Gen Z Is Quitting Side Hustles Faster Than Everyone Else

The side hustle, long treated as the default financial move for a generation raised on gig apps, is losing steam. Side hustles grew nearly every year of the last decade; now a new national survey shows participation falling across every generation, with the sharpest drop among Gen Z.

LendingTree surveyed 2,049 U.S. consumers in early March and found that 33 percent report having a side hustle in 2026, compared with 38 percent last year and 44 percent in 2022, according to the survey results published in April. Among Gen Z adults ages 18 to 29, participation fell to 43 percent from 57 percent a year earlier and 62 percent in 2022, the steepest decline of any generation.

Fewer side hustles, bigger payouts

The paradox at the center of the data is that the people still working side hustles are earning more than ever. The average side hustler now brings in $1,242 a month, up from $1,215 last year and more than double the $473 average recorded in 2022. Fewer people are doing the work, but the ones who remain have found ways to charge more or work more efficiently.

Gig and on-demand work still tops the list of side hustle types, claimed by 29 percent of side hustlers. Freelance and professional services like tutoring, consulting, and online freelancing come next at 26 percent, followed by creative, content, and media activities such as e-commerce resale at 23 percent. Most side hustlers keep the time commitment modest: 32 percent put in five to ten hours a week, and 37 percent have kept their hustle going for one to two years.

Matt Schulz, LendingTree's chief consumer finance analyst, said the combination of falling participation and rising income makes sense once you look at what it takes to get started. Even though starting a side hustle has gotten cheaper, he noted, it still typically costs money, and inflation has squeezed the budgets people would need to launch one.

Gen Z walked away first

Millennials also pulled back, with 45 percent reporting a side hustle in 2026 versus 50 percent last year and 55 percent in 2022. But the Gen Z reversal is more dramatic because the generation once led every survey on the subject. The shift suggests that the romantic idea that everyone should keep something extra going on the side is giving way to something more practical.

The reasons people start side hustles have not changed much. Covering cost-of-living expenses and discretionary spending or saving tied as the top reasons at 32 percent each, while 25 percent said they needed the money for essential bills. Asked about the bigger forces behind the decision, 36 percent pointed to the current economy and 31 percent to inflation, with 26 percent citing rising housing costs.

At the same time, interest has not died. More than half of all Americans, 55 percent, say they are likely to start a side hustle within the next year. Newcomers may refill the ranks even as current side hustlers step back. Among Gen Z, 35 percent said they plan to keep working side hustles until their primary job pays a higher income, suggesting many see the extra work as a temporary bridge rather than a permanent lifestyle. Others may be swapping gig work for more formal paths: a recent report on Gen Z interest in skilled trades found nearly half considering that leap, while research on workplace AI shows workers are already spending their own money to stay employable.

A separate poll points to where some of that ambition may be going. RBC's 2026 Small Business Poll, released Sept. 16, found that 46 percent of Gen Z business owners in Canada are running a side venture while holding a full-time job, and two-thirds of Gen Z Canadians overall said they have considered starting a business, according to the poll results. The side hustle, it seems, is evolving from extra gig work into early-stage entrepreneurship.

The money people cannot afford to lose

For those who have one, side hustle income is essential to their budgets. Sixty-one percent of side hustlers said their life would be unaffordable without the extra income, the same share as last year. Eighty percent said the work improves their quality of life, and 49 percent said it contributes to their long-term financial security.

Yet most would trade side hustles away if they could. Sixty-nine percent of side hustlers said they would prefer a single, steady source of income if given the option, up from 65 percent last year. If the side income vanished tomorrow, 39 percent said they would cut dining out, 37 percent would reduce shopping, 33 percent would spend less on entertainment, and 32 percent would trim streaming services.

Schulz cautioned that leaning on side hustle income to cover rising costs carries its own risk. "Relying on side hustles can be risky, in large part because of how unpredictable side hustle income can be," he said. "It is difficult to have a meaningful budget if you can never be quite sure how much money you will bring in during a given month."

The full survey results are available from LendingTree's 2026 side hustle income survey.