Young adults are increasingly turning to gig work to make ends meet, but it’s not enough to keep up with the rising cost of living, according to a new analysis from Bank of America.
The analysis found that millennials and Gen Zers are side hustling at a higher rate than ever before, with 4.3% of millennials and 3.6% of Gen Zers receiving income from gig work as of August. However, despite the increase in gig work, their credit and debit spending growth is still slower than that of baby boomers.
This suggests that they’re facing relatively more financial stress, according to Anna Zhou, economist at Bank of America Institute and the report’s author. She says the younger generation is actually pulling back in terms of spending versus a year ago, but for baby boomers, they’re still spending at a level that’s higher than a year ago.
One of the reasons for this trend is that younger generations are more likely to be in entry-level positions with lower wages. Second, they’re more likely to be living in high-cost areas, such as major cities. Third, they’re more likely to have student loan debt.
As a result, many young adults are struggling to make ends meet, even with the extra income from gig work. This is causing them to be more cautious about their spending.
The analysis also found that younger generations are more likely to be saving money than baby boomers. This suggests that they’re taking their financial situation seriously and are trying to build a financial cushion for the future.
The sources for this piece include an article in Yahoo.