What demographics are picking up extra income?
With inflation straining household budgets, more than half of Americans have turned to side hustles to make ends meet, according to a MarketWatch Guides survey conducted in early 2024. This trend is even more common among younger generations, with 71 percent of Gen Z and 68 percent of Millennials engaging in side hustles. Even 32 percent of Baby Boomers have some type of side gig.
The survey also revealed that two-thirds of Americans are living paycheck to paycheck, showing that even with extra jobs, many remain financially insecure. Among those with side hustles, 44 percent report ongoing financial uncertainty, citing the high cost of living (30 percent) and insufficient income (22 percent) as major obstacles to achieving financial stability.
How do people make the time to work extra hours? Vistaprint says that 48 percent of side hustlers work on their gig over the weekends, and 59 percent report working from 5 to 9 p.m. through the week.
Inflation has been a significant factor in driving this trend. From late 2020 to mid-2022, inflation outpaced wage growth, meaning that even as incomes rose, purchasing power declined. In June 2022, inflation peaked at 9.1 percent, while wage growth lagged at 5.3 percent. Although inflation has since moderated, it remains above the Federal Reserve’s target, continuing to pressure household finances.
The situation is particularly challenging for Baby Boomers, many of whom are nearing or at retirement age. As retirees living on fixed incomes, they have been hit hard by rising costs without benefiting from wage increases. This may explain why nearly one-third of Baby Boomers have turned to side hustles to supplement their income.
According to Bankrate, working for extra income 12 hours per week earns a median of $1,122 per month. But 40 percent of Millennials say their side hustle makes up at least half of their monthly earnings. The Motley Fool revealed a significant discrepancy in earnings by gender, with men earning an average of $989 per month and women reporting $361 on their side jobs. The gap also shows more labor-intensive jobs for men such as repairs or landscaping.
As economic stressors and aging demographics collide, the side hustle phenomenon appears here to stay—offering a tangible opportunity for direct selling companies to provide much needed relief and flexibility.
From the October 2024 issue of Direct Selling News magazine.
