How Much Do DoorDash Drivers Actually Make in a Year?

When it comes to understanding the earnings of DoorDash drivers, many are left wondering how much they can truly make. This question often stems from a combination of factors, including the distance they drive, the number of deliveries they complete, and the costs associated with maintaining their vehicles. In this article, we break down the numbers to provide a clear picture of the potential earnings for DoorDash drivers.

Understanding the Base Pay and Mileage Rates

DoorDash offers a competitive payout structure for its drivers. For every mile driven, drivers receive $1.04, while the IRS mileage reimbursement rate as of 2020 was $0.575 per mile. This means that for every mile driven, drivers are making a net profit of $0.465.

Using this information, we can calculate the potential earnings for a standard delivery. If a driver completes a 4-mile delivery, they would receive $1.86, which includes base pay and the net profit from mileage reimbursement.

Detailed Calculation for Annual Earnings

Let's consider a scenario where a DoorDash driver works an 8-hour shift a day, delivering two orders per hour. This would equate to a base pay of $2.00 per delivery, plus the net profit from mileage reimbursement of $1.86. Therefore, the total earnings per delivery would be $3.86, and with two deliveries per hour, the driver would earn $7.72 per hour.

Annual Earnings and Costs

If we assume that a driver works an 8-hour shift for 260 days in a year (approximately 52 weeks, minus public holidays), they would work 2,080 hours in a year. At an effective rate of $7.72 per hour, the total earnings for the year would be:

$7.72 * 2080 $16,145.60

However, it's important to consider the additional costs associated with the vehicle. The driver is responsible for paying for gas, maintenance, insurance, repairs, and tires. For the sake of simplicity, let's assume the driver puts 16,640 miles on their vehicle in a year, which, based on the IRS mileage rate, would cost an estimated $9,568.

Net Earnings Calculation

After accounting for the vehicle costs, the actual net earnings for the driver would be:

$16,145.60 - $9,568 $6,577.60

This calculation demonstrates that, despite the seemingly high earnings per delivery, the overall financial situation for a full-time DoorDash driver is far from lucrative. In fact, it amounts to little more than a minimum wage job that barely covers expenses.

Long-Term Financial Implications

Questioning whether one's income can sustain them long-term, the answer is often no. For most gig economy jobs, including DoorDash, the earnings are designed to help cover basic expenses while working on other, more stable job opportunities. The income from DoorDash is not intended to be a living wage but rather a supplement to other sources of income.

Conclusion

In conclusion, the earnings of DoorDash drivers, while potentially higher than minimum wage, must be carefully analyzed to understand the true financial implications. Drivers need to be aware of the various costs associated with their work and plan accordingly. For those considering gig work as a full-time or primary source of income, it is important to recognize that it is not designed to provide financial stability. Instead, it serves as a flexible and supplementary income source for those balancing multiple job opportunities or seeking short-term employment.

Keywords: DoorDash driver earnings, delivery app revenue, gig economy pay