Working a side hustle has become a need for millions of people.
The number of Americans who have some form of side hustle to make extra money—or even need one to get by—has skyrocketed the past three years. The COVID-19 pandemic, rising inflation and technology advancements have helped fuel the rising trend. This is good news for the direct selling industry seeking part-time independent distributors.
According to a survey by small-business insurance company Insuranks, 93 percent of Americans in 2022 have attempted to make money outside of their main source of income with 44 percent saying they need a side hustle to cover monthly bills. That’s up from around 34 percent in December 2020. Many respondents (28 percent) said rapid inflation has pushed them to search for additional ways to earn income. Around one-third said they just enjoy working side gigs.
“Unfortunately, due to high inflation and other financial burdens, more side hustlers are working a side job just to make ends meet,” shared Ted Rossman, Senior Industry Analyst for Bankrate. “Instead of using this income to boost savings, knock out debt or pay for a vacation, there has been a big increase in people who simply use these funds to pay for everyday living expenses.”
Studies by Zapier dig a little deeper into who is starting side hustles, how long they spend on working them as well as the average income they make. On average, Americans spend 13.4 hours per week and are earning more than $12,000 per year working their side hustle. Nearly 37 percent say they make $5,000 or more annually. Roughly 36 percent of people started or planned to start a side hustle in 2022, compared to 24 percent who said the same for 2021. Men and young adults are most likely to start a side hustle, with 44 percent of men and 37 percent of women saying they currently have one.
In terms of age groups, Gen Z (ages 18 to 25) and Millennials (ages 26 to 41) are more likely than Gen X (ages 42 to 57) and Boomers (ages 58 to 76) to say that they currently have a side hustle. However, older adults are spending more time working, while younger adults are earning a higher income per hours worked. Sixty-four percent of Gen Z say they spend less than 10 hours a week working their side hustle compared to 40 percent of Millennials, 36 percent of Gen X and 42 percent of Boomers. On average, Gen Z earns roughly the same amount per year compared to Gen X ($9,537 vs. $9,628).
According to surveys by Self Inc., people spend their side hustle money on: regular bills and household expenses (34.7 percent); disposable income (32.2 percent); and savings and investments (29.8 percent). More than 60 percent of respondents said their side hustles began as a hobby.
While the number of people working a side hustle has drastically increased, more than three-fourths of respondents in the Self Inc. survey say they have been working one for less than three years. Just 9.5 percent said more than five years; 18.3 percent said two to three years; 20.8 percent said one to two years; and 19.7 percent said less than six months. Nearly 50 percent said they started their side hustle because of the COVID-19 pandemic uncertainty and job market downturns.
From the December 2022 issue of Direct Selling News magazine.