"Driving for ride-hailing services now feels like a wellness retreat," a driver in Dali, Yunnan province, lamented.

Each morning, after taking his children to school, he opens the app to look for passengers. If no well-priced rides appear, he messages his WeChat group, inviting colleagues to play mahjong. If enough people join, they rent a room; if more gather, they park their cars in a long line and watch. On slow days when they do not even feel like playing cards, some drivers simply share a car and drive around the city until their shift ends.

This sluggish operating condition is spreading among China's ride-hailing drivers. A few years ago, many drivers worked tirelessly to earn enough to buy their vehicles. Now, their income barely covers daily expenses. During off-peak hours, fares are so low they barely cover fuel costs. While prices increase during peak hours, traffic congestion and long queues of cars negate the benefits.

A driver at a charging station in Shenzhen, China. *Photo: Think China*

This market saturation stems from a massive influx into the industry post-pandemic, driven by rising unemployment and low entry barriers. Data from Chinese regulatory bodies, cited by the Wall Street Journal, indicates that from 2020 to 2024, the number of drivers increased by nearly 300%, while the number of rides only grew by about 60%. By 2024, China had 7,48 million licensed ride-hailing drivers, pushing average incomes to rock bottom.

This labor surplus creates a fierce competitive cycle, where individual effort increases but returns do not. In essence, everyone works harder, but no one improves their financial situation.

A 40-year-old driver from Sichuan exemplifies this struggle. Four years ago, the real estate market downturn led to this construction engineer losing his job, forcing him to become a driver. He works about 14 hours daily. His first shift runs from 16:00 to 02:00 the next morning, followed by a few hours of sleep and charging his vehicle in the suburbs to save costs. At 05:00, he wakes up for his second shift, working until 09:00. This grueling schedule exhausts him, yet after deducting vehicle rental and living expenses, he can only send about 3,000 yuan (approximately 10 million dong) home each month.

Similar pressures weigh on delivery drivers. To earn over 10,000 yuan (approximately 35 million dong) monthly, a Meituan food delivery driver in Shenzhen must travel more than 5,000 km, complete 1,000-2,000 orders, and work at least 13 hours daily. Many of his colleagues earn less than 4,000 yuan because per-order fees have sharply decreased, and platforms have also cut severe weather allowances. The explosion in vehicle numbers, combined with over 20% of current delivery drivers holding university degrees, further intensifies market competition.

Financial expert Andrew Sheng observes that the gig economy labor situation reflects a broader structural flaw in the economy. When too many people flock to one sector and compete primarily by lowering prices or extending working hours, overall productivity cannot increase.

He suggests that platforms need to shift from "squeezing cheap labor" to enhancing service quality and protecting workers' rights, preventing excessive social pressure.

Ngoc Ngan (Source: Think China)