Year-end holidays are usually joyous, filled with gift-giving and plenty to eat and drink. But with inflation surging this year, some of that cheer has been replaced with worry about how to afford those treats along with everyday necessities.
Some Americans are coping by cutting back on things they don’t need or finding cheaper options, but an increasing number of Americans are taking on side hustles.
In November, the economy added 263,000 jobs, the Bureau of Labor Statistics said on Friday, topping economists’ average forecast of 200,000, according to Dow Jones. Buried in the details, though, is a 165,000 jump in people holding multiple jobs. That’s the largest rise since June and above the 60,000 monthly average increase in the last six months, noted Comerica Bank chief economist Bill Adams.
This trend was also noted in the Federal Reserve’s Beige Book, which chronicles economic conditions in different regions across the country.
“Nonprofit service providers noted an uptick in the number of clients relying on side gigs to make ends meet or as pathways to financial self-sufficiency,” the Atlanta Fed said in its portion of the report last week.
Who’s taking extra work?
Most adults (68%) either already have or plan to pick up a side gig, like delivering food with DoorDash or renting out extra space in their homes, according to a Neighbor.com survey of 1,000 people.
Additionally, 44% of Americans work or plan to work a seasonal job, like shipping packages for Amazon or stocking and unloading for Walmart. And 51% either work or plan to work overtime at their current 9-5 job, the survey said.
Of those taking on extra jobs, 18 to 40-year-olds remain the largest group of side hustlers, said Kathy Kristof, editor at SideHusl, which researches opportunities to make extra money. “But over the last six months, we’ve seen an increasing number of seniors looking to help make ends meet,” she said.
Why are people taking side hustles?
The highest inflation in a generation has ravaged household budgets, with many Americans increasingly dipping into savings and racking up credit card debt to pay for everyday items. The personal savings rate dropped in October to 2.3%, the lowest in 17 years, the Commerce Department said on Thursday.
Meanwhile, third-quarter household debt climbed at the fastest annual pace since 2008, with credit card balances rising by 15%, the most in 20 years, Fed data showed. The surge came even as credit card interest rates rose to the highest level since the mid-1980s, according to Bankrate data.
More than 4 out of 5 Americans who have or plan to take on a side gig, seasonal job, or extra hours at work say inflation played a role in their decision, Neighbor.com said.