- Delivering groceries and takeout as a gig worker was a lucrative job early in the pandemic.
- But in 2023, the job got more competitive and paid less, workers said in dozens of interviews.
- Many gig workers are deciding that a traditional 9-to-5 job makes more sense.
In 2020, at the height of the pandemic, Juan started delivering groceries through Instacart and takeout orders via Uber Eats in Southern California. The money was good enough that he didn't need any other job.
Three years later, Juan is still a full-time gig delivery worker. But he's running out of options to stay that way.
These days, Juan said, he gets fewer offers through the apps. Those that do pop up on his screen are gone in a second or two if he's not quick, a change he attributes to more people in his area getting into delivery work. He's also tried to sign up for other apps, including Amazon Flex, Grubhub, and DoorDash, but hasn't gotten off waitlists for them. "Right now, they're not taking more drivers," he said.
"2020 and 2021 were excellent, but things started to go downhill in 2022 and now 2023," Juan told Business Insider.
Spokespeople for Amazon, DoorDash, and Grubhub confirmed to Business Insider that they put prospective delivery workers on waitlists in certain markets based on demand for deliveries.
Over the last several months, I've spoken with roughly three dozen people who work for Instacart, DoorDash, Walmart's Spark, and other delivery services that rely on gig workers.
Most of those conversations included a common theme: Working as a delivery driver got a lot harder over the past year. Lots of workers tell me that they got into delivering early in the pandemic when lots of people were willing to pay extra to have groceries, takeout, and other things brought to their door.
But now, things are harder. Just finding orders to deliver can be a challenge. Some services, like Instacart, have also cut base pay for delivering orders. Less than 10% of gig workers make over $2,000 a month, according to research from PayQuicker, a payments company with clients in the gig-work space.
Here are some of the problems that delivery gig workers faced in 2023, varying from lower pay to greater competition to sudden deactivations. Several workers declined to have their names used, citing potential retaliation from the apps. Business Insider has verified their identities and status as gig workers.
More competition, lower pay, and a rigid schedule
Many of the delivery services have pitched themselves for years to workers who don't want a rigid 9-to-5 schedule.
A 2015 worker testimonial from Instacart is a great example. Titled "How Instacart shoppers are achieving big dreams on a flexible schedule," it features "Greg F.," an aspiring actor who made ends meet delivering orders for Instacart. "My availability changes every week in terms of rehearsals and auditions," a quote from Greg in the testimonial reads. "And I can accommodate that."
But working for the apps has started to look more like an office job, especially when it comes to working at a specific time, workers told Business Insider.
Instacart encourages shoppers to hang out in parking lots near busy areas identified using color-coded heatmaps, Business Insider reported earlier this year. The company says that being near a busy store improves shoppers' chances of stanching orders.
That's a contrast with past years when many shoppers could claim an order from home, even if they were miles away from a store. "Now, you're not really free anymore," one shopper in Utah told Business Insider. "You're locked in."
Earlier this year, Instacart told Business Insider that a majority of its contractors spend less than 10 hours each week doing work for the app. "Overwhelmingly, shoppers say they choose to earn income through the Instacart platform because of the freedom and independence they get with a flexible schedule," an Instacart spokesperson said.
One driver for DoorDash in California said he doesn't mind waiting in parking lots. But he says doing other things on his phone to pass the time, like watching YouTube videos, has made him miss out on decent orders. "It's like being clocked in," he said. "You can't be on your phone."
Contractors for Walmart's Spark delivery service also have to show up in store parking lots once an hour in order to claim orders. Once they pull into a spot, they open the Spark app by the appointed time, which varies by store, and then claim an order or batch of orders they want to deliver. A Walmart associate is then supposed to whisk the order out of the store and into their car. In practice, though, stores are so overwhelmed that they face delays of an hour or more filling Spark orders, as Business Insider reported in October.
Most Spark orders are filled on this hourly drop schedule, one worker in Texas said. "I can literally pull up at, let's say, 12:39, and I am one minute too late," the driver said. "I do not get anything."
A Walmart spokesperson told Insider in October that orders make it out to drivers in 10 minutes or less. "We are focused on giving drivers an efficient pick-up experience and maximizing their earning opportunities, so we consider the time it takes to dispense orders when determining earnings for each trip," the spokesperson said.
Then, there's competing with all the other gig workers. Instacart's gig workforce has swelled to 600,000, and Walmart estimates that "hundreds of thousands" of people have made deliveries for Spark. Yet demand for the delivery of many items, especially groceries, has tapered off since the early pandemic.
That translates to lower earnings for many workers. "People cannot live off of $30, so they have to find something else," the Spark driver in Texas said.
Delivery app workers have realized that pay isn't reliable
For lots of gig workers, delivering groceries, takeout, and other stuff just isn't paying the bills like it used to.
Alexia Hudson spent two years delivering orders for Instacart in the area around Charlotte, North Carolina.
Then, in July, two months before its IPO, Instacart cut its minimum payment per group of orders from $7 to $4. Hudson told Business Insider at the time that the pay cut meant the job didn't make sense for her anymore.
Since then, she has started a full-time job and has stopped delivering for Instacart.
"With these updates, we expect average pay to stay the same for shoppers across the platform," Daniel Danker, chief product officer at Instacart, said at the time of the pay cut. "We know that not all orders are created equal, and we want to make sure shopper earnings reflect the effort needed to fulfill each batch."
Others have followed Hudson in throwing in the towel on gig work. Demand for delivery services has fallen since early in the pandemic, a report from the Bank of America Institute published in April found. At the same time, wages for most full-time jobs have risen, leading many who relied on gig work for their income to apply for 9-to-5 work, according to the report.
An old-fashioned job might also come with more security than working for gig apps. Some independent contractors have learned the hard way that you can be booted from an app for an honest mistake at the Walmart self-checkout.
Many gig workers told Business Insider in October that once deactivated, they have little, if any, opportunity to appeal the decision and get reinstated. The companies, including Instacart, Grubhub, DoorDash, and Uber, said that they have appeals processes and that drivers who haven't done anything wrong can be reactivated.
New laws in some big cities aim to improve conditions for gig workers. In Seattle, for instance, laws mandating that some gig workers get sick days and a minimum hourly wage of $17.27 will take effect in January. Another city ordinance, which requires gig apps to provide 14 days of notice to workers they intend to deactivate, takes effect in 2025, GeekWire reported in August.
Last month, a state appeals court judge upheld a New York City law that would require DoorDash, Grubhub, and Uber to pay food delivery workers at least $17.96 an hour – the city's minimum wage, according to the New York Post.
The companies that employ delivery workers oppose the laws. Target-owned delivery service Shipt has even said that it will suspend operations in Seattle next month, days before that city's new laws take effect.
For most workers, like Juan in Southern California, getting out of the gig economy entirely seems like a better option. "Obviously, the slice of the pie is getting smaller and smaller for me," he said. "I'm looking for a proper job right now."
Do you work for Instacart, Walmart Spark, or another gig delivery service and have a story idea to share? Reach out to this reporter at [email protected]