Do you feel like you need to take on a second job to keep up with rising prices? If so, you’re not alone. The cost of living rose 8.2% in September, while wages rose just 5.1%. And there are still jobs to be had.
The labor market remains healthy, for now at least. The economy added 261,000 new jobs in October. The Federal Reserve, meanwhile, worries strong jobs figures will keep inflation at a 40-year high.
The unemployment rate rose to 3.7% in October from 3.5% the month before, the Bureau of Labor Statistics also said Friday, as more people lost jobs and the size of the labor force shrank slightly.
Still, a robust labor market and rising prices seem to have convinced 70% of workers — from Generation Z to baby boomers — to consider some kind of gig work to supplement their finances over the past year.
Roughly one-third of Americans also reported that they have pursued some kind of side hustle. That’s according to a survey released this week by Prudential Financial, which polled more than 4,500 U.S. adults.
People’s bank balances appear to be dropping as prices rise. The personal saving rate — saving as a percentage of disposable income — fell to 3.3% in the third quarter from 3.4% in the prior quarter, the lowest since the Great Recession.
“People’s bank balances appear to be dropping as prices rise. Roughly one-third of Americans say they have pursued a side hustle.”
So what kind of gigs are people seriously considering and/or pursuing? Some 40% say they looking for “convenience work” such as ride-sharing and meal preparation, 28% are reselling old goods, and 22% are making their own craft goods.
Inflation has not affected everyone equally. More than half of women surveyed (53%) by Prudential Financial say they cannot afford their current lifestyle or are barely getting by — while 40% of men said the same thing.
But people feel empowered and emboldened. “The pandemic has made workers rethink what they want out of their careers and make trade offs,” Prudential added. “A quarter of Gen Z workers say the past three years have made them want to work for themselves.”
“It can be easy for good spending and savings habits to slip,” said Brandon Goldstein, a financial planner with Prudential. “As a millennial myself, I know how tough it can be to balance financial responsibility with having a social life.”
Goldstein said travel, socializing and even gifts for the holiday season all add up. “It’s imperative to assess and prioritize what’s critical,” he said, “so you can stick within your budget and not lose sight of your long-term financial goals too.”