In the past, having a job has meant just that: a single occupation. But huge leaps forward in mobile technology and global events (including the pandemic and the highest inflation since the 1980s) has meant that methods of working, and ways of earning a living, have rapidly broadened in the past couple of decades. What was once seen as a precarious and undesirable existence is increasingly becoming the opposite, where diversification means income security, not necessarily job security.
The importance of diversifying your earnings
According to a recent report co-authored by the Centre of Economics and Business Research (Cebr), there are more than 20m people in the UK alone who have multiple streams of income. They can earn an average of nearly £10,000 per year from ‘side hustles’, predicted to rise a further 25% by 2025. This isn’t happening in a vacuum, either. It’s a reflection of the need to both have greater security of income, but also of the emergence of new verticals – most famously the gig economy, which includes the likes of Uber and Deliveroo. These occupations allow employees much greater flexibility in terms of defining their own hours, moving away from a dependency on ‘9 to 5’ occupations that can interfere with other priorities, or traditional ‘second jobs’ – such as hospitality – that often means a lower quality of life due to their unsociable hours.
Identify new ways to gain secondary income
The report, which was also produced by Utility Warehouse (UW), describes this emergent category of workers as multi-income individuals, or Miis. While concepts like shorter-term contracts and the gig economy are relatively well understood, the options for Miis are in fact much more widespread. They are also continually growing, driven by technology and digital platforms. They include leveraging either existing assets (renting, hosting and investing), existing passion points and skills (video gaming, tutoring, blogging and vlogging) and much more specific situational opportunities, such as online surveys or even shovelling snow.
As you might expect, finding a secondary occupation that fits with your talents and your lifestyle is the optimal approach. For example, if you’re creative, some of the best income opportunities include being paid to create content, or selling items you’ve made. If you have an eye for a bargain or a trend, reselling items you’ve acquired at low cost for a profit can be lucrative over time.
Another option is becoming a UW Partner. UW is a FTSE 250-listed utility company that offers consumers discounts on their household bills. The more services you switch, the more you save. The company relies on qualified distributors to sell its services to end customers. These people, known as Partners, earn commission – and potentially recurring income, much like a royalty – on the customers they sign up. Over time, much like a pension pot, this income compounds. In fact, many Partners end up treating their income from UW as a pension fund.
The advantages of a secondary income
As the saying goes, everyone should get paid for doing what they do best. For those of us not lucky enough to find that through their primary job, the emergence of the Mii category makes this much more feasible. No longer is making money from a hobby a pipe dream.
So, aside from the increased likelihood of satisfaction that comes from work that fits with your true talents, developing multiple income streams also means developing a broader skill-set – and that can only be beneficial.
It also means contingency in the event one of your revenue streams is removed, as often happens during economic downturns. The UW report found that in the UK, over two thirds of Miis started out as a result of pressure on household finances.
It also revealed that the emergence of Miis in some sectors is particularly advanced. In education, for example, 45% of workers (1.5m) have taken on a side hustle or second job.
Supplementing your income means you will open the door to putting the extra capital to work – from property, investing or any asset class. Indeed, research clearly shows that the richest in society leverage not one, but an average of six sources of revenue.
Finally, as workers increasingly diversify their income away from a single source, these traditional employers will need to find greater incentives to retain talent, which means facilitating more flexible forms of working, and increasing wages to remain competitive.
