China’s ride-hailing drivers face challenges amid slowing economy.
China's ride-hailing drivers face challenges amid slowing economy.
The Struggle of Chinese Ride-Hail Drivers
Shanghai driver Zhu Zhimin works 15 hours a day to earn the same money he was making only a few months ago working a regular shift, as he competes with an increasing number of Chinese rushing into the ride-hailing industry.
Zhu Zhimin’s life has become a relentless cycle of long hours and unrelenting fatigue. From early morning to late at night, he ferries passengers around the bustling streets of Shanghai, trying to make ends meet. But despite his tireless efforts, the money he earns is not what it used to be. Zhu is just one of the millions of ride-hail drivers in China whose income has been eroded by an oversaturated market. With weak post-pandemic recovery and record youth unemployment, more people are turning to the ride-hailing sector as a means of survival.
“The competition is fierce,” says Zhu, his voice filled with exhaustion. “I have to work longer hours just to make the same money I used to make before. There’s no time for a break, no spare time at all.”
Zhu’s desperation stems from the fact that his family relies on his income. As his children grow older and his parents age, the financial pressure continues to mount. Like many other drivers in China, he feels trapped in a never-ending cycle of work and sacrifice.
China’s ride-hailing market has seen a sudden influx of drivers, with approximately 400,000 people joining the industry between April and July this year, according to the Ministry of Transport. This surge in driver numbers reflects the subdued job market, where traditional employment opportunities have become increasingly scarce.
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“The downturn of the socio-economic environment led to a reduction in job opportunities and an influx of labor into the ride-hailing industry,” explains Wang Ke, an analyst at Analysys, a market research firm. “An increasing number of unemployed individuals make the ride-hailing industry their first choice.”
With more than 300 ride-hailing apps in China, accounting for over 40% of total taxi trips last year, the market is saturated. Cities like Shanghai, Sanya, and Changsha have suspended issuing new ride-hailing permits, while others warn of overcapacity, resulting in drivers receiving fewer than 10 orders a day.
James Cai, a driver from Haikou, one of the cities experiencing overcapacity issues, describes the situation as the consequence of the struggling economy. “Because the economy is not doing well, many workers have been laid off and began ride-hailing,” he says. “Most of them are 20-30 year olds.”
As the number of drivers continues to grow, existing drivers face a decline in earnings. Nanxun Li, a former driver from Haikou, was forced to sell his car and quit his job after his income dropped from 1,000 yuan a day to 300-400 yuan. He explains, “It’s getting difficult to make ends meet.”
Analyst Wang Ke predicts a “self-correction” in the market as some drivers abandon the profession due to the challenging circumstances. However, with China’s economy entering a period of slower growth, it is likely that making a living will remain a struggle for many.
In June, over 21% of Chinese youth were unemployed, indicating an alarming job market situation. The statistics bureau’s decision to stop publishing data on jobless youth further aggravates public concerns. As the job market shrinks, people like 45-year-old Shanghai driver Li Weimin find themselves with limited options.
“I don’t eat during the day, and I only have one meal after I get home at night,” Li shares. “But I must persist because there is no other job.”
The stories of drivers like Zhu Zhimin and Li Weimin expose the reality of China’s ride-hail industry. While it may seem convenient for passengers, the industry’s growth comes at the expense of those on the front lines, struggling to make a living and provide for their families. As China’s economy navigates slower growth, it is crucial to address the challenges faced by ride-hail drivers and find sustainable solutions to support their livelihoods.
Note: The image below depicts a ride-hail driver in China.
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