The State of Side Jobs and Gig Work in 2020
Part-time jobs and side hustles have become increasingly common over the past decade. In fact, 43% of full-time US workers have some sort of gig outside of their primary job (50% for those under 35). Some people work a side job because it involves a passion of theirs or simply to keep themselves busy. For most, however, it comes down to money.
Nearly 70% of people with extra jobs work them for financial reasons. Personal debt is higher than ever thanks to rising college costs, and home (and rent) prices have long outpaced inflation. Meanwhile, proper retirement plans and pensions have all but disappeared from the job market. Side jobs provide a way for some US adults to get ahead.
To find work and earn the money needed, people regularly leverage the power of modern technology in an increasingly connected world, leading to the creation of what’s known as the gig economy. Though accessible and convenient, this new frontier has brought growing concerns revolving around a lack of consistency, low pay rates, zero benefits, and more.
With the outbreak of COVID-19 and the quarantine that followed, some sectors of the gig economy exploded, while others all but dried up. In both cases, many workers found themselves struggling to earn the money they had come to rely on.
The World Turned Upside Down
Independent contractors, gig workers, and those relying on secondary means of income were some of the hardest hit groups as quarantine measures went into effect. In an online poll we posted for independent contractors and gig workers, 67% of respondents said COVID-19 had a substantially negative impact on their workload. In many cases, its not that the work opportunities disappeared.
The competition simply became too prevalent.
As hundreds of thousands of businesses permanently closed and affected industries laid off as many as 50% of their staffs, newly unemployed people flooded freelancing sites, sharing economy apps, and similar platforms. Upwork and Flexjobs have seen their traffic increase by 50% or more, resulting in much fiercer competition for jobs and noticeably lower pay rates.
Gig-based apps have seen similar patterns.
Even as demand for delivery and online ordering has rapidly increased, job availability for workers is often scarce. Amazon Flex drivers are finding it near impossible to get jobs before they’re snatched up by someone else. If they do manage to land a job, they’ll likely end up earning less than before. Amazon Flex drivers have reported rates being $10 less per hour than they were pre-COVID. The same is true for those using DoorDash and Uber Eats.
With fewer opportunities and lower pay, gig workers are suffering major losses to their monthly income.
What Comes Next?
Even as businesses, restaurants, and churches have resumed operations, many are still dealing with the fallout. There is a small silver lining here for those who operate within the gig economy; it is now nearly impossible to ignore the long-standing problems facing gig-based workers.
There have been attempts at change in the past. Bills have been proposed as far back as 2017 to offer some form of benefits to freelancers, contract workers, and part-time employees. In recent months, we’ve seen some significant progress as the CARES Act extended unemployment coverage to independent contractors, part time employees, and more.
However, the coverage doesn’t always apply to those with regular jobs who lost their side hustles (or saw their earning drop drastically) due to COVID-19. It’s easy to brush this off and say that these people should be thankful they have full-time jobs, but it’s important to remember that many of these same people rely on the money they receive from these secondary jobs.
Working Americans earn an average of $1122 from their side hustle every month. That is certainly not an insignificant amount of money. In an upcoming post, we’ll be sharing stories from people we’ve talked to who rely on side jobs and gig-work. In the meantime, if you’re in a financially healthy spot, look for ways you can support the side hustles and secondary offerings of the people you know.
The New Torrch is Coming...
We’re currently building the next generation of Torrch. One of the key features will be the ability for service providers and gig workers to find paid work opportunities within their church or local community. We believe this will be a great benefit for people relying on secondary income, especially in times like these.
If you’d like to be kept in the loop on future news and updates, please fill out the fields below.