Seattle Democrats destroyed app-based food delivery services and dashed the financial future of its workers, but they don’t seem to mind.
The far-left Seattle City Council, and their union-backed activist friends, did what they always do. They saw a market working imperfectly, declared it unjust, and decided they were smart enough to redesign it from City Hall. Two years later, Uber Eats, DoorDash, and Grubhub are shells of what they were, restaurants are bleeding orders, and the drivers who were supposedly rescued are worse off.
This is the story of the so-called PayUp law. It was sold as compassion, like every left-wing cause, but delivered collapse.
Higher pay at first, then fewer orders and idle time
In 2024, Seattle imposed a minimum earnings standard for app-based food delivery drivers that functioned as a $26.40 per hour mandate once time and mileage were factored in. The intent was to boost wages and provide more protections. The reality was sticker shock for customers, far fewer orders, and a market that no longer works.
KUOW recently revisited the policy and the results are damning.
When the ordinance first took effect, some drivers saw dramatic pay increases. Ruby de Luna reported on KUOW that Michael Lowe, a retired driver supplementing his income, had a striking early experience.
“I delivered one order on a Friday night, that was two deliveries from Queen Anne to Wedgewood, and the traffic was so bad… if you get stuck in traffic, you get paid well,” Michael Lowe told KUOW.
Those deliveries took close to an hour. He was paid $58. Lowe estimated that before the law, he would have made about $17.
The law required companies to pay for mileage and time spent waiting, including sitting in traffic. It also added deactivation protections. On paper, it sounded like a win. But the bump did not last.
Reality set in
Orders started coming to a stop. One worker told KUOW she can be logged on for hours without receiving a single order. Drivers now face more unpaid idle time and longer distances between orders.
This is basic economics. Raise the price of something high enough and demand falls. The ripple effects hit restaurants almost immediately.
“A meal might be $12 or $15 in our restaurant,” restauranteur Uttam Mukherjee told KUOW. “By the time a customer gets it through these apps, it becomes $35, $40 so I wouldn’t buy our own food for that price. Why should we expect customers to do that?”
Mukherjee estimates his business declined by 50 percent.
I looked up prices on DoorDash on Sunday night because I wanted Kau Kau Barbeque, but didn’t want to drive to Chinatown. The BBQ combination plus white rice and hot mustard came out to a modest $23.40. But then came the $2.99 delivery fee, $3.51 service fee, and $4.99 Seattle Regulatory Response Fee, before $3.37 tax and tip. I deleted the order and ate something in the fridge.
This was all predictable
DoorDash’s own report shows Seattle is now the most expensive delivery market in the country and has seen the steepest decline in delivery orders. Meanwhile, cities like Denver and Portland, which do not have Seattle’s law, saw monthly average sales increase up to 30 percent. Seattle saw about 5 percent.
The same company, the same product, the same time period. The only difference was policy.
Progressive strategist Sandeep Kaushik, who consulted for DoorDash, says this was avoidable.
“Having worked directly on this consulting for DoorDash, I can say that the tragedy here is that there was a sweet spot, where if the earnings standard had been set correctly, driver compensation in Seattle would have risen about 20 percent. Instead it fell,” Sandeep Kaushik wrote on X.
“We warned them that they were setting the pay standard too high, and that to compensate the companies would have to add on significant new fees that would likely have a demand side negative impact which would run counter to the boost created by the higher earnings standard,” Kaushik added.
He explained the structural problem in plain terms.
“The economics of delivery works at an increment somewhat above the Seattle minimum wage for net compensation after expenses and before tips. But it doesn’t work at the premium they set it at roughly 150 percent of the minimum wage net compensation before tips,” Kaushik wrote.
This could have been avoided
“So the demand side sticker shock was really big when the standard went into effect, creating a surplus of labor too many drivers chasing too few orders which still persists and which has led to net compensation for drivers falling as wait times between orders surged,” Kaushik wrote.
Seattle now has what Kaushik describes as a lose-lose-lose outcome. Drivers earn less than before. Restaurants see fewer orders. Companies lose money. The only thing that increased was political self-satisfaction.
There is still time to fix it. But that would require the activists and councilmembers who imposed the standard to admit they broke the market. The truth is the one thing they will never deliver.
Follow @https://twitter.com/jasonrantz
