Blue City’s Plan To Pay DoorDashers More Runs Into Basic Law Of Economics

A Seattle City ordinance helped to increase the wages of app-based gig workers for the first few months it went into effect but now the workers are faced with a staggering halt to their earnings.

The ordinance, which went into effect 2024, increased gig worker’s minimum wage payment and compensation for time spent in traffic and distance traveled. Workers saw a rise in pay for the first few months but they soon saw a steep decline in their wages when customers were faced with increased fees, according to KUOW NPR.

Michael Lowe, a worker for DoorDash, got paid $58 for two deliveries that took an hour to complete due to traffic and said he would have been paid $17 for those same orders before the ordinance, the outlet reported. Lowe said the orders coming from customers began to slow down after a few months, leading to some workers being logged on for hours without seeing a single order come through.

Uttam Mukherjee, a co-owner to an Indian restaurant in Seattle, estimated his business declined nearly 50% as a result of the ordinance causing new fees to be added to delivery orders, according to KUOW NPR. Mukherjee said the new fees would make a $12-15 meal from his restaurant increase to $35-40 when ordering through an app like DoorDash.

DoorDash published a report tracking order sales from January 2023 to January 2025 across Denver, Portland, Seattle, and San Francisco. The report claimed monthly order sales per stores increased 20% in Denver, 40% in Portland, and 30% San Francisco but only 5% in Seattle.

The DoorDash report said Seattle customers paid 3.5 times the average order fee than customers across Denver, San Francisco and Portland.

The Intentionalist, a Seattle based guide to small businesses, conducted a survey late 2025 that showed a wide range of local businesses struggled financially more than they did during the COVID-19 pandemic. Nearly 71.4% of surveyed businesses said foot traffic is down from the previous year, 63% reported a decline in business, and around 80% operate under $1 million in annual revenue according to the survey.