Recent data shows a significant increase in the number of online ride-hailing drivers in China, while the average daily order volume has plummeted drastically. This trend reflects the ongoing downturn in the Chinese economy and the high unemployment rates, forcing more middle-class individuals to turn to jobs like food delivery or driving for ride-hailing services to make ends meet.
According to a report released by Geely Illustrated World on August 12th, in October 2024, the number of online ride-hailing drivers in China surged by 158.8% from the end of 2020 to reach 7.483 million. However, during the same period, the daily average order volume dropped from 23.3 orders to just 10 orders.
This news has sparked discussions among Chinese netizens, with many expressing concerns over the steep decline in daily order volume. Some pointed out that this situation highlights underlying issues that cannot be ignored, such as the increasing number of former middle-class individuals turning to flexible employment opportunities like ride-hailing and food delivery.
A netizen commented, “The sharp 57% drop in daily orders is very telling. Many of these drivers were previously business owners or held white-collar jobs. This shift to more flexible employment seems to be a common trend among the middle class.”
Last year, a Beijing observer known as Mr. Chai (pseudonym) highlighted the lack of social security benefits for food delivery workers and ride-hailing drivers. He described them as “new forms of employment under complex platform-based labor models.”
Mr. Chai conducted interviews with 50 online ride-hailing drivers in Beijing and discovered that many of them had diverse backgrounds, including former bankrupt small business owners, unemployed white-collar workers, and individuals with higher education degrees.
The influx of labor into the online ride-hailing and food delivery industries can be attributed to several factors, as observed by Mr. Chai:
1. These jobs require minimal skills and offer higher income compared to factory or restaurant jobs.
2. Workers have more control over their working hours and income, providing a sense of autonomy.
3. These jobs offer quick rewards, with the ability to cash out earnings in as little as three days, which is crucial for individuals facing financial hardship.
4. Economic downturn and industry decline have made it difficult for individuals to find better employment opportunities, leading many to turn to online ride-hailing and food delivery as alternative sources of income.
The shifting employment landscape in China underscores the challenges faced by the middle class in a tough economic environment, where traditional job opportunities are diminishing, and individuals are compelled to seek alternative means of livelihood.