Seattle's $5 Minimum Pay Rule for Gig Drivers Fails to Boost Monthly Earnings

Seattle enacted a law in January 2024 mandating delivery apps to pay drivers at least $5 per delivery. The law increased per-delivery pay but did not raise total monthly earnings because higher wages drove up costs, causing fewer delivery opportunities and reduced tips amid intensified driver competition. Moving forward, policymakers must consider market dynamics and competitive effects when designing regulations to improve gig worker incomes.