Leslie Sherman-Shafer, a retired dental office assistant in the San Francisco Bay Area, starts each shift as an Uber driver with a growing sense of unease. Filling up her Toyota Corolla used to cost around $25. now, it’s closer to $40, a jump directly linked to rising gasoline prices fueled by global instability. “We don’t get reimbursed for gas,” Sherman-Shafer explains. “We rely on the generosity of the tip, and that’s getting harder to come by.” Her experience is increasingly common across the country, as millions of Americans whose jobs require them to be behind the wheel grapple with the financial strain of soaring fuel costs.
The impact extends far beyond ride-share drivers. Nearly 27% of civilian workers cited driving as a physical demand of their jobs in 2022, according to the U.S. Bureau of Labor Statistics. From delivery services and real estate agents to electricians and home health aides, a significant portion of the workforce relies on personal vehicles to earn a living. As the war in Ukraine continues to disrupt global oil supplies, these workers are facing a difficult choice: absorb the increased costs, pass them on to customers, or function longer hours to make ends meet.
Gas Prices and the Ripple Effect on Workers
The national average price for a gallon of regular gasoline reached $3.99 on Monday, April 15, 2024, a 34% increase from a month prior, according to AAA. AAA’s daily gas price tracker shows continued volatility, with regional variations adding to the challenge. This surge isn’t just a pain at the pump; it’s a direct hit to the income of those who depend on driving for their livelihood. For many, the increased cost of fuel effectively diminishes their hourly wage.
Some companies are attempting to mitigate the impact by offering mileage reimbursement. The Internal Revenue Service sets an annual standard mileage rate, currently at 67 cents per mile for 2024, which businesses can apply for tax deductions. Still, as Chris Willatt, owner of Alpine Maids in Denver, points out, even that isn’t keeping pace with the rapid increase in prices. “Our maids drive their own cars, so it’s kind of like their paycheck got smaller,” Willatt said. To help, Alpine Maids has reduced the frequency of office visits and optimized cleaning routes to minimize driving distances.
Businesses Adapt, But Challenges Remain
Other businesses are taking more direct action. Molly Kenefick, owner of Doggy Lama Pet Care Inc. In Oakland, California, recently increased her gas reimbursement rate to 80 cents per mile for her 15 employees. “The rate increase will stay in place until gas prices in our area drop below $5 for at least a month,” Kenefick explained. However, she’s hesitant to raise service prices too much, fearing a loss of customers. “The economy is hard for people. Everybody’s under strain,” she said, adding that she’s supplementing employee reimbursements from her own savings.
Ride-hailing and delivery platforms, which rely heavily on independent contractors, are offering limited incentives. DoorDash, Uber, Lyft, and Instacart are providing cash back on gas purchases for drivers using company-branded debit cards, and DoorDash and Instacart are offering weekly fuel payments to drivers who complete at least 125 miles of deliveries. But these measures aren’t always enough. Sarah Noell, a DoorDash driver in Lynchburg, Virginia, says she’s noticed a decline in customer tips as gas prices rise. “It takes nearly double the cost to fill my tank,” Noell said. “Ten dollars used to get me a decent amount. Now it only gets me 3 gallons.” She now refuses orders that don’t average at least $1 per mile, effectively turning down lower-paying jobs.
Global Impact and Diesel Fuel Costs
The squeeze isn’t limited to the United States. The rising cost of diesel fuel is impacting drivers worldwide. In the Philippines, drivers of diesel-powered “jeepneys” went on strike for two days in March to protest the increased costs. Similarly, in France, truck and bus drivers staged a slow-moving protest on the Paris ring road, demanding government assistance. Sarah Bahezre, manager of Ulysse Cars, a bus transportation company in France, explained the dilemma: “We’re not going to ask customers to pay that difference.”
Diesel prices have seen even steeper increases than gasoline. Average U.S. Diesel prices climbed 44% over the last month, according to AAA. Rachel Hunter, co-founder of Cactus Crew Junk Removal & Thrift Store in Phoenix, Arizona, has seen the cost to fill her company’s diesel truck jump from $3.62 to $6.09 per gallon. “The truck carries all kinds of heavy cargo…so fuel costs quickly add up,” Hunter said, adding that she’s now factoring the higher fuel costs into her quotes, but worries about remaining competitive.
Looking Ahead
The situation remains fluid, heavily dependent on geopolitical developments and global oil production. The Energy Information Administration (EIA) is scheduled to release its Short-Term Energy Outlook on May 14, 2024, which will provide updated forecasts for gasoline and diesel prices. The EIA’s website offers a wealth of data and analysis on energy markets. For workers who rely on driving, the coming weeks will likely be a continued test of financial resilience. The long-term solution will require a combination of factors, including increased fuel efficiency, alternative transportation options, and potentially, government intervention to stabilize energy markets.
What are your thoughts on how rising gas prices are impacting your work or community? Share your experiences and ideas in the comments below.
