Uber: a route out of the French banlieues

Baba, or “Sanka” as he is known to his friends in Bobigny, a suburb in northern Paris, likes to say that Uber got him out of jail — and kept him out.

A high-school dropout, Baba started to slip into petty crime in his teenage years, much like many youngsters in the unemployment-stricken immigrant enclaves that encircle France’s capital. At 17, he was sentenced to four months in prison for a robbery. The conviction was erased from his record because he was under 18 but in 2012 he was in jail again.

By then, Uber had rolled out its ride-hailing app in France. A friend who had started a minicab company using Uber’s technology offered Baba a job as a driver and a judge let him out early under judicial review. Since then, Baba has been working 10 to 12 hours nightly, six days a week. In 2014, he gained a licence to operate his own chauffeur service.

“Without this job, maybe I would be in prison,” Baba says, laughing as he drove his Peugeot 508 to a garage through rundown rows of small houses.

Now, the 24-year-old wants to set up a transport company with his older sister and take on people to work for him. He is a role model for his friend Amara Koita, also an Uber driver, who says he avoided prison only because his mother sent him to Senegal to study religion for three years after he skipped school.

Pointing to an empty square surrounded by a kebab shop, a supermarket and blocks of flats, Baba reflects on how the job has changed his life. “Before Uber, we would all stand there, talking crap all day,” he says. “Now I own a beautiful car, I’ve bought a Zara suit. I love this job, I love driving through Paris, talking to clients. It’s good money if you work hard. I am not letting go of this job.”

Uber, though, has not been embraced by everyone. When the company opened its services in Paris and other European cities, it was resisted by taxi companies. The reaction was fiercest in France, with angry protests and even attacks on Uber drivers. Two Uber executives were detained by police and are being tried in Paris on “complicity in the illegal exercise of the taxi profession”.

In French suburbs such as Bobigny, however, the rise of Uber and other French minicab services represents something else: a foothold in the job market for thousands of undereducated youngsters of immigrant descent.

Suburban burden

The banlieues, as the deprived suburbs are called, have been a thorn in France’s side for four decades. They were the scene of riots in 2005 after the accidental death of two teenagers chased by police in Clichy-sous-Bois, 10km from Bobigny. Governments have poured in investment worth €40bn for renovation, but unemployment is still higher than average and the estates are plagued by crime and discrimination, as well as the more recent threat of Islamist radicalisation.

In Bobigny, joblessness stands at 22 per cent, double the national rate. More than a third of those aged 15 to 29 are unemployed.

It took only a few years for Uber and other platforms challenging the Parisian taxis’ monopoly to create more than 15,000 jobs. (About 5,300 are self-employed and the rest are employed by minicab companies.) They compete against the 17,000 taxis in Paris.

“There has been a tidal wave of start-ups in the banlieues, an entire generation wants to be Uber drivers,” says Sabrina Lauro at Planet Adam, a non-profit organisation that helps residents in the suburbs set up businesses. Uber appeals to those without a diploma or work experience, she said.

Research seems to bear this out. Charles Boissel, a PhD student at HEC Paris, a business school, found that most minicab registrations were in the “suburbs of northern and south-eastern Paris, where economic conditions are harshest”.

After Uber agreed to partly open its database, Augustin Landier, professor at the Toulouse School of Economics, and David Thesmar, a professor at HEC, conducted the first detailed survey of Uber drivers in France. According to their findings, provided to the Financial Times, an overwhelming number of drivers are male (98 per cent); they are much younger than established taxi drivers (70 per cent are under 40, compared with 30 per cent for taxis), and more have experienced unemployment (a quarter were jobless before turning to Uber, and nearly half of those for more than a year).

Unlike US drivers, who tend to use Uber to add to their income, 81 per cent of French drivers have no other job. Two-thirds say they want “to start a new long-term career”. A fifth work more than 40 hours a week. Most earn €20 an hour, more than twice the minimum wage.

Mr Koita, Baba’s friend, says he could pocket €1,700 a month after the 20 per cent Uber charge, fuel and other costs. This is as much as he made working as the manager of his uncle’s supermarket, which was burnt down by an arsonist.

“Uber is a social game-changer,” says Prof Thesmar. “Starting a company is usually the best way for immigrants to integrate. That’s what Uber shows: if you make it easier for those youngsters to set up companies, it’s more efficient than any urban policy or state subsidies.”

Driving change

A bipartisan commission set up in 2007 by Nicolas Sarkozy, the centre-right former president, estimated that opening up the taxi market could yield 35,000 to 45,000 additional driver jobs in the Paris region alone.

The new competition has boosted demand. According to the National Institute for Statistics and Economic Studies, the revenues of the sector — taxis and minicabs — increased by 10 per cent between 2010 and 2015.

That should be good news for François Hollande, the Socialist president who has vowed to curb record unemployment before next year or else abandon plans to seek re-election. The trend also supports the push by Emmanuel Macron, the economy minister, to pull down barriers of overly protected sectors as a remedy to France’s two-tier job market.

“For many young people it’s easier to find a client than a job,” Mr Macron said.

Yet, under pressure from lobbying by the taxis — whose largest company, G7, has long-established links with the Socialist party — there are plans to restrict the use of Uber and other ride-hailing platforms.

If adopted, it would mean that people with criminal records, like Baba, would be unable to obtain a licence. A proposal to ban drivers operating under a collective transport licence from using the platforms threatens at least 7,000 jobs: the government insists the status, used by most drivers because it is cheaper and quicker to obtain than a minicab licence, can only apply when carrying between two and nine people, not just one.

“Uber’s success in the banlieues is a spontaneous response to decades of public policies that have failed to combat discrimination and boost job creation,” says Thomas Kirszbaum, a sociologist at École Normale Supérieure de Cachan. “And now, once again, we’re pondering measures that could have a disproportionate effect on an already vulnerable population.” In countries where ethnic statistics are collected — France does not — such measures could be seen as discriminatory, he says.

Mr Landier and Mr Thesmar estimated that if Uber drivers were to lose their jobs, more than 20 per cent of them would still be unemployed two years later.

For Fouad Baadache, a 23-year-old entrepreneur born to Algerian parents, the latest clampdown could damage his business. His 30 drivers, all employed under permanent contracts, could lose their jobs because they use the collective transport status. One of them, who at 31 had never had a proper job, came to him in tears, he says.

“The state has never done anything for us and against all odds we create actual jobs,” says Mr Baadache, who lives in Asnières-sur-Seine, northern Paris.

“Now they want to prevent us from succeeding, they want to send us back to the banlieues. The government doesn’t realise the situation is explosive. It could be worse than in 2005.”

Regulation

The government insists it is seeking to prevent the excesses of a rapidly expanding industry. “New forms of exploitation have emerged,” Ms Lauro of Planet Adam says. “Some drivers without a car and a licence can operate, but they sometimes have to work nonstop to barely cover their costs.”

The regulatory scrutiny is not unique to France. In Germany, Italy and Spain, courts have ordered bans on Uber’s low-cost service. Uber drivers have been arrested in Brussels and Amsterdam, while curbs have been discussed in the UK. Unions have complained about the company’s policies towards workers.

In Bobigny, Ismael Rakhmi, who goes with Baba to attend prayers at the mosque, recalled that he had to work for 13 hours a day for six days to earn €1,900 a month — a lower hourly wage than his previous six-month temporary job loading trucks at TNT. Because he had no licence and no car, he retained less than a third of each fare.

“At TNT, I had two days of rest a week,” he said. Mr Rakhmi has applied for a minicab licence but has to wait longer now because of the clampdown.

Uber’s decision to slash fares by 20 per cent in October was also painful, drivers say. It hurt more than the repercussions of the Paris terror attacks that killed 130 people in November, which led to Parisians staying at home.

The benefits of Uber cabs go beyond economics, the drivers say: they improve social cohesion at a time when France, divided over its Muslim population, needs it badly.

“It’s two worlds meeting at last,” says Joseph Francois, who heads one of the largest minicab companies with 140 drivers. “You’ve got young people from the suburbs transporting Parisian lawyers from Neuilly, artists, people coming from China or Australia. All of a sudden, social barriers and prejudices vanish. They talk. They have a better understanding of each other.”

Some of his drivers have the highest Uber grades yet do not fit the stereotype of the perfect employee: one is heavily tattooed and another has dreadlocks.

“People from the banlieues feel stigmatised, most have difficulties speaking proper French, but all of a sudden they are wearing a suit, driving a nice car. They feel appreciated,” Mr Baadache says.

Baba, though, worries about the effect of the new regulations. “If 10,000 drivers are gone, we won’t be able to meet the demand. Prices could go up, wait times could be longer.”

As for the drivers who would be left without a job, Baba shrugs. “Most of them will go back to the banlieues, many of them will go back to crime.”

Additional reporting by Murad Ahmed