A Fare Raise: Will increasing the fare affect cabbies?

For decades, bright yellow taxi cabs have been an unmistakable mark of New York City. The taxis and other vehicles that make up the city’s public transit system truly keep the city running. As taxis can be seen nearly everywhere in the Big Apple and are always being hailed, it would seem as if cabbies would make a salary high enough to make ends meet. Since the average New York City area taxi cab driver’s yearly income was $49,532 in 2008 according to 411newyork.com, making ends meet is difficult for them, especially if they have a family.

For the first time in eight years, a raise for taxi drivers was proposed and subsequently passed on Thursday, July 12. About a 17% fare increase will be applied across the board, and garages will not be able to raise their taxi rental prices. However, the potential does exist for the demand for taxis to reduce with the increase in price, as no reasonable consumer ever wants to be paying more for really anything. Will a decrease in clientele counterbalance any positive effects from the raise in taxi fare for the cabbies?

The impractical status quo is the reason behind the raise in fares. Since 2006, there has been an entry fee of $2.50 into a cab and $0.40 added to the fare after one fifth of a mile (as long as drivers are moving faster than a pace of 6 miles per hour) and every sixty seconds when a taxi is not in motion. The fees seem as if they should provide a driver with a substantial income after a twelve hour shift, possibly from $150 – $300. The problem, however, lies in the fact that cabbies have to lease their cabs daily for a cost around $110 and pay for their gasoline, which could cost around $40, to name just a coupole of the expenses that they face. At the end of the day, they simply are not able to make enough money to live comfortably. In fact, on a slow day, some drivers have even reported that they had lost money.

Luckily for taxi drivers, raises in fares (similarly to the 26% metered fare increase in 2004) have historically led to small declines in demand from their clients. The complete raise in fares will overshadow the effects of losing the money of the few customers who opt to stop riding in taxis because of the price.

New York taxi drivers themselves will gain large benefits from the policy, since rental prices are only being slightly raised. Although they will still have to pay their usual fees, higher daily earnings will easily result in more money being brought back to their own families or to live a more comfortable life. Their raise will help keep the taxi industry thriving because drivers will know that they can continue in their line of work and make a higher income to more easily cover the basic costs of living. Furthermore, the Taxi industry is a rarity in terms of eight years without an increase in fares. According to the New York Times, costs of taking the subway and city busses has increased significantly within the last eight years while Taxi have not gotten a raise. For the sake of the taxi drivers, the fares need to rise like all others in the public transportation sector to keep up with the rising cost of living.

Cabbies have finally been given a reward for their continuous work over the past few years. Now that their pay will be adjusted to finally catch up with inflation, they can live a higher quality life, and will be positively affected by this new policy.

By Sara Evall

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