Jobs are more plentiful, the overall economy has been on an upswing, and yet one-third of Americans say they need to work a side job to pay their routine expenses, according to a new survey.
And nearly half — 45% — of U.S. workers earn additional income outside of their primary career, a Bankrate study released Wednesday found.
This includes 48% of millennials. The percentage of Gen Xers and baby boomers with a side hustle is slightly lower, coming in at 39% and 28%, respectively.
Side hustlers make an average of $1,122 per month from their part-time work. That’s up from $686 last year. And approximately 40% of millennials who do work a job on the side say that gig brings in half of their monthly income.
“A lot of people are working side hustles because even though the economy is strong, wages are stagnant,” Amanda Dixon, an analyst at Bankrate, told MarketWatch. “For a lot of Americans, expenses are rising, but there are no raises at work.”
The average hourly earnings of private non-farm employees sat at $27.77 in April 2019, according to the Bureau of Labor Statistics. That same month, the Bureau put the average hourly earnings growth rate at 3.2% per year. But that percentage isn’t adjusted for inflation or changes to the costs of living. When those variables are factored into the calculation, real wages have shrunk by 0.8% over the past 12 months and by 9% since 2006, according to PayScale.
For millennials, a need to pay off student debt and a desire to have more disposable income are also common motivations for taking on additional jobs, Dixon said.
“Millennials want extra money for experiences and travel,” Dixon said. “And most haven’t reached the peak earning point in their careers yet, so a side hustle can allow them to have financial stability while also being able to do more of what they want.”
That’s the case for Josh Seefried. The 33-year-old Arlington, Virginia, resident graduated from the United States Air Force Academy in 2009. After eight years of serving, he left the Air Force to start a yachting company.
The only issue is that the job is part-time. Seefried decided to take on a bartending job on the side to earn some extra money.
“It gives me extra comfort,” he told MarketWatch. Seefried rents, lives with his partner and doesn’t have kids. He could pay all of his basic expenses with his yachting company, but the additional $2,000 a month that bartending brings in adds to his sense of financial security.
A lot of his friends, millennials who graduated college right around the time of the 2008 financial crisis, also have side hustles or simply work multiple part-time jobs.
“With the crash, our generation has already been stripped of the idea that you can sit in a corporation for 20 years and get a pension. None of us believe that anymore, so we’d rather do what we actually want to do in life,” Seefried said.
For Seefried and many millennials, that often means spending money on travel.
“I could go get a successful job in a corporation, but I’d rather chase travel and experiences and make ends meet in a bunch of different ways than work a corporate job that’s only going to let me travel two weeks a year,” Seefried said. “We just have different values as a generation.”
Side gigs include everything from working as a bartender like Seefried to running online blogs or social media accounts. The most common side hustles in 2018 were home repair and landscaping, selling products online, crafts, and child care, according to Bankrate.
“I was a little surprised Uber and Lyft weren’t on there, but I think that may change,” Dixon said.
Though Uber UBER, +0.65% and Lyft LYFT, -1.91% didn’t make it onto the list, many side hustlers, including 84% of millennials who work extra jobs, say technology plays a role in how they get their additional income.
“Technology has really changed the game for people wanting to enter this side job gig economy,” Dixon said. It’s allowing side hustlers not only to sell products online but also to market their services to a larger audience through the internet.
Despite the benefits of additional income, side hustles often come with risks and complications that many overlook.
“If you’re working part-time, you often don’t have protections and could get injured,” Dixon said.
Because side hustlers typically aren’t full-time employees, they’re generally not protected by anti-discrimination laws and in some cases, they may not be eligible for worker’s compensation if they get injured on the job. And part-time workers usually don’t qualify for company benefits such like health insurance and retirement savings plans.