workers for violating Seattle sick time policy

    49 votes
  3. [39]
    Grumble4681
    Link
    I don't really see anything wrong with this. Demand decreased because prices increased. Prices increased to pay people performing that job in that area a living wage. Yes that means that there...

    I don't really see anything wrong with this. Demand decreased because prices increased. Prices increased to pay people performing that job in that area a living wage. Yes that means that there will be a number of drivers that can't keep it as a job anymore because demand decreased. In theory the ones that remain will get paid better, though we'd have to wait to see how it develops to know if it actually works out that way.

    Personally I find that some of the food delivery services had started out so low and with various introductory offers that it misrepresents the real cost of that service and it's not generally economical for most people to actually be using very often. There are certainly some people who can take advantage of it and the economics of it work due to their different circumstances, but for the average it's literally paying someone to drive around for you. It's the same with Uber and Lyft in terms of operating like taxis, they started out with these super low costs and made taxis seem overpriced and outdated (which to an extent they probably were in some areas at least), but now the prices for those services are way higher than they used to be and the drivers still rely on tips. I mean it's nice in a way that it's more of a unified taxi system with an app that makes it easy to engage with the service, but again it's not really economical for the average person to be using this frequently.

    The difference I find with these services especially is the labor/time involved with driving, you can't really speed it up much. The traffic is an external factor to the business. You can pay someone to make you food and it be somewhat economical (though obviously we can recognize that many food service workers aren't paid that much) but you can also streamline the process of making food to minimize labor required per customer. How are you going to streamline delivering someone's Taco Bell order? Of course if you have a large enough service network with enough demand you can potentially localize order delivery better so there's less overall driving, but paying someone to drive you or your food for ~20-30 minutes of their time is not a cost you can really reduce without reducing that person's wage substantially since you can't reduce the time it takes them to complete the task. There's just no way this service can operate on a scale like package delivery from UPS or such plus food delivery is more time sensitive than ordering other random stuff and having it delivered. So you're not just paying someone to deliver whenever it's logistically optimized, you're paying someone to deliver it sooner rather than later. There's a cost to that on-demand type of service in addition to the basic labor costs of someone's time.

    35 votes
    1. [28]
      DavesWorld
      Link Parent
      An excellent point. The economics of capitalism holds "the market" will find the best solutions. If people being paid a living wage means the "solution" isn't feasible anymore, then was it a...

      Personally I find that some of the food delivery services had started out so low and with various introductory offers that it misrepresents the real cost of that service and it's not generally economical for most people to actually be using very often. There are certainly some people who can take advantage of it and the economics of it work due to their different circumstances, but for the average it's literally paying someone to drive around for you.

      An excellent point. The economics of capitalism holds "the market" will find the best solutions. If people being paid a living wage means the "solution" isn't feasible anymore, then was it a solution in the first place? Or was it exploitation? Except most capitalists don't give a fuck if it's exploitive, they just want the money they make from people too desperate or uninformed to be able to say no to the job.

      What would competition for a food delivery job look like? After all, there's a couple different services now aren't there? All gunning for that same market; the market of people who want food delivered affordably. And as far as I know, all the services are basically just competing on price, except they can't do much of that anymore since employees are wising up and venture capitalists want some return on the investment.

      What the fuck happened to the other things they could compete on? That they're so upset they "can't compete" anymore if they're not allowed to lowball employees? And if they're lowballing staff, they're probably looking for ways to lowball the restaurants too. Which I believe they pretty much are, when they charge "service fees" that don't get split with or passed on to the restaurant which provides the food.

      What would actual food delivery competition look like? For a while, until they got in huge trouble for it over being unsafe, Domino's Pizza was "30 minutes or less, guaranteed." It was their entire marketing scheme. Then they landed in the news when their delivery drivers started getting into accidents, and the media ran with it, and eventually Domino's was like "nope, we're done, no more of that" and the 30 minute thing went away.

      But there are ways to speed up delivery without breaking the law or being unsafe. If they could find ways to take time out of the order and prep time? Like, if it takes an average of four minutes for the order to flow from the service to the restaurant, and they could cut that down to 30 seconds, that'd be quicker. If it's usually three to four minutes between the time a driver reaches the restaurant and is then back in the car with the food leaving, finding ways to pull time out of that would be quicker.

      Stuff like that. But, stuff like that would require actual work. The services would have to actually get involved in their business, in what they're doing. As opposed to just having hired a web UI team and a marketing crew, like they do now while they rake in venture capital and steal tips from drivers, where they're doing basically nothing to innovate.

      I mean, one of my favorite books is Snow Crash, by Neal Stephenson. It opens with a pizza delivery driver. And you can see Stephenson actually sat down and spent some level of effort plotting out how it would work. Because in the book, which was written back around the time when Domino's was still 30 minutes or less, the Mafia ran the pizza place Hiro (the opening character) worked for, and there's this whole setup about how the head of the Mafia is going to be incredibly upset if his drivers fuck up and don't get the pizza there on time. Not ordinary upset, but Mafia upset.

      So the cars are all special Costa Nostra pizza delivery cars, with upgraded performance and traffic scan and special tires and so on. The restaurants have a delivery driver dedicated pull-up, and the car and restaurant both have connections for auto-loading of pizza into the cars, electronic handshaking between the order system and the car and the car's navigation.

      The book was written in nineteen ninety fucking two. Before smartphones had even been dreamed up. Before dot com had really been dreamed up. And he'd figured out how you might could go about competing in delivery. Via investment, in both equipment and employees.

      What do today's smartphone enabled delivery services do? Well, they take orders and email them to restaurants, and give the driver mapping to find the restaurant and customer. But that's it, except it turns out what they want to charge for that (somewhere in the area of a minimum of $25 above and beyond the base cost of the food itself) isn't agreeable to consumers.

      Where are the supposed efficiencies capitalism promises will always surface when competitors compete?

      Oh, that's right. They just pay hard-core wealthy playground think tanks to write articles sulking at the very few local areas they didn't manage to get the government drinking the Kool-aid enough to just let them use up employees like dishrags. Whining about how it's not fair, how local government 'ruined' a market with meddling.

      It's like Billy Ray Valentine wisely opined once upon a time. "You know, it occurs to me that the best way you hurt rich people is by turning them into poor people." That might also be the best way to maybe get them thinking about change.

      Now we just need a plan to make more rich people poor. Well, one can dream.

      19 votes
      1. majromax
        Link Parent
        Should you be allowed to pay the neighbour kid $20 to mow your lawn, or $50 and some pizza to babysit your kids for the evening? How about buying a case of beer for your buddies who help you move?...
        • Exemplary

        If people being paid a living wage means the "solution" isn't feasible anymore, then was it a solution in the first place?

        Should you be allowed to pay the neighbour kid $20 to mow your lawn, or $50 and some pizza to babysit your kids for the evening? How about buying a case of beer for your buddies who help you move?

        Should it be legal for you to volunteer to clean up the park, but illegal if you receive a token $10 for a day's work? Does the answer differ if you're an idle tech millionaire versus a homeless person who often sleeps in the park?

        None of these are living wages, but all of them are economic exchanges.

        Or was it exploitation?

        What is exploitation?

        Modern market economics valorizes the voluntary exchange. If two people come to a free agreement to exchange one thing for another, then there's a strong assumption that neither party is left worse off, and often both benefit.

        This isn't always true – there could be hidden coercion, or an asymmetry of information could mean that one party knows more than the other. However, mere difference of bargaining power doesn't change the basis calculation. It can change the distribution of gains from the exchange, but it still won't force someone to make a trade that knowingly leaves them worse off.

        You might be thinking of exploitation in the sense of profit as exploitation, but Marx was a better sociologist than economist[1]. Regulation can affect bargaining power to some degree, but it can't force companies to offer work where they don't want to. The choice of "work or starve" just becomes "or starve", since a company that doesn't enter a market doesn't owe anything to the people it doesn't hire.

        But there are ways to speed up delivery without breaking the law or being unsafe.

        Batched deliveries would do the trick, but that would give up on some of the instant gratification of on-demand delivery. Informally, many drivers operated in this way under the table (even if by stacking deliveries from different apps) in order to boost effective wages.

        [1] — Mind you, Marx was working at the dawn of modern economics, so he deserves a lot of credit as a historical figure. However, much as Freud's psychological theories have either been absorbed into the modern orthodoxy or abandoned, there's very little left to take from Marxist economics as a coherent theory.)

        11 votes
      2. [26]
        unkz
        Link Parent
        Kind of, yes. It’s a means of paying certain people something when they don’t provide enough value to earn a living wage. What else should we do with people who are just kind of… not valuable?...

        If people being paid a living wage means the "solution" isn't feasible anymore, then was it a solution in the first place?

        Kind of, yes. It’s a means of paying certain people something when they don’t provide enough value to earn a living wage. What else should we do with people who are just kind of… not valuable? Better that they subsidize themselves a bit rather than live entirely from the public purse.

        9 votes
        1. [16]
          thecakeisalime
          Link Parent
          I think your premise is flawed. It's working from the basis that these people don't provide enough value to earn a living wage. People shouldn't be required to provide value to live. You're...

          I think your premise is flawed. It's working from the basis that these people don't provide enough value to earn a living wage. People shouldn't be required to provide value to live. You're basically making the same argument that Walmart makes when they don't pay their workers enough and they still have to rely on food stamps. Yes, there's a lot of people who will work for a couple cents less than the "competition" just to get a job, but that doesn't make a good society, and it's why we have things like a minimum wage. The gig economy does the same thing while evading many existing worker protections; it directly pits workers against each other instead of focusing the corporation that isn't paying them enough. Is it better to pay 100 people $100 per week, or to pay 10 people $1000 to deliver those same orders, leaving the other 90 to find something else? Seattle's law has adjusted the demand side of food delivery, and it will take some time for the supply to adjust accordingly.

          There are plenty of things that "not valuable" people can do for society that don't just give their time and labour directly to a corporation. Picking up trash from public spaces, maintaining public parks, teaching/assisting with workshops at the public library, sorting books at the same library, etc. The government is already paying for these people (often via food stamps), why not just pay them real money and give them a job that helps society?

          And if there's not enough jobs to make society better? That's where something like universal basic income comes into play.

          18 votes
          1. [14]
            majromax
            Link Parent
            You seem to be operating from one hidden premise, that it's the employer's responsibility to ensure that the employee doesn't starve. This isn't outlandish, but it's also not obvious. If my...

            I think your premise is flawed. It's working from the basis that these people don't provide enough value to earn a living wage. People shouldn't be required to provide value to live

            You seem to be operating from one hidden premise, that it's the employer's responsibility to ensure that the employee doesn't starve.

            This isn't outlandish, but it's also not obvious. If my employer just has to pay me for time worked, then my life is my own. If my employer also has a responsibility to make sure I don't starve, then arguably they should have much more control over my life, such as coercing me to make "wise" choices like buy healthy vegetables rather than beer.

            This idea is also pre-modern, in the sense that it fits well in a quasi-feudal society with land-owning manor lords and land-renting peasantry. Again, this kind of society is organized around that economic hierarchy, so the rich are not just economic Big Men but also expressly at the top of the social hierarchy.

            In the modern market economy, we also have the problem that jobs aren't fixed. A land-owning nobleman needs a relatively fixed quantity of labour to farm the fields, and if they don't have that labour the fields lay fallow. A factory, however, can be built in many places, and many service jobs are even more flexible (not needing heavy infrastructure).

            If the law forces companies to take unwanted responsibility for social problems, then many companies can simply relocate or not enter the market, leaving the region to a weird kind of autarky.

            The goal of general welfare is laudable, but I don't think it can be achieved by devolving individual responsibility to the unwilling. It needs to be treated at the whole-society level, using the broadest powers that offer the fewest avenues for escape. In particular:

            You're basically making the same argument that Walmart makes when they don't pay their workers enough and they still have to rely on food stamps.

            I think this is something closer to a policy success: people are better off than if unemployed, and they also don't starve. Even under the framework that Wal-Mart's profits are exploitation, it seems like the simpler answer is to tax the profits to fund the welfare programs. If we're unable to come to come to a consensus as a society that we need to appropriately fund welfare programs, that's an indictment of us rather than of Wal-Mart.

            12 votes
            1. [2]
              thecakeisalime
              Link Parent
              That's a fair reframing, and I think I agree with most everything you said. However, this law is Seattle's attempt to force companies to align their businesses with society's values. As a city,...

              That's a fair reframing, and I think I agree with most everything you said.

              However, this law is Seattle's attempt to force companies to align their businesses with society's values. As a city, they don't have a huge amount of options. Profit taxing and redistribution really needs to start at the state level, if not the federal level.

              I do think that once society has reached the point where it's properly taxing profits and redistributing it as something like a UBI, that things like minimum wage will be unnecessary (and possibly even counterproductive). But until the larger governments do something about it, this is probably the best thing that Seattle can do.

              9 votes
              1. majromax
                Link Parent
                That begs the question that the city is a reasonable jurisdiction to implement this goal. Cities are obviously best-placed to handle local issues, but I'm not sure if values-alignment of...

                However, this law is Seattle's attempt to force companies to align their businesses with society's values.

                That begs the question that the city is a reasonable jurisdiction to implement this goal.

                Cities are obviously best-placed to handle local issues, but I'm not sure if values-alignment of businesses (or economic redistribution, depending on your framing) is truly a local issue.

                4 votes
            2. [10]
              mat
              Link Parent
              I'm not sure that they were doing that. "Paying a living wage" is not the same thing at all as "being responsible employees don't starve". I don't see society forcing companies to pay workers...

              You seem to be operating from one hidden premise, that it's the employer's responsibility to ensure that the employee doesn't starve.

              I'm not sure that they were doing that. "Paying a living wage" is not the same thing at all as "being responsible employees don't starve".

              I don't see society forcing companies to pay workers enough that they don't starve in return for a fair amount of work requires the company to take any responsibility for social issues. Other than the social issues their exploitation of people's labour has caused in the first place, of course. Which is their fault, so perhaps that's a good thing for them to be made to be responsible for.

              It needs to be treated at the whole-society level, using the broadest powers that offer the fewest avenues for escape

              I have an idea. Perhaps we make sure that all jobs are paid such that nobody working a reasonable amount of hours (let's say 35 hours a week) needs state support to not starve and have basics like shelter, heating and so on.. that's a broad-power, whole-society move and should be reasonably inescapable.

              6 votes
              1. majromax
                Link Parent
                Again, could someone please define exploitation? How can I look at an employment contract and decide if it's exploitative, in a policy-meaningful sense? First, that would seem to lead to the poor...

                Other than the social issues their exploitation of people's labour has caused in the first place, of course.

                Again, could someone please define exploitation? How can I look at an employment contract and decide if it's exploitative, in a policy-meaningful sense?

                Perhaps we make sure that all jobs are paid such that nobody working a reasonable amount of hours (let's say 35 hours a week) needs state support to not starve and have basics like shelter, heating and so on.. that's a broad-power, whole-society move and should be reasonably inescapable.

                First, that would seem to lead to the poor effects alleged in the here-linked article. For living-wage laws to result in a truly living wage, you need to presuppose that full-time work is generally available. Under conventional economics, that's not a given when the minimum wage is raised too far.

                Second, I'm not sure this is even a desirable outcome because of the free exchange it restricts. Should I be forbidden from paying the neighbour's teen $50 to watch my kids for the evening, solely because at an annualized 35hr/wk rate it doesn't result in a living wage?

                Third, what of genuine self-employment? New business-owners often can't pay themselves a wage at all, let alone a living one, while their business starts before they have clients/customers. A freelancer who takes a job with a fixed project fee might underestimate the amount of work it will take, resulting in a non-living wage through only their own actions. It seems coercive to have the government come in and tell these people that they're criminal for underpaying themselves.

                4 votes
              2. [8]
                unkz
                Link Parent
                This is possible, but only if we exclude certain people from the job market entirely. Why should we prevent people who are not capable of generating sufficient value to support themselves from at...

                I have an idea. Perhaps we make sure that all jobs are paid such that nobody working a reasonable amount of hours (let's say 35 hours a week) needs state support to not starve and have basics like shelter, heating and so on.. that's a broad-power, whole-society move and should be reasonably inescapable.

                This is possible, but only if we exclude certain people from the job market entirely. Why should we prevent people who are not capable of generating sufficient value to support themselves from at least partially supporting themselves?

                3 votes
                1. [7]
                  mat
                  Link Parent
                  I'm not sure I understand what you're saying, sorry. Can you clarify a little? There is a reading of what you said that involve treating groups such as the disabled as second class workers who...

                  I'm not sure I understand what you're saying, sorry. Can you clarify a little?

                  There is a reading of what you said that involve treating groups such as the disabled as second class workers who should be paid less and I'm sure that is not what you intended.

                  6 votes
                  1. [5]
                    majromax
                    Link Parent
                    Suppose I run a widget factory. Net of material inputs and capital costs (maintenance, depreciation), I can sell widgets for a gross profit of $10 apiece. The living wage in my area is $30/hr. If...

                    There is a reading of what you said that involve treating groups such as the disabled as second class workers who should be paid less and I'm sure that is not what you intended.

                    Suppose I run a widget factory. Net of material inputs and capital costs (maintenance, depreciation), I can sell widgets for a gross profit of $10 apiece. The living wage in my area is $30/hr.

                    If I have workers who produce at least 3 widgets an hour, then I'm capable of paying them a living wage, and whether or not I do that is a matter of relative bargaining power. The law and regulations can push here in the workers' favour.

                    However, what if I have a worker who can't produce 3 widgets per hour? This could be someone with a disability, or it could also be a new worker undergoing training who just isn't yet proficient. In either case, their output isn't capable of supporting a living wage. The living wage law would force me to take a net loss on the worker, subsidizing the living wage out of either profits (the intention, presumably) or the wages of other, more productive workers. It's to my advantage to just not hire these underperforming workers, leaving them as someone else's problem or as wards of the state.

                    This does not seem a desirable outcome. Extra widgets don't get made, and the workers who could most use the living wage don't receive one at all.

                    2 votes
                    1. [4]
                      sparksbet
                      Link Parent
                      But what's the alternative here? These underperforming workers don't get a living wage either way, so they're either unable to subsist or they're wards of the state either way. The only difference...

                      But what's the alternative here? These underperforming workers don't get a living wage either way, so they're either unable to subsist or they're wards of the state either way. The only difference is that your business gets to profit off however many widgets they can make per hour without covering their ability to subsist.

                      The fact that you refer to new workers undergoing training is a great example here -- it is absolutely normal to not expect workers to be productive while they're still being trained, and it would be fucking dystopian not to pay them a living wage during their training. In the US and many other countries there are laws requiring workers to be paid during their training specifically because companies would attempt to exploit workers by getting free or significantly underpaid labor from them while they were training. Businesses should be forced to subsidize employees while they're training.

                      6 votes
                      1. [3]
                        majromax
                        Link Parent
                        What profit? Remember that in the thought experiment above, the subsidy problem still happens even if there's no profit left for the owners. Then, the subsidy comes at the expense of other, more...

                        The only difference is that your business gets to profit off however many widgets they can make per hour without covering their ability to subsist.

                        What profit? Remember that in the thought experiment above, the subsidy problem still happens even if there's no profit left for the owners. Then, the subsidy comes at the expense of other, more productive workers.

                        Besides that, if the disabled worker would be a 'ward of the state either way,' it does affect the state's budget whether it's on the hook for the equivalent of $30/hr (a full 'living wage' equivalent) or just $10 (the difference between the paid wage and a living one).

                        The fact that you refer to new workers undergoing training is a great example here -- it is absolutely normal to not expect workers to be productive while they're still being trained, and it would be fucking dystopian not to pay them a living wage during their training.

                        Or, I don't hire trainees, and instead I use the cross-subsidy saved to improve the wages of expert employees. The factory across the street can pay its trainees a living wage, but as soon as they're competent I'll hire them away with a nice pay increase.

                        As a Nash equilibrium, this ends up with no company providing training. Instead, we all demand that prospective workers complete a community college curriculum on widget-making at their own expense, perhaps with an un(der)paid internship for credit. Even if we can't completely eliminate training, we can minimize the period for which we're on hook to pay the trainees.

                        4 votes
                        1. sparksbet
                          Link Parent
                          I think our disagreements are less in the practical realities here and more in my disgust at the amount of control that companies like this have over people's ability to subsist.

                          I think our disagreements are less in the practical realities here and more in my disgust at the amount of control that companies like this have over people's ability to subsist.

                          5 votes
                        2. Tigress
                          Link Parent
                          No one is going to pay trainees a living wage if they don't have to. And what would happen is that they'd start just hiring trainees and finding a reason to fire them so they never had to pay...

                          No one is going to pay trainees a living wage if they don't have to. And what would happen is that they'd start just hiring trainees and finding a reason to fire them so they never had to pay higher wages. You don't think like a corporation at all.

                          And why the fuck would the guy across the street decide to pay trainees a living wage when other people aren't? There is absolutely no incentive to do that, especially if all that happens is you train them and they get poached by the company across the street.

                          4 votes
                  2. unkz
                    Link Parent
                    I'm not arguing that anyone "should" be paid less, but I am saying that there are people who can't be profitably paid a living wage to do a job because employing them would be a net cost. What are...

                    who should be paid less

                    I'm not arguing that anyone "should" be paid less, but I am saying that there are people who can't be profitably paid a living wage to do a job because employing them would be a net cost. What are the options for these people? If we demand that they be paid a living wage if they work, then they will be de facto excluded from the job market because they are not usable as employees at that rate.

                    Or are you suggesting that corporations should be required to hire people at a living wage rate to do jobs they aren't capable of as some kind of compulsory welfare program?

                    2 votes
            3. GenuinelyCrooked
              (edited )
              Link Parent
              This is part of why we often talk about compensation in terms of payment per hour. If the employer is only paying for you time worked, but the payment is not enough to ensure that you do not...

              If my employer just has to pay me for time worked, then my life is my own. If my employer also has a responsibility to make sure I don't starve, then arguably they should have much more control over my life,

              This is part of why we often talk about compensation in terms of payment per hour. If the employer is only paying for you time worked, but the payment is not enough to ensure that you do not starve and the time left over is not enough that you can do other things to ensure that you don't starve, then employer is not paying enough for this type of exchange to exist in a sustainable society. This is a problem with the gig economy because dollars received per hour can vary so drastically and be so precarious. The exact amount that the worker will receive is often not known when they agree to sell their time.

              4 votes
          2. unkz
            Link Parent
            I'm not 100% clear on this proposal. Are you saying that the government should require people to work for the government in order to get welfare? What if they don't? Or what if they are just......

            There are plenty of things that "not valuable" people can do for society that don't just give their time and labour directly to a corporation. Picking up trash from public spaces, maintaining public parks, teaching/assisting with workshops at the public library, sorting books at the same library, etc. The government is already paying for these people (often via food stamps), why not just pay them real money and give them a job that helps society?

            I'm not 100% clear on this proposal. Are you saying that the government should require people to work for the government in order to get welfare? What if they don't? Or what if they are just... bad at the job, for the same reasons that they aren't good enough at working to do a job for a company?

            6 votes
        2. [9]
          LukeZaz
          Link Parent
          I’m going to be charitable and assume that by “not valuable” (a very gross choice of words) you mean “low-skill.” Not that that should matter, since “low-skill” jobs are still necessary for...

          What else should we do with people who are just kind of… not valuable?

          I’m going to be charitable and assume that by “not valuable” (a very gross choice of words) you mean “low-skill.” Not that that should matter, since “low-skill” jobs are still necessary for society to function and people working them deserve living wages too.

          Better that they subsidize themselves a bit rather than live entirely from the public purse.

          U.S. welfare is anemic at best. You are presuming these people aren’t simply left to die.

          2 votes
          1. [8]
            unkz
            Link Parent
            No, I don't really mean "low-skill". As you rightly point out, there are lots of low-skill jobs out there that have economic value. What I mean is low-capability. There are people who are not...

            No, I don't really mean "low-skill". As you rightly point out, there are lots of low-skill jobs out there that have economic value. What I mean is low-capability. There are people who are not capable of producing sufficient economic value to support themselves. They may even be "high-skill" workers who are simply incapable of working efficiently enough. As an employer, if I have a software developer who takes 10x as long as another, I can't pay them $100k/year if they only generate $10k/year of value.

            3 votes
            1. [7]
              DefinitelyNotAFae
              Link Parent
              Fundamentally many of us don't see people in terms of economic value. Never mind that plenty of disabled people who can't make a widget can in fact run orders at a restaurant or greet people at a...

              Fundamentally many of us don't see people in terms of economic value. Never mind that plenty of disabled people who can't make a widget can in fact run orders at a restaurant or greet people at a welcome desk or maybe just need adaptation to be able to make the widget just fine.

              "Better they work and subsidize themselves rather than living off the public purse" is really not that far off from Scrooge and his comments about workhouses and prisons.

              I have worked for employers that see me as a person with worth beyond my ability to produce, and I've worked for employers that didn't. It is better for individuals, society and employers that we do the former rather than the latter.

              Employers that just want to exploit their labor like an endless pool of resources to be replaced at will get subpar work. Sure they come out ahead in the same way that the companies that strip mine our land come out ahead. If we must insist on seeing people as numbers of value, perhaps it's ideal to see them as a valuable natural resource that should not be exploited because of the huge negative societal effects.

              5 votes
              1. [6]
                unkz
                Link Parent
                Whether people are "seen in terms of economic value" is kind of irrelevant though. People do in fact have a quantifiable economic value, whether it is seen or not. It's great if some companies...

                Whether people are "seen in terms of economic value" is kind of irrelevant though. People do in fact have a quantifiable economic value, whether it is seen or not. It's great if some companies decide to be charitable and spend money on staff that ultimately cost them money, but that's not sustainable on a large scale.

                2 votes
                1. [5]
                  DefinitelyNotAFae
                  Link Parent
                  It is relevant because we've seen throughout history that when people commoditize other people they do so through all the historical systemic biases that we've seen play out - disabled people are...

                  It is relevant because we've seen throughout history that when people commoditize other people they do so through all the historical systemic biases that we've seen play out - disabled people are worthless, women can't do heavy labor, immigrants and Black folks are only good for physical labor, etc. we already don't value the people who produce our food despite that being far more important than the people that sell stocks.

                  I'd be horrible at working in a greenhouse, I'm great at dealing with mental health and basic needs and helping people deal with crises. I can't code more than an html webpage and probably not that anymore. What's my "value" as a human?

                  It's not charity to not view people as only worth what they produce.

                  6 votes
                  1. [4]
                    unkz
                    Link Parent
                    You’re conflating two separate kinds of value. There’s economic value, and then there’s this amorphous, unquantifiable “human” value. However interesting that latter value is to some people, it...

                    What's my "value" as a human?

                    You’re conflating two separate kinds of value. There’s economic value, and then there’s this amorphous, unquantifiable “human” value.

                    However interesting that latter value is to some people, it doesn’t pay for rent and groceries. We have to do that with economic value.

                    Discrimination is wrong. We should rightly condemn and prohibit people from employed based on, as you mention, being disabled, female, immigrant, or black. Why then should we allow discrimination based on not being capable of generating a threshold level of economic output?

                    3 votes
                    1. [3]
                      DefinitelyNotAFae
                      Link Parent
                      I'm not, though; my "economic" value will vary depending on who is assessing me. A greenhouse manager will think I'm an idiot. A programming manager will think I'm useless. My boss thinks I'm a...

                      I'm not, though; my "economic" value will vary depending on who is assessing me. A greenhouse manager will think I'm an idiot. A programming manager will think I'm useless. My boss thinks I'm a wizard. Which is true? It's not a static thing and there are not "low-value" and "high-value" people unless you believe in a single objective truth about that sort of valuation. As much as I object to the entire framework, I also think that even if you assume that the framework could exist, it doesn't actually make any sense to make objective claims.

                      I also think that looking at humans that way is a bad framework.

                      2 votes
                      1. [2]
                        unkz
                        Link Parent
                        One’s economic worth is more or less the maximum of what the set of all available employers are willing to pay for their services. This is a dynamic value insofar as the job market is dynamic, but...

                        One’s economic worth is more or less the maximum of what the set of all available employers are willing to pay for their services. This is a dynamic value insofar as the job market is dynamic, but it is objective and not tied to a single assessor.

                        There clearly exist people whose value under this metric is low, and below a living wage.

                        1 vote
                        1. DefinitelyNotAFae
                          Link Parent
                          This all came from the assumption that "low value" people should work for lower wages and at least do something to subsidize their public assistance. That is a particular economic model that does...

                          This all came from the assumption that "low value" people should work for lower wages and at least do something to subsidize their public assistance. That is a particular economic model that does not align with my own opinions. We're at an impass, but fundamentally I don't agree with your perspective or this particular model of conceptualizing human beings, nor do I think anyone can actually objectively calculate an actual economic worth, certainly not without ignoring vast amounts of necessary unpaid labor that isn't "economically valuable" by that metric.

                          But then, as Dickens noted, there are still prisons and workhouses and anyone not satisfied to work at a deeply underpaid job should just see themselves off.

                          2 votes
    2. [10]
      papasquat
      Link Parent
      Here's what I don't get. Pizza and Chinese places have done delivery for decades, and they were able to do it at the same cost of dine in food, plus a pretty small tip for the driver. That...

      Here's what I don't get.
      Pizza and Chinese places have done delivery for decades, and they were able to do it at the same cost of dine in food, plus a pretty small tip for the driver. That business model seemed to have been sustainable, because basically every Chinese and pizza places business model was built around it and it had been profitable for years.

      As soon as Uber eats, door dash, GrubHub and the like came around, that same pizza delivery would cost you an additional 50% on top of the regular price, plus a tip.

      Obviously the drivers aren't being paid great, and the companies are now just barely starting to become profitable, and the restaurants aren't getting additional money, so what gives?

      Were delivery restaurants operating at a loss with deliveries? Did in person dining subsidize the delivery costs? Did they just inflate their prices across the board so that delivery could be profitable? Did people previously tip much better?

      9 votes
      1. [4]
        Omnicrola
        Link Parent
        Offhand speculation : the Chinese/pizza places often had/have very strictly defined delivery areas that restricted how long/far a driver had to go. They also often had a minimum order size. AFAIK...

        Offhand speculation : the Chinese/pizza places often had/have very strictly defined delivery areas that restricted how long/far a driver had to go. They also often had a minimum order size. AFAIK the modern apps don't have a delivery radius limit (and if so, is so generous that I've never encountered it).

        7 votes
        1. [2]
          sparksbet
          Link Parent
          Almost every food delivery app is going to have a delivery radius limit -- they just generally don't show you restaurants that won't deliver to you.

          Almost every food delivery app is going to have a delivery radius limit -- they just generally don't show you restaurants that won't deliver to you.

          11 votes
          1. redwall_hp
            Link Parent
            Yep...though now they're finding a way to drip price that to. DoorDash has started tacking on an additional, visible $10 fee for some restaurants that are outside of the normal delivery radius. (I...

            Yep...though now they're finding a way to drip price that to. DoorDash has started tacking on an additional, visible $10 fee for some restaurants that are outside of the normal delivery radius. (I assume the driver doesn't see any of that, of course.)

            So you can eat the marked up menu price, delivery fee (or DashPass), a tip for the driver, and now an extra $10 for being a little further away for your fast food burger.

        2. ThrowdoBaggins
          Link Parent
          I’ve used a lot of different delivery apps, and ordered to my own home or to a friends place or moved house, so I can confirm there are definitely limits to delivery radius (although how that...

          I’ve used a lot of different delivery apps, and ordered to my own home or to a friends place or moved house, so I can confirm there are definitely limits to delivery radius (although how that compares to pre-delivery-app radii I have no idea) because sometimes I’ll be ordering from a place and adding items to my cart, and then realise the address is incorrect and change it, and then the app will tell me that I can’t order from that store anymore due to distance. Usually phrased like “this restaurant doesn’t deliver to your area”

          Sparksbet is correct that once you update your address, the restaurants just vanish from the list of options.

          Many (all?) delivery apps these days ask you for a location or address before they’ll show you the list of stores to scroll through.

          1 vote
      2. Macha
        (edited )
        Link Parent
        Two possible explanations: When there were fewer players in the delivery space, then more delivery orders went to fewer players. If you're the only pizza place doing delivery in your vicinity in a...

        Two possible explanations:

        When there were fewer players in the delivery space, then more delivery orders went to fewer players. If you're the only pizza place doing delivery in your vicinity in a dense city, then you can probably batch deliveries and send your driver out with 2/3/4 deliveries and deliver while still warm. When app based delivery puts way more restaurants in range, then suddenly the order base is way more spread out so even if you get the same number of orders, they're no longer geographically clustered and so you're sending 1 driver, further, with one pizza.

        There's also the tradeoff with customer acquisition costs. If the product costs $8 to make and $4 to deliver, and you sell it for $15 with no delivery charge, then each onsite order earns $7 and each delivery earns $3. But if offering delivery earns you extra customers at 3x the rate that customers switch from collection to delivery, that may still increase your net profit even if eats your margin. This is fine within one business, that $4 is effectively like a marketing cost. But once delivery is externalised, well Uber Eats isn't going to deliver to your customer for minus 4 dollars. So they're either going to pressure you to sell them the pizza at a discount or pass that fee to the customer, along with their own markup. And in a world where everyone in a 15 mile radius is doing delivery, the competition is much higher so it's harder to get that customer quantity boost just by doing delivery.

        7 votes
      3. sparksbet
        Link Parent
        ...I mean, it's pretty obvious that there's a huge chunk of people in the equation that weren't there before -- people who work for these middleman food delivery companies who aren't delivery...

        ...I mean, it's pretty obvious that there's a huge chunk of people in the equation that weren't there before -- people who work for these middleman food delivery companies who aren't delivery drivers. They not only need to get paid, but have always been making way more than a delivery driver.

        I'm also 100% sure these food delivery companies are deliberately passing costs from these minimum wage laws onto consumers to attempt to influence public sentiment against these laws.

        4 votes
      4. [3]
        skybrian
        Link Parent
        Maybe some of those businesses didn’t pay their workers very much? Immigrants being willing to work for low wages is a thing. Rising wages change the economics of lots of businesses, sometimes to...

        Maybe some of those businesses didn’t pay their workers very much? Immigrants being willing to work for low wages is a thing.

        Rising wages change the economics of lots of businesses, sometimes to the point where they no longer make sense and we do without. Full service gas stations, for example.

        The US is adjusting to depend less on low-wage workers in a variety of ways, including automation, self-service, outsourcing to other countries with lower wages, and just paying a lot more for some things (healthcare, day care).

        3 votes
        1. [2]
          vord
          (edited )
          Link Parent
          While they don't, the delivery drivers were making bank compared to most of the rest of the staff. Back when I worked for a family restaurant, the earning ranks were roughly like this: Owner...

          While they don't, the delivery drivers were making bank compared to most of the rest of the staff.

          Back when I worked for a family restaurant, the earning ranks were roughly like this:

          1. Owner
          2. Management
          3. Head chef
          4. Delivery drivers (higher minimum wage, but high tips)
          5. Waitstaff (minimum wage, but high tips)
          6. Table bussers (slightly higher than minimum wage, but got a small tip cut from waitstaff)
          7. Host staff (reservations/phone calls/checkout/seating customers) (roughly same wage as bussers, no tips)
          8. Cooks/Dishwashers (minimum wage or less, often illegal immigrants)

          Full service gas stations, for example.

          Nah, that's just businesses cutting out because they can. I pay the same or less for gas in New Jersey as I did in PA, and every pump is full service. I've also got several years of experience working gas stations. Honestly, the lack of people breaking gas pumps and spilling gas everywhere makes up for a good amount of the wages there....you would be surprised how many people just drive off with the nozzle still attached to their car. Gas was almost always a revenue-neutral thing, it was all about bringing people in to buy smokes (also low margin, but high volume) and snacks. The markup on snacks is unbelievably high, and could have supported a $20/hour wage circa 2004.

          6 votes
          1. skybrian
            Link Parent
            Yeah, that tracks. But I see restaurants trying to get away with less staff nowadays. There are somewhat upscale places (as far as the food they’re selling) that work like a fast food restaurant...

            Yeah, that tracks. But I see restaurants trying to get away with less staff nowadays. There are somewhat upscale places (as far as the food they’re selling) that work like a fast food restaurant where you order at the counter, bus your own stuff at the end, and use disposable utensils. Also, during the pandemic they got people used to using your phone to order, so some places do that now. I’ve seen a service where the bill has a QR code you can use.

            In hotels, daily maid service seems to be rare since the pandemic?

            Businesses are complicated and it can be hard to tell what’s a loss leader. They will try stuff. It kind of doesn’t matter if it’s a loss leader or not; cutting costs is something they’re going to try. Gotta pay the rent somehow.

            1 vote
  4. skybrian
    Link
    Some complications that I don’t think have been considered: Some cities are much more dense than others, which changes the economics. People aren’t all the same. Delivery might make more sense for...

    Some complications that I don’t think have been considered:

    • Some cities are much more dense than others, which changes the economics.

    • People aren’t all the same. Delivery might make more sense for parents or if the customer has a disability.

    • Delivery workers can do deliveries using different methods than their customers (bike messenger, e-bike, scooter) so they’re less affected by traffic and parking hassles.

    • Restaurants can move closer to the customer. There are some “restaurants” that are just a kitchen and only do delivery orders. There are food trucks.

    • Tastes can change. There might be new foods (or traditional foods that are newly popular) that are particularly suitable to delivery.

    The ways that businesses change to improve efficiency aren’t necessarily all that high tech.

    10 votes
  5. tanglisha
    Link
    This is the same person cited in the article. Whether or not you agree with his conclusions, it seems to me that these changes did in fact result in more capitalism in his specific case. Setting...

    This is the same person cited in the article. Whether or not you agree with his conclusions, it seems to me that these changes did in fact result in more capitalism in his specific case.

    Setting that aside, I notice that restaurant income isn't mentioned anywhere in the original article. There are three parties involved here, it's not all about the drivers and delivery companies. I'll preface this by saying it's unusual to find a Seattle business that doesn't have a website. For the entrenched, this is not typical.

    Watch out for fake restaurant websites thanks to delivery service’s shady plan

    An investigation by New Food Economy found that GrubHub is registering web domain names that sound very much like those of the restaurants affiliated with the service. On top of that, GrubHub is using those domain names to build shadow websites with fake phone numbers of the restaurants already working with GrubHub.

    The article is from 2019, I can't find anything current on if GrubHub is still doing this.

    Delivery companies always act like their fees are set in stone. It's therefore bad if they have to pay drivers more or if restaurants raise their prices, because it puts drivers out of work, which is obviously the fault of either the government or the person who orders take out instead of delivery.

    30% is a really hefty fee. A delivery for more than one person could easily reach $100, $30 of which goes straight to the delivery company.

    None of this is happening in a vacuum.

    6 votes