You might have a side hustle. That is, you might have a job you do when you’re not doing your other job. You probably do the side hustle for two more or less equally important reasons. It’s something you like. Also, you want to add to your income since your first job doesn’t pay as much as you want.
The gig economy, which allows people to take on a side hustle more easily, is symbolized by a big name, Uber, although there are many others, such as Amazon Flex (freelance delivery) or Bellhops (helping with moves).
If you’re trying to maximize your earnings you might assume that checking for the highest payment per hour or per task is the best way to choose a side hustle. Actually, belonging to a robust network is the best predictor for maximizing your earnings from a side hustle. The best way to maximize your earnings is to join, establish, or extend a network.
The best way to understand this principle is to go back to the conventional ways people have had for earning income. One is the market, and the other is a bureaucracy. In a market, price is used to negotiate how much you’ll be paid. In other words, you compete with other people who also bid on the opportunity to work. An example would be a tender process, in which you and others propose how much you’ll charge to do a job. Another transaction of this kind is selling a used car on Craig’s List. In both cases, best price wins.
In a bureaucracy, price isn’t the final arbiter for negotations. With a bureaucracy, which most companies and public organizations use, you sign up to be an employee and accept the pay that the employer offers you and othe remployees for a period of time. In this arrangement, relative financial security for both you and the employer are used to negotiate how much you’ll be paid. The employer wants the security of knowing that people will show up for work each day and follow the company’s rules, policies, and expectations. In effect, you exchange the disadvantage of less pay than you could make in the market for the advantage of the security of not having to find a new job everyday.
Your side hustle can have the benefits of both the market and bureaucracy if it finds a kind of in-between position. This in-between position is a network. Belonging to a network means that you are exchanging information, insights, and skills with other workers and with potential employers. As a member of a network you can gain an edge in finding where the next job might be. The network can also sharpen the information, insights, and skills you have, because of the relationships you have through the network.
You can negotiate a better price for your work because of the knowledge you have as a consequence of being part of the network. And you may be able to move more quickly from one job to another over time and to maximize your earnings as a result.
A network is going to help most often with non-gig “platforms” (the Ubers of the world), because platforms don’t negotiate their price. Instead, you want to develop a network for the purpose of offering your services to individuals, groups, and companies that are ablet to recognize and reward you financially for what you bring as a member of a network.
An example? Let’s say you’re good at an enjoy refinishing wooden furniture such as tables and chairs. You could create an online network of people who want that service and people who offer similar services. You could kick off activity in the network by exchanging information about current trends in the area, such as what finishes and colors are becoming popular. The network could begin to circulate more and more information and insights, while you and other providers in the network showcase your skills by posing photographs of your best work.
It’s important to remember that members of a network exchange benefits and risks. Sometimes you have may want to recommend someone else for a job because they have a bit more relevant knowledge than you - the exchange will be that next time, that person will recommend you for another job.
The result of being part of a dynamic network of this kind? Over time, it will reward your efforts.
Photo by Kat Northern Lights Man from the Torontoist Flickr Pool.