Is there a shortage of taxi drivers?

Customers looking to catch a cab over the past 12 months have been reporting significant difficulties as taxi driver numbers appear to have fallen across the country. Taxi Insurer takes a look at the figures and finds out what’s behind this worrying situation.


Staying profitable is a key part of any taxi business success. But if you don’t have the right taxi insurance then all your hard work could be for nothing.


Contact the experienced team of insurance professionals at Taxi Insurer today and find out if your taxi cab insurance policy is still fit for purpose. Speaking to a company you can trust is the best way to stay on top of business matters and hold on to more of your hard-earned cash.


Is there a shortage of taxi drivers?


According to a recent survey of regular taxi and private hire vehicle (PHV) users, since December 2021 almost 70% have struggled or completely failed to book a taxi, 72% have missed or were late for an important event due to lack of availability, and 72% have had to walk home alone after a night out because they couldn’t get a cab.


But while there is plenty of anecdotal evidence for a drop in driver numbers, what do the official headline figures from the Department for Transport show? Well, they show that in fact between 2021 and 2022, the total number of licensed vehicles increased slightly, while the number of licensed drivers has continued to fall.


In the 15 years before 2020, government data shows the total number of licensed vehicles increased substantially from 184,500 in 2005 to a whopping 298,600 in 2020. However, with the pandemic affecting passenger numbers, this figure then fell by 15.9% to 251,100 in 2021. While 2022 has seen a slight increase of 3.8% back up to 260,700, this is still below pre-pandemic levels.


The position in terms of driver numbers has been rather different. Between 2005 and 2020 the number of licensed drivers increased from 242,100 to 364,700. This then fell to 342,100 in 2021 and further dropped to 330,300 in 2022, a decrease of 3.4% compared to the previous year.


But these drops haven’t been constant across the country and the figures show there has been considerable variation. With some regions experiencing small drops in numbers, while others saw large rises.


For example, between 2021 and 2022 the number of licensed vehicles in the West Midlands increased by 17.2%, while the number in the East Midlands fell by 2.3%.


Taxi licensing service Taxi Plus recently looked at the number of independent taxi companies to get an idea of where in the country it’s most difficult to get a taxi. Its research found that the worst region for getting a taxi was the North East with 3,622 people per taxi service. The West Midlands and the North West made up the rest of the ‘top’ 3.


If you’re looking for even more detail about specific trends in regions and local authorities then the government has published a series of helpful statistical tables. How is your area faring?


Why is there a shortage of taxi drivers?


With large areas of the UK returning to normal after the worst days of the pandemic, the taxi and PHV industry seems to be finding the recovery harder than most. So, why have overall numbers of taxi and PHV drivers not bounced back to meet the rising demand from customers? Let’s take a look.


When lockdown restrictions were in place during the pandemic a lot of taxi and PHV drivers saw business dry up. Many drivers saw this as an opportunity to explore new career paths and jobs with more security.


Not only did they leave to find other work as delivery or HGV drivers for companies like Amazon or the big supermarkets. In some cases drivers even retrained entirely and started new careers or businesses.


Particularly in areas where there was already a driver shortage, taxi fleets are struggling to find enough drivers to meet demand from customers. For example, this Norwich taxi company has seen driver levels reduce so significantly that they’ve had to turn away bookings in order to save on fuel and expenses. 


And even for those drivers who remained in the job there have been significant challenges, leading some to consider leaving. Alongside new HMRC taxi tax checks and the UK’s new Clean Air Zone charges, the rising cost of fuel has affected many drivers’ profitability.


Taxi and PHV drivers have long been vulnerable to assault and abuse while working. But with drivers complaining of increased abuse in the UK it seems that some have decided that enough is enough.


Industry insiders have also been complaining about licensing confusion and bureaucratic obstacles making it even harder to get into the business. On top of lengthy and expensive criminal, medical and background checks and ‘knowledge’ tests there’s a backlog in applications in many areas.


These challenges have been seen as creating a ‘perfect storm’ according to the Licensed Private Car Hire Association (LPCHA). While no one claims these background checks and exams are unnecessary, a reduction in the costs and length of time licensing takes has been urged by many.


Here at The Taxi Insurer, we’ve got lots of top tips for taxi and PHV drivers. Including our list of 23 ways to save on fuel and how to cut the cost of living as a taxi driver. From fuel efficient driving techniques to finding an affordable taxi cab insurance quote, there’s a lot you can do to keep your business ticking over.


On the positive side, a reduced number of drivers does mean more business for those who are left. But dropping taxi numbers are far from all good news for the industry.


Taxi customers have grown used to the fact taxi services are reliable and available whenever they’re needed. If hailing a taxi or booking a PHV becomes increasingly difficult, it’s only a matter of time before people start finding alternative ways to get to their destinations – which could be bad news for all concerned.


Remember that while some may see taxis as a luxury, they are often an essential form of transport in rural and remote areas. Taxis and private hires are also disproportionately used by vulnerable groups, such as the elderly.


Less taxis and PHVs on the streets can cause serious problems for some people. For example, women working in the night time economy have been calling for something to be done before someone is harmed while trying to get home after work or a night out.  


Having specialist taxi insurance in place means you can keep your business running to help meet demand.


Pros and cons of becoming a taxi driver


As customer demand continues to rise, this could be an ideal time to become a taxi driver. Whether it’s running a taxi or PHV, if you’re prepared to put in the work there are plenty of opportunities and incentives to get behind the wheel.


But be aware, no job is without its drawbacks.


Pros of becoming a taxi driver




  • Choose when, where and for how long you work
    When it comes to achieving a better work-life balance, being a professional driver could well work for you. You can set your own working hours, making it so simple to earn some extra cash in your spare time.



  • No day is ever the same
    Being a professional driver is never going to be boring for long. Meeting new people every day, you never know what’s around the corner. If you don’t fancy spending all day in an office tied to a computer, then it could be just right for you.


  • It’s fulfilling
    Taxi driving isn’t just about ferrying tourists and visitors around towns and cities. Taxis provide a vital service across the UK. Whether helping people get to work and school, visiting loved ones, or attending hospital appointments, for many isolated and vulnerable groups your taxi provides an invaluable lifeline.


Cons of becoming a taxi driver


taxi sign 


  • Working unsociable hours
    Setting your own hours is great, but it can mean you end up working very different hours from friends and family. Whether an early morning airport transfer or ferrying pub customers late at night, it can make it more difficult to spend quality time with those you love.


  • Having to work evenings and weekends
    It’s obviously up to you when you want to work, but if you want to make better money then you might need to work on weekends and in the evening.



  • You have a big responsibility to passengers and other road users
    From arranging taxi cab insurance and regular maintenance to providing excellent customer service and keeping passengers safe on the road, there’s a lot you’re responsible for when you’re a cabbie.


How much can you earn as a taxi driver?


How much you can earn as a taxi driver will depend on a whole range of factors, such as the hours you work, where you operate and how your business is set up.


According to the National Careers Service, based on a 41- to 43-hour week, the average salary for a taxi driver can range between £14,000 for a new starter up to £30,000 for a more experienced driver. 


Based on data from the Office for National Statistics, job site has found that the maximum salary can go as high as £45,000 in some places. While Indeed, says that the average salary in England is £33,218.


The average taxi driver salaries for regions in the UK are the following:


  • Scotland - £25,598.95
  • Wales - £28,979.47
  • Northern Ireland - £18,138.00
  • East Midlands - £34,044.22
  • Eastern - £31,287.93
  • London - £34,144.41
  • North East - £23,578.86
  • North West - £27,362.33
  • South East - £28,840.87
  • South West - £31,704.41
  • West Midlands - £27,273.19
  • Yorkshire and the Humber - £31,856.38


When it comes to salaries in some of the UK’s largest cities, Glassdoor has calculated the following average taxi driver salaries.

























Where to get started in the taxi driving business


If you’re wondering what do you need to become a taxi driver then we’ve got just the article for you elsewhere on our blog. Here are some great places to get started in the industry.




There are college courses you can do that provide a useful introduction to taxi driving and could give you an advantage when looking for driving work. Courses include:


  • Level 2 Certificate in Road Passenger Vehicle Driving - Taxi and Private Hire
  • Level 2 Certificate in Introduction to the Role of the Professional Taxi and Private Hire Driver

Taxi or PHV company


Many drivers get into the business by applying directly to a taxi or PHV company. Providing you've got a taxi or PHV driver's licence, and have met registration and licensing requirements you should be able to start earning quickly.


Be aware, most companies will also expect you to use your own registered vehicle. And this can be a big investment if you’re just starting out.


A useful benefit if you're employed by a larger taxi firm is that there could be the opportunity for career progression as a supervisor or manager in the dispatch control room.


Self-employed taxi or PHV driver


There’s nothing to stop you from setting up on your own from the start. But it’s usually more suited to an experienced driver who has had a few years in the game.


As a self-employed taxi driver, you could become a taxi operator and increase your potential earnings further by setting up your own taxi or PHV firm and employing other drivers.


Ride-hailing apps


If you’re wanting to get ahead of the competition and carve yourself a share of the taxi driving market then a useful idea is to link up with one of the ride hailing apps. Two of the biggest are Bolt and Uber.


Arriving in the UK in 2019, Bolt claims to charge drivers the lowest commission fees (15%) and provide the fairest treatment of drivers. It currently covers 17 cities in the UK including Bath, Bristol, Birmingham, London, Milton Keynes, Peterborough, Southampton and Wolverhampton.


Having taken the industry by storm in recent years, global ride hailing giant Uber really needs no introduction. Globally Uber claims that more drivers than ever before are now working on the ride hailing platform. Many drivers have found hooking-up with the tech giant a lucrative way of getting into the driving game.


How much do Uber drivers make? Well, in the UK, Uber tends to pay its drivers around £15 an hour which (according to figures from recruitment website Indeed) could mean an annual salary of around £20,000.


Whichever route you decide to take into the taxi business, taxi cab insurance should provide you with a high level of cover as standard. But there will also always be a range of options you can add to your policy to create bespoke cover that suits your individual business needs.


10 top tips for successful taxi fares


someone pointing at dash cam


To be successful as a taxi driver you’ll always need to be willing to go the extra mile for your passengers. Follow these ten top tips for success.


  1. Know your area so you’ll always choose the very best route for your passengers safety and comfort.
  2. Turn up on time and be professional and polite at all times.
  3. Brush up on your driving skills so passengers experience a safe and smooth drive.
  4. Take pride in everything you do. Including the appearance of both you and your vehicle.
  5. Pay attention to customers' individual needs. Are they disabled? Do they need help with luggage or pushchairs?
  6. Market your business effectively and attract customers by offering a better service rather than simply cheaper prices.
  7. Make sure to take breaks and keep yourself in good physical and mental shape.
  8. Install CCTV and a dash cam in case of accidents and other problems.
  9. Never cut corners when it comes to your personal safety or that of your passengers.
  10. Have the right taxi cab insurance and know the common exclusions.


You’ll find more advice in our 20 tips for successful taxi fares article. Can you think of any more?


Taxi cab insurance to keep you in business


Working as a taxi driver, you have to plan for the unexpected! That’s where specialist taxi insurance can help.


When you come to us, taxi cab insurance benefits can include:


  • Protected No Claims Bonus
  • Cover for Minibus, MPVs and Car
  • Cover for private and public hire
  • 24-hour claims management service
  • Pay in instalments
  • Mirror NCB from other insurance policies
  • UK-based call centre


Get a quick quote for taxi cab insurance today and help increase the number of cabbies on our roads.