INFLATION HAMMER BLOW: Study show taxi and private hire among UK sectors hardest hit by inflation as operating costs jump 54%

Taxi and private hire businesses have seen their operating costs rise by 54% over the past decade, placing the sector among the UK industries most affected by inflationary pressures, according to new research from payments provider Dojo.

The findings come from Dojo’s UK Inflation Index, which analysed changes across ten core business cost categories between 2015 and 2025. The research examined expenses including energy, labour, insurance, licensing fees, technology and vehicle-related costs to assess how inflation has affected different sectors.

For taxi and private hire operators, the largest increases were recorded in

technology and training costs, both of which have risen by 100% over the ten-year period. The data suggests that growing reliance on digital booking platforms, payment technologies, compliance systems and professional development requirements have significantly increased the cost base for operators.

Other major cost increases identified by the research include materials and supplies, which rose by 88%, energy costs which climbed 80%, banking and payment processing costs which increased 71%, and rent and business rates which were up 67%.

New research shows taxi and private hire firms have faced steeper cost increases than many other UK industries, with technology, training and energy expenses driving a sharp rise in operating costs over the past decade.

Vehicle-related costs also recorded substantial growth, increasing by 63% over the period. Insurance costs rose by 60%, while licensing and mandatory fees increased by 50%. Labour costs saw a comparatively lower rise of 40%, although they remain a significant operational expense for many businesses.

The findings reflect broader challenges faced by the taxi and private hire industry in recent years, including higher vehicle acquisition costs, increased insurance premiums, rising fuel and energy expenses, and continued investment in digital technologies to meet customer expectations and regulatory requirements.

Charlie Ashworth, Head of Research and Insights at Dojo, said: “While operating costs have risen significantly over the past decade, with the right insight into their cost structure, businesses can be better equipped to respond to these pressures.”

Ashworth said businesses should focus on gaining greater control over operational spending, particularly as labour, energy, insurance and technology costs continue to reshape business economics.

He added: “For business owners, the opportunity lies in control and efficiency. With labour, energy, insurance and technology costs all contributing to long-term structural change, understanding where your exposure sits is now a strategic advantage. Reviewing supplier contracts, improving operational efficiency, reducing unnecessary overheads, and optimising payment systems can all help protect margins in a higher-cost environment.”

Ashworth also highlighted the importance of supply chain management and cost monitoring as inflationary pressures remain embedded across many sectors of the economy.

“Businesses that regularly assess their operating model, adapt pricing strategies where possible, and invest in tools that streamline transactions and reduce friction are often better positioned to absorb cost pressures without compromising service or growth,” he said.

The research points to a decade in which the cost structure of running a taxi or private hire business has changed significantly. With many operators continuing to navigate rising compliance, technology and vehicle-related expenses, the ability to manage costs efficiently is likely to remain a key factor in maintaining profitability in the years ahead.