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Gen Z has side hustles because they fear layoffs

Gen Z has side hustles because they fear layoffs


Moonlighting used to be considered a sign of poor financial planning, an admission that one’s current salary wasn’t enough to live off of. Or perhaps it was and had just been squandered on frivolities. A second job was considered the professional equivalent of grade school remedial classes. 

But not for Gen Z, for whom side hustles aren’t just common, but coveted. Forty percent of Gen Z, the oldest of whom are now 26, say they made money from both a job and a side hustle, according to a survey from consulting firm EY. There’s both a norm and a cool factor to it, EY Americas’ cultural insights and customer strategy leader Marcie Merriman tells Fortune, as Gen Z pushes to rethink workplace norms by not devoting themselves entirely to their careers while navigating a cutthroat job market that’s left them afraid for their financial futures. 

A side hustle is, if nothing else, a way for Gen Z to make extra money in turbulent economic times. In a separate, not yet published survey that EY shared with Fortune, 73% of Gen Z said they have a side hustle to “make more money.” It’s a way to hedge against the financial turmoil that can happen when the economy goes south and firms cut their employees loose, Merriman says. Gen Z were raised by parents who lived through the worst of the 2008 financial crisis. They watched millennials graduate college and enter the job market at the nadir of the Great Recession. And they themselves came of age in the midst of the COVID-19 pandemic, which brought the economy to a standstill and saw record layoffs in March and April 2020

“What they have seen, if nothing else, is organizations will cut back, take steps in order to keep their profitability in a heartbeat,” Merriman says. “They’ve seen it happen to their parents, they’ve seen it happen to millennials, and in the last few years, many of them have experienced it themselves.” 

Witnessing the realities of a bad economy firsthand led them to reexamine their priorities with a renewed sense of pragmatism about their financial stability, according to EY’s report. Fifty-two percent say they’re worried about not having enough money, and 39% say they’re extremely stressed about making the wrong choices with their money. The tumult of the last decade left such a lasting impression that, in the same unreleased survey, 15% of Gen Z said they work a side hustle to save for retirement—a staggering number considering respondents are in their teens and 20s. 

Side hustles are viewed “as a pragmatic decision and a symbol of independence. It is not necessarily based out of necessity or passion, it is viewed as the smart thing to do,” the report says.  

Gen Z is open to side hustles because their identities aren’t tied to their careers

Gen Z is also rethinking how much of themselves they want to give to their employers. While they want to do their job well, they’re wary of tying their identity to work and how much they work. The prevalence and acceptance of side hustles is borne from the idea that Gen Z doesn’t derive their self worth exclusively from their performance at work, as many previous generations of professionals did.  

Boomers considered bleary-eyed all-nighters at the office and skipping family functions as the cost of doing business when it came to ascending the corporate ladder. Millennials already started shifting attitudes toward work-life balance and gig work, though mostly to make ends meet. Gen Z took it a step further and decided they were distinctly disinterested in tying their identity to their careers, making them more open to the idea of trying their hand at a side hustle. To them, “personal sacrifice does not equal professional value,” Merriman says. 

“Personal sacrifice is much more of an industrial era measure of when it was about punching a clock and how many hours you’re putting in,” she adds. “We’re not in that era. We’re in the digital era.” 

Gen Z’s openness to side hustles, their ability to shed it of any stigmas, and their lack of interest in proving themselves through sacrifice—which they view as needless and without reward—is also because they have seemingly viable alternatives to desk jobs. The internet removed many of the barriers to getting a side job, according to Merriman. Ecommerce and social media suddenly gave aspiring creatives a marketplace to sell their work; and for the more type-A Gen Zers, it provided a world’s worth of networking opportunities that suddenly made watercooler talk seem inconsequential. “Their digital upbringing really opened those doors past generations didn’t have,” Merriman says. 

And that’s changed how Gen Z aspires to make money, even if, like other generations, they might still fantasize about easy money. “For Gen X, the rock band or the garage band was the dream of how you make money,” Merriman says. “For this generation, it’s being an influencer and having more followers than anybody else.”

Employers shouldn’t fight Gen Z’s love of the side hustle  

They don’t see the need to prove their success through long hours and corporate ladder climbing. They don’t consider their “day job” to be their only path to striking it rich. In fact, they’re not even that interested in getting rich at all. EY’s report compares a 2006 Pew Research Study of millennials—when most were the same age as the Gen Zers in the EY survey—which showed that eight in ten considered getting rich the first or second most important goal in their lives. In the EY study, fewer than a third of Gen Z said that was the case. 

Like most generations, especially ones so intent on shaking up entrenched norms, Gen Z gets saddled with the reputation of being lazy. EY’s research cautions employers against that sort of thinking. (About 40% of Gen Z is working two jobs, after all.) Employers should “understand that while they will never have 100% of Gen Z’s dedicated time, these early-career workers are fully wired to give their full-time job 100% effort while also managing their side streams,” the report says.  

Merriman too doesn’t see this as cause for concern for employers. Rather than a deterioration of the collective work ethic, it’s simply an evolution of the professional status quo, she says. What started with millennials who coined the terms “gig economy” and “side hustle” and made moonlighting no longer taboo is culminating with Gen Z. “Gen Z is normalizing the side hustle,” she says. 

The report is even more definitive than Merriman that Gen Z is bringing about a permanent shift in the workplace. “It wasn’t so long ago that the working world questioned the ability of women to do their job effectively as they got married or had children, some were even fired for it,” EY’s report reads. “In coming years, today’s restrictive view of an employee having multiple income streams in addition to their employer will be considered equally dated.”


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