Americans will need sizable raises to maintain their buying power in the new year.
It’s common practice for companies to give out raises that allow workers to maintain their buying power in the face of rising living costs. Normally, a 2% to 3% raise serves this purpose. But in light of recent levels of inflation, employers will need to do better than that.
Initial data shows they plan to. The average salary is expected to rise by 3.9% in 2022, according to data from The Conference Board. But that may not be enough to keep up with inflation if it continues at its current pace.
Why the wage generosity?
It’s not just inflation that may be driving employers to give out larger raises than usual in 2022. Many industries are struggling to hire, and a good way to address labor shortages is to entice workers with higher wages.
But still, inflation is a big driver of projected wage growth, with 39% of employers pointing to it as a reason for generous raises in 2022. That said, it’s worth noting that in October, the Consumer Price Index, a measure of the cost of consumer goods, rose 6.2% from the previous year. That means a 3.9% won’t cut it in allowing workers to keep up with rising expenses.
Snagging an even better raise
You may be in line for a 3.9% raise in the new year, but if your living costs have risen beyond that point, that’s not something to be thrilled about. If that’s the case, you can score yourself an even bigger raise by getting a side hustle on top of your main job.
These days, there are numerous gigs you can sign up for that allow you to boost your income without having to commit to a rigid schedule. You could become a weekend dog-walker, babysit on the evenings you’re free, or house-sit during the week. You could also sign up to drive for a ride-hailing company and shuttle people around town when it’s convenient for you.
There are also plenty of side hustles that don’t even require you to leave the house. If you have the skills, you can pick up web design work, do bookkeeping for small businesses, or write or edit web content. Or, you could turn a hobby you love into a side hustle, like designing jewelry and selling it at craft fairs or online.
Not only might a side hustle provide the income boost you need to keep up with your bills, but it might also allow you to secure your finances for the long haul. That’s because any extra earnings you don’t need for near-term …….