EDITOR'S NOTE: The Great Resignation following the pandemic gave Americans an unprecedented advantage in the labor market. Employee shortages meant that workers, active or unemployed, had more options and wage bargaining power than at any other time in the past. Some took advantage of it, while others waited. Eventually, rapid inflation would catch up to all consumers, and what began as a tremendous labor advantage ended up as a scramble for more income. Around 70% of all Americans are now looking for “extra” work to keep up with the rising cost of living. But since the Federal Reserve is aiming to aggressively push down inflation by hiking interest rates to put the brakes on economic growth, jobs may become a necessary casualty. As Fed Chair Jerome Powell mentioned in a speech following the last FOMC announcement, the unemployment rate will likely tick up. So, what’s to happen to these Americans looking for extra work, or just plain work, when companies begin laying off workers?
A few months ago, Mike Petree noticed an alarming pattern: His bank account would get uncomfortably low on the weekends before he’d get his paycheck, paid biweekly on Wednesdays.
Despite no changes to their daily habits, bills for him and his family of five skyrocketed: a $120 weekly grocery bill ballooned to $200, and a $50 gas tank refill doubled to nearly $100 per top-up.
“A couple of times, we’ve had to put our groceries on a Discover card to make sure we had food for the week,” says Petree, 45, of Louisville, Kentucky, who works for a credit card processor. He’s noticed other essential costs, like utility bills, have gone up in the last year, too.
Petree says he and his wife, who works as an activities director at a nursing home, make “decent money” and used to be able to cover all of their needs comfortably just months ago.
But with skyrocketing inflation, which rose to 8.3% year over year in August, that’s no longer the case.
Starting this week, Petree will work his full-time job during the week and as a part-time cashier at Lowe’s on the weekends.
Cutting costs isn’t enough — people are working more to cover inflation
Petree is just one of many Americans responding to inflation by working extra hours, applying to second jobs and finding gig work to make ends meet.
Nearly 70% of Americans are looking for extra work to combat inflation, according to more than 1,000 full-time workers, part-time workers and unemployed workers surveyed by Bluecrew, a workforce-as-a-service platform, in September.
Already, 85% of Americans said they’ve changed their spending habits due to inflation, 72% say it’s impacted the way they view their job and 57% have sought out new or additional roles in the past year, according to the survey.
“Rapid inflation is forcing people to look at not only how they’re spending their money, but also how they’re earning their money,” says Matt Laurinas, chief customer officer at Bluecrew.
In many cases, those looking for work already log 40 hours during the week and are picking up extra shifts or gig work on nights and weekends, Laurinas says.
Others taking on additional work include people who hold hourly jobs and want more hours with another company, or parents who have caregiving needs during the week and need to work weekends while a partner or family member can provide care.
High inflation and economic concerns could already be driving a rebound in labor force participation rates and the number of hours people want to work, both of which dropped during the pandemic, according to reporting from The Wall Street Journal.
What recession concerns could mean for extra work
Employers have been hiring in a tight market by upping pay and trying to edge out competition with other perks, such as flexible schedules, free food or a greater focus on employee recognition.
But concerns over a recession and future consumer spending could cause some companies to scale back, Laurinas says. For example, Walmart recently announced plans to hire 40,000 workers for the holiday season, down from 150,000 retail workers and 20,000 supply chain workers hired last year.
That could be trouble for the half of surveyed workers who plan to take up seasonal jobs during the holidays to cover their bills. Another 58% of respondents are interested in short-term gig work, which Bluecrew defines as picking up multiple assignments with different companies at one time.
Many workers are already planning to change their job picture in the new year to keep pace with rising costs: 65% of people say they foresee themselves looking for new opportunities in 2023. That number could go up if a recession causes unemployment to rise.
Workers say pay is the most important thing to them when accepting a new job, followed by location, scheduling (like being able to take morning v. nights v. weekend shifts), flexibility (like the ability to call out when needed) and opportunities for growth, per the Bluecrew survey.
As for Petree, he actually picked up his second job at the recommendation of a coworker who did the same thing. At $15 an hour and 20 hours per week, he hopes it’ll take the sting out of rising prices for his family.
He does worry taking extra shifts could lead to burnout. Rather than work seven days a week, he’s considering taking a 6 a.m. to 10 a.m. shift with Lowe’s on weekdays before he starts his 11 a.m. to 8 p.m. full-time job.
It would be a long day, he admits, but what’s best for him and his family given the circumstances.
Originally published on CNBC.