Side Hustles During Unemployment: Earn Income While Job Searching

When you're laid off, the financial pressure is real. While finding your next full-time role should be priority one, there are legitimate ways to bring in income without derailing your job search. This guide covers practical side hustle options, how they affect your unemployment benefits, and strategies to balance earning with job hunting.

Before You Start: Unemployment Benefits Considerations

This is critical: side hustle income may affect your unemployment benefits.

How Earnings Affect Unemployment

Every state handles this differently, but generally:

Reporting requirements:

• You MUST report all income earned while collecting unemployment
• Failure to report can result in penalties and repayment requirements
• Even small amounts must be reported

How benefits are calculated: Most states use one of these methods:

• Dollar-for-dollar reduction: Every dollar earned reduces benefits by a dollar
• Partial reduction: You keep some earnings before benefits are reduced (often 25-50% of your benefit amount)
• Earnings disregard: Some states have a threshold where small earnings don't affect benefits

Check Your State's Rules

Before starting any side hustle:

1. Visit your state unemployment website
2. Look for "working while receiving benefits" or "partial unemployment"
3. Understand reporting requirements and deadlines
4. Calculate whether the work is worth it financially

The Math May Still Work

Even with reduced benefits, working can make sense:

• Keeps skills sharp and resume current
• Builds network connections
• Maintains work routine and mental health
• Income from side hustles may exceed what you'd lose in benefits
• Some work doesn't require benefit reduction (varies by state)

Quick Income: Gig Economy Options

These offer flexibility and quick payment—ideal when you need income fast.

Delivery and Driving

Food delivery:

• DoorDash, Uber Eats, Grubhub, Instacart
• Work whenever you want
• Earnings: $15-25/hour typically (varies by market)
• Requirements: Car, valid license, insurance, smartphone

Rideshare:

• Uber, Lyft
• Generally pays better than food delivery
• Earnings: $18-30/hour typically
• Requirements: Newer car (usually < 10 years old), clean driving record

Package delivery:

• Amazon Flex
• Scheduled delivery blocks
• Earnings: $18-25/hour
• Requirements: Car, smartphone, ability to lift packages

Pros:

• Start earning within days of signing up
• Complete flexibility on schedule
• No boss or office politics
• Pay out weekly or faster

Cons:

• Vehicle wear and tear
• Gas costs reduce profits
• No benefits
• Income is unpredictable
• Self-employment taxes

Task-Based Platforms

TaskRabbit:

• Furniture assembly, moving help, handyman work, cleaning
• Set your own rates
• Earnings: $20-50+/hour depending on skill
• Best for: Handy people, those with tools

Handy:

• Cleaning and handyman services
• Platform sets rates but provides steady bookings
• Earnings: $20-45/hour

Thumbtack:

• Various services from photography to home improvement
• You bid on jobs
• More professional services focus

Pet Services

Rover and Wag:

• Dog walking, pet sitting, boarding
• Great for animal lovers
• Earnings: $15-30/walk, $25-75/night for boarding
• Requirements: Love animals, reliable schedule

Pros:

• Fun, low-stress work
• Build regular clients for recurring income
• Flexible scheduling

Cons:

• Liability concerns
• Need to be comfortable with animals
• Income can be seasonal

Leveraging Your Professional Skills

Your career skills are valuable—don't give them away for free while job searching.

Freelance Consulting

If you have specialized expertise, consulting can be lucrative:

Where to find clients:

• Reach out to former contacts
• LinkedIn ProFinder
• Toptal (for tech professionals)
• Catalant (for business consultants)
• Your professional network

Setting rates:

• Calculate your hourly rate from your previous salary
• Multiply by 1.5-2x to account for lack of benefits and taxes
• Consider project-based pricing

Common consulting areas:

• Marketing strategy
• Financial modeling
• Operations improvement
• Technology implementation
• HR and recruiting
• Legal/compliance

Pros:

• High hourly rates
• Maintains professional skills
• Potential for full-time conversion
• Builds network

Cons:

• Inconsistent work
• Business development takes time
• May need professional liability insurance

Fractional or Part-Time Professional Work

Some companies need experienced professionals but can't afford (or don't need) full-time:

Fractional executive roles:

• Fractional CFO, CMO, CTO
• Work 1-2 days per week
• Through networks or platforms like Chief Outsiders

Part-time professional work:

• Contract roles at startups
• Project-based work at agencies
• Interim positions

Pros:

• Maintains high-level work on resume
• Good pay
• May convert to full-time

Cons:

• Can be hard to find
• May conflict with full-time job search

Freelance Writing and Content

If you can write clearly, there's demand:

Content writing:

• Blog posts, articles, website copy
• Platforms: Contently, Skyword, ClearVoice
• Earnings: $0.10-$1+/word depending on expertise and client

Copywriting:

• Marketing emails, ads, sales pages
• Generally higher paying than content writing
• Requires specific skills

Technical writing:

• Documentation, manuals, guides
• If you have technical expertise, this pays well
• Platforms: WriterAccess, Scripted

Where to find work:

• Upwork (competitive but lots of opportunities)
• LinkedIn (many companies post contract work)
• Industry job boards
• Direct outreach to companies

Teaching and Tutoring

Your expertise has educational value:

Online tutoring:

• Wyzant, Tutor.com, Chegg
• Academic subjects or test prep
• Earnings: $20-80/hour depending on subject

Professional teaching:

• Guest lectures at universities
• Corporate training
• Workshop facilitation

Online course creation:

• Create courses on Udemy, Skillshare, Teachable
• Passive income potential
• Requires upfront time investment

Pros:

• Flexible scheduling
• Personally rewarding
• Can lead to other opportunities

Cons:

• May require certifications
• Inconsistent demand
• Some platforms take large cuts

Selling Products and Services

Online Reselling

Turn stuff you own (or buy cheaply) into cash:

Platforms:

• eBay for most items
• Poshmark, ThredUp, Mercari for clothing
• Facebook Marketplace for local sales
• Amazon (for retail arbitrage)

What sells well:

• Name-brand clothing and accessories
• Electronics
• Collectibles
• Furniture (locally)
• Books (textbooks especially)

Getting started:

• Start with items you already own
• Graduate to thrift store/garage sale finds
• Consider specializing in what you know

Pros:

• Low startup cost
• Flexible timing
• Can clear out clutter while earning

Cons:

• Time-intensive per dollar earned
• Shipping hassles
• Income is unpredictable

Freelance Design, Development, or Creative Work

If you have creative or technical skills:

Graphic design:

• Logos, marketing materials, social media graphics
• 99designs, DesignCrowd, or direct clients
• Earnings: $25-100+/hour

Web development:

• Website creation, updates, maintenance
• Upwork, Toptal, Codementor
• Earnings: $50-150+/hour for experienced developers

Photography and video:

• Events, portraits, product photography
• Stock photography (passive income)
• Video editing

Pros:

• Often high-paying
• Portfolio building
• Skills stay current

Cons:

• Competitive markets
• Need to self-market
• Can be time-intensive

Balancing Side Hustles with Job Search

The key tension: you need income, but your primary job is finding a job.

Time Allocation

Recommended split (while job searching):

• 70-80% of productive hours: Job search activities
• 20-30% of productive hours: Side hustle

What this looks like:

• Mornings: Job search (applications, networking, research)
• Afternoons/evenings: Side hustle work
• Or: 4 days job searching, 2-3 days side hustle

Setting Boundaries

Protect your job search time:

• Don't let side hustle creep into prime job search hours
• Keep interview days completely free
• Maintain energy for networking and applications

Be strategic about commitments:

• Avoid ongoing obligations that conflict with interviews
• Choose flexible options that can scale up or down
• Have a plan to wind down when you accept a full-time role

Using Side Hustles Strategically

Skills alignment:

• Choose side work that builds skills for your target role
• Freelancing in your field keeps experience current

Network building:

• Consulting can lead to full-time opportunities
• Clients become references
• Every interaction is potential networking

Resume gaps:

• Freelance work shows you were productive during unemployment
• "Independent Consultant" looks better than unexplained gap

Tax Considerations

Side hustle income is taxable—plan ahead.

Self-Employment Basics

You're responsible for:

• Income tax on all earnings
• Self-employment tax (15.3% for Social Security and Medicare)
• Quarterly estimated tax payments if you earn enough

Deductions to Track

Common deductible expenses:

• Mileage for deliveries (keep a log!)
• Home office expenses
• Software and tools
• Phone/internet (business portion)
• Professional development
• Health insurance premiums (if not otherwise covered)

Record Keeping

Track everything:

• Keep receipts for all business expenses
• Use apps like Everlect, QuickBooks Self-Employed, or spreadsheets
• Separate business and personal banking if possible

Getting Help

Consider consulting a tax professional:

• Especially if this is new to you
• Can help maximize deductions
• Avoid costly mistakes

Avoiding Scams

The desperation of unemployment makes people vulnerable. Stay alert.

Red Flags

Classic scam warning signs:

• Upfront payment required
• Too-good-to-be-true earnings claims
• Vague job descriptions
• Requests for personal financial information
• Check cashing or money transfer requests
• Unsolicited offers via email or DM

Legitimate vs. Sketchy

Legitimate opportunities:

• Established platforms (Uber, DoorDash, Upwork, etc.)
• Direct work for known clients
• Clear payment terms and timing
• Realistic earnings expectations

Avoid:

• MLMs and "network marketing" that require buying inventory
• Data entry jobs that seem too easy
• Reshipping schemes
• Anything involving cryptocurrency "investments"

If It Sounds Too Good...

Reality check questions:

• Would a reasonable business pay this much for this work?
• Why are they reaching out to me specifically?
• Can I verify this company exists?
• Does this involve my personal banking information?

Side Hustle Ideas by Skill Set

Administrative/Office Background

• Virtual assistant work
• Data entry (legitimate sources)
• Bookkeeping for small businesses
• Customer service (remote)
• Transcription

Technical Background

• Freelance development
• IT support/consulting
• Technical writing
• QA testing
• Data analysis projects

Creative Background

• Freelance design
• Photography
• Video editing
• Social media management
• Content writing

Sales/Marketing Background

• Consulting
• Copywriting
• Lead generation
• Affiliate marketing
• Social media management

Service Industry Background

• Delivery driving
• Task-based work
• Pet services
• Event staffing
• Personal shopping

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Key Takeaways

1. Check unemployment rules first — Know how earnings affect your benefits before starting
2. Prioritize job search — Side hustles should supplement, not replace, your search efforts
3. Leverage your skills — Professional freelancing often pays better than generic gig work
4. Be strategic — Choose side work that builds relevant skills and network
5. Track everything — For taxes, unemployment reporting, and financial planning
6. Avoid scams — If it sounds too good to be true, it is
7. Stay flexible — Be ready to reduce side work when interviews pick up
8. Plan for taxes — Self-employment income is taxable; set money aside

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Related Resources:

• Emergency Budget Planning →
• Filing for Unemployment →
• Freelancing After Layoff →
• Starting a Business →
• Emergency Fund Calculator →