Side Hustle Participation Drops as Income Rises for Those Who Stay
Fewer Americans take on side gigs, but earnings triple for those who do.
1Declining participation
Side hustle participation among Americans dropped from 44% in 2022 to just 33% in 2026, according to LendingTree data. Younger workers showed the sharpest declines, with Gen Z participation falling from 62% to 43% and millennials from 55% to 45% over the same period. Economic pressures and time constraints are pushing people away from supplemental work despite potential earnings.
2Income triples for remainers
While fewer people pursue side hustles, those who do earn significantly more. Average monthly side hustle income jumped 163% from $473 in 2022 to $1,242 in 2026. This dramatic increase suggests those continuing with side work are focusing on higher-value opportunities rather than casual gigs, creating a more professionalized side economy.
3Generational pullback
Gen Z and millennials reduced side hustle participation faster than any other demographic groups. Their sharper decline reflects both tighter schedules and better primary job opportunities compared to previous years. Younger workers appear to be prioritizing career advancement or work-life balance over supplemental income streams.
4Quality over quantity shift
Current side hustlers are focusing on consistent, higher-paying gigs rather than multiple random tasks. Examples like freelance writing, tutoring, and pet sitting demonstrate this trend toward specialized, skill-based work. This contrasts with earlier approaches that emphasized volume through gig apps or task-based platforms.
5Financial stability paradox
61% of side hustlers say they couldn't afford their lifestyle without supplemental income, yet 69% would prefer a single reliable income source. This tension highlights how side hustles serve as an imperfect solution to financial pressures, creating dependence on unpredictable earnings to cover fixed expenses.
6Time investment realities
Most side hustlers dedicate 5-10 hours weekly, but exceeding this begins competing with rest and primary job performance. The survey reveals many workers find raises or schedule changes at main jobs more efficient than maintaining separate income streams, especially with rising living costs.
7Tax implications
The IRS treats side hustle income as self-employment earnings once exceeding $400 annually, requiring quarterly estimated payments if expecting to owe $1,000+. Many hustlers fail to account for tax obligations, with experts recommending setting aside 25-30% of earnings to avoid surprises.
8Strategic approach needed
The data suggests side hustles work best when solving specific financial goals rather than serving as general safety nets. Building emergency funds (3-6 months of expenses) often provides better stability without time commitments. Workers should calculate true hourly rates and compare against main job advancement opportunities.