Increased gas prices have affected everyone across the world since the start of the Covid-19 pandemic. In Arizona alone the average price of a gallon of gas is $3.32. Gas prices cause more pain than just paying a couple extra dollars when stopping at the gas station. Gig workers such as Uber, Lyft, and any other driver that is making an income by using their vehicle are being economically hurt by these inflated prices.

Uber/Lyft drivers need to charge higher prices for rides just to offset these increased costs in gas prices. An issue with this is that the individuals do not set the rate. These drivers work on an app that sets the rates for rides for them. This means these drivers rely on a large company to understand the individual needs of different drivers and a lot of the time they don’t. These gig workers rely heavily on tips that customers give them. Another issue with this is the economic crisis caused by increased gas prices is consumers of services like Uber/Lyft are also stretching their salary, therefore customers may not tip as much as usual.

Looking at an even larger picture, increased gas prices are adding to the issues that are plaguing the economy. The economy is struggling due to lack of labor and increased costs of living (including gas prices). People around the world are struggling with rising prices that are causing them to have to stretch their wages thin.

Companies large and small across the globe are suffering from employees having to pay for gas. Employees already have the upper hand in the current economic state, labor shortages have been an issue since the pandemic began. Companies are being forced to offer benefits, like fuel compensation, to employees just to keep them from leaving for another company.

A large factor that affects whether an employee will stay with a company or leave for a better opportunity is salary/pay. The lack of labor is causing companies to be forced to increase their pay to their employees, this causes employers and companies margins to drop due to their rising costs. Employers and businesses are being hurt by this increased cost of living for their employees because their employees now require a higher income to fuel their normal lifestyle.

How does this increase in employee wages affect the company? The companies must find a way to stay in business. When workers’ expenses go up and they need a higher income, businesses costs (such as employee wages) increase so they need their revenue to increase. The easiest way for a company to raise their revenue is to increase their prices. Increasing prices is risky because the business may suffer, lose customers, or go out of business. This rise in prices lead to more issues circling back to consumers needing to spend more on their purchases or services.

For gig work to continue to thrive like it has been, the gas prices and inflated prices in the economy need to come down.


Wayne Goshkarian is the Director of Communications for Scottsdale-based Association for Entrepreneurship USA where he assists entrepreneurs nationwide with creating, establishing and expanding their businesses.