Why It Matters That More Americans Are Getting Second Jobs

Labor Trend

The state of the labor market tells us a lot about the health of the U.S. economy. A soft jobs report can signal economic weakness, while a strong job market begets rising wages, more spending, and thus, economic growth.

But other trends in the labor market aren’t quite as obvious. For example, the number of Americans working multiple jobs has been steadily ticking up, rising from a pandemic-era level of around 4% to more than 5% in recent months, per data from the Bureau of Labor Statistics. But what does this mean for the economy?

Two Sides to Two Jobs

More Americans working multiple jobs could be a sign that it’s getting harder to make ends meet on just one income after years of inflation pushed up prices for essentials like rent, insurance, and food. This reason for getting a second job reflects how hard it is for some Americans to make ends meet. Economists call the economy bifurcated, or k-shaped, to represent that not all Americans are experiencing it in the same way.

At the same time, America’s work landscape has also changed in the years since the pandemic. The rising popularity of remote work and the gig economy mean that workers can pick up side hustles with flexible schedules on short notice. But this benefit often comes at the expense of less job security or fewer benefits in the long run.

Where Are We Headed?

Economists are keenly looking out for signs whether the economy is taking a turn for the worse. Softening in the labor market over the summer, with fewer jobs added to the economy in the past months, has given many the impression that a slowing in economic growth may be next.

Meanwhile, the Federal Reserve, which hiked interest rates in its fight against high inflation, is widely expected to start reducing rates later this month, which should have a stimulating effect on the economy.

We’re staying tuned.

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