Got a Side Hustle? Here’s What You Need to Know in 2022
Whether by choice or necessity, side gigs appear to be here to stay.
From ride-sharing to food delivery to at-home businesses and traditional freelance gigs, Americans are getting more creative in how they earn side cash. In fact, according to the Pew Research Center, 16% of Americans have earned income from an online gig platform at some point. In a Bankrate survey, 45% of respondents said they have a side hustle.
With gig work as popular as ever, here are some trends to help you in your side hustle this year.
4 Side Gig Trends to Watch This Year
1. Side Gigs are Becoming Permanent Gigs (For Now)
Side gigs are becoming more like main gigs for many Americans. Forty-one percent of gig workers relied on their side hustle to cover monthly expenses in 2021. That’s up from 27% in 2020, according to Dollar Sprout’s 2021 Side Hustle Report.
The percentage of people spending more than 15 hours per week on gig work more than doubled in 2021, and the share of gig workers who earned more than $1,500 per month increased to more than 14% in 2021.
That said, even though workers are making more money and spending more time than ever on side work, many still don’t view the side hustle as a great long-term option. In the Pew survey, only 31% believed these jobs are a good way to build a career.
If you don’t want to rely on a side gig forever, it’s vital that you make an exit plan. That might involve setting some specific personal and financial goals to make the one steady job a reality.
If you’re seeking a better balance between your side gig and your full-time job,look at your day-to-day routines and see if your current schedule is using your time most efficiently – or if there are ways you could reprioritize your daily checklists between both jobs.
2. The Employee vs. Independent Contractor Debate Continues
In late 2020, California voters passed a measure known as Proposition 22. The debate centered on whether ride-share drivers could be considered employees or independent contractors while working for companies like Uber and Lyft.
If gig workers are classified as employees, rideshare companies would have to provide health insurance, workers compensation for on-the-job injuries, contributions into Social Security and Unemployment Insurance and sick leave. If gig workers remain classified as independent contractors — as the vast majority are — companies would not have to provide those benefits.
Prop 22 was largely seen as a compromise. Rideshare companies in California are still exempt from labor laws and can keep their drivers classified as independent contractors. However, drivers are receiving new benefits which include an earnings guarantee, a health care subsidy and occupational accident insurance.
The upside to being an independent contractor? Obviously, the flexibility involved with setting your own hours and the freedom to be your own boss. Employers often pay independent contractors better hourly rates — a great perk.
The downside of being your own boss? Independent contractor taxes, for starters. You’ll be paying taxes out of pocket, and the general rule is to set aside 30% to 35% each quarter. You’ll also need to make sure you have W-2s from all of your clients. If it gets complicated enough, you might think about hiring an accountant.
3. Gig Work Continues Even as the Pandemic Winds Down
The COVID-19 pandemic truly fast-tracked gig work in America. What used to be an occasional option for some extra cash became a necessity for workers to make ends meet.
And consumers have become accustomed to the services many gig workers provide. The demand for delivery services has soared in the last two years. People may not fear going to the grocery store like they once did, but many have gotten used to the convenience of having food brought to their doorstep.
In the approaching post-pandemic world, some side gigs are here to stay. Others, like contact tracing and poll work, are less in demand.
But those skill sets are transferable. Contact tracers could use their skills as a stepping stone to a data entry or analysis position. Poll workers might think about a role in a local government administrator’s office. And, with so many parents becoming stay-at-home teachers over the past two years, now might be a great time to transition into an online tutoring or substitute teaching gig.
Other industries, like catering, have completely opened back up. With wedding season quickly approaching, catering side gigs will be in high demand and will offer many opportunities to make some extra cash.
4. Gig Work Isn’t Confined to One Generation
Side gigs are open to all generations, and all generations are taking advantage of them.
“In the midst of a historic labor shortage, we’re seeing a steady increase in eager workers seeking flexible opportunities to increase their earning potential,” said Monica Plaza, with online staffing company Wonolo, in a press release. “Across all generations from Baby Boomers to Gen Z, the data shows us workers are re-evaluating what they want … flexible work that pays a living wage.”
For some retirees, gig work affords them the opportunity to make extra money and stay active during their golden years. From pet sitters and tour guides to bus drivers and substitute teachers, retirees are finding creative ways to make income in this current environment.
College students have plenty of options too. We recently outlined 13 online jobs that pay more than $15 per hour. And work-from-home parents are seeing more opportunities in gig work – whether it’s freelance writing and editing, online tutors or virtual recruiters.
Robert Bruce is a senior writer for The Penny Hoarder.