This category covers establishments engaged primarily in furnishing passenger transportation by automobiles not operated on regular schedules or between fixed terminals. Taxicab fleet owners and organizations are included, regardless of whether drivers are hired or rent their cabs or are otherwise compensated. Establishments primarily engaged in furnishing passenger transportation by automobile or bus—to, from, or between airports or rail terminals—over regular routes, are classified under SIC 4111: Local and Suburban Transit. Taxi cab associations and similar organizations that supply maintenance and repair services to their members are classified under SIC 4173: Bus Terminal and Service Facilities.
In the latter 1990s, U.S. consumers spent an estimated $10.5 billion annually on taxis. By 2001, there were 3,086 taxi service establishments, employing a total of 30,281 workers with a payroll of $489 million. Most of the companies were small; approximately 2,500 employed fewer than 10 workers. The majority of the drivers were either independent contractors licensed through and renting their vehicles from the taxi companies, or owner-operators affiliated with a taxi company or association. The industry continued to face competition from limousine services, executive sedans, and airport/hotel shuttle services. To compete, by 2003 taxi services were offering online bookings and vehicles equipped with televisions, as well as newer, more fuel-efficient vehicles.
Most taxi companies followed a similar organizational pattern. Managers—sometimes the company owners—ran the business, hired drivers, and performed other administrative duties. Dispatchers took calls and assigned cabs to passenger locations. In large companies, some dispatchers worked in two-person teams, one taking incoming calls and the other dispatching them. The position of dispatcher once represented a promotion awarded to experienced cab drivers, whose familiarity with the city best qualified them for the job. However, the increase in computer-based dispatching in the early 1990s prompted cab companies to favor computer skills over specialized knowledge of local geography when filling the dispatcher position.
Regulation of the U.S. taxi industry varied from city to city. While almost all cities had some form of licensing requirements, larger urban areas had the strictest regulations. In New York, for example, the number of licenses or "medallions" allotted the industry remained at...