Lyft said it expects some drivers to shift from food-delivery apps to ride-hailing ones after the pandemic

A delivery driver hands a customer a take-out order.

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• Lyft said some drivers will likely move from food-delivery to ride-hailing apps as the US reopens.
• Cofounder John Zimmer said ride-hail work generally has better pay and more social interaction.
• The shift could help solve Lyft's driver shortage as ride-hail demand continues to grow.
• See more stories on Insider's business page.

The reopening of the economy could lead to a shift in labor from delivering takeout to transporting passengers, according to Lyft.

Executives at the ride-hailing app said during its first-quarter earnings call Tuesday that this could help solve its driver shortage, which it said has led to higher fares for customers and "record earnings" for drivers.

"We believe that individuals who have been doing other forms of app-based work over the last years will transition to rideshare," Lyft cofounder John Zimmer said, before picking food-delivery apps as an example.

Read more: More than half of Uber and Lyft drivers stopped driving during the pandemic, and that number is far from recovered, new data shows

He said ride-share work generally brings in higher earnings than food delivery, though he noted that it was difficult to compare.

Drivers also want the opportunity to talk to people in person, Zimmer said.

"Rideshare also offers a fundamentally different experience with social interactions that are largely absent from food delivery," Zimmer added. "After a year of social distancing, drivers are telling us they crave these in-person conversations."

Food-delivery work could also be harder to come by if people start ordering less takeout as the economy reopens. California is lifting COVID-19 restrictions on restaurants on June 15, while New York state is ending its midnight curfew on restaurants later this month.

Demand for ride-sharing services is growing after plummeting in 2020. Wedbush analyst Dan Ives said he expects Lyft to see a "roaring 20s-like" rebound into the second half of 2021 as both business and leisure travel rise.

But Lyft rival Uber said during its earnings call Wednesday that it's still making significantly from revenues from its food-delivery service than its ride-hailing service. Its first-quarter revenues from its delivery services were three times higher than the same period last year.

"Nobody knows exactly what the delivery market will look like," Lyft CEO Logan Green said Tuesday. "But if delivery does slow down as the economy reopens, then we would expect to see a number of delivery drivers move back to ridesharing."

Hiring in the US private sector accelerated through April, aided by the vaccine rollout, but some industries have still been hit by huge labor shortages. Insider's Ayelet Sheffey reported that this could be caused by a mix of unemployment benefits, COVID-19 health concerns, caring responsibilities, and low wages, but Bank of America expects this worker shortage to fade by early 2022.

Restaurant chains like Subway and Dunkin' have cut hours and closed dining rooms to cope with the lack of available workers, and are offering lucrative benefits including cash bonuses, raises, and education benefits to attract new hires.

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