Taxi Drivers Get Raw Deal, Report Says

A new city of Portland report calls for additional regulations on the local taxi business, citing drivers' long hours and low pay.

The following table, drawn from the report (pdf) shows what local drivers make:

2011 City of Portland Fair Wage $9.61

Oregon Minimum Wage $8.50

Average Hourly Wage of Portland Taxi Drivers $6.22

The estimates are corrected for what the city assumes to be a 15 percent income underreporting rate, given the cash-intensive nature of the business

The report says many drivers worked 12-14 hour shifts, six to seven days a week to make ends meet.

Although Portland drivers' pay was "consistent with those found in recent studies in other U.S. cities," the report says, it still finds cause for regulatory action:

Long hours, inadequate rest and health benefits, and the pressure for drivers to make large weekly payments to companies have negative impacts on customer safety and service, and may push the costs of medical and other services onto the community.

The report gives little indication what new regulations the city might have in mind, but it does indicate that the current city permitting system stacks the market against drivers, who usually work as independent contractors, and in favor of the taxi companies that hire them.

There are no caps on the number of taxi drivers who may be permitted, thus creating a steady and unlimited pool of potential drivers, particularly in times of high unemployment.

In contrast, the City permitting system limits the number of taxi vehicle permits and has reissued permits to the same companies for many years, with relatively few performance requirements.

The oversupply of drivers relative to the limited number of tightly-held taxi permits creates artificially poor market conditions for drivers, with too few incentives for companies to provide adequate services at reasonable costs to drivers.

The Revenue Bureau is soliciting public comments before making recommendations to the city council.