Patching It Together: The Impact of Multiple Job Holding on Household Poverty

Background. Low-skilled workers in the U.S. face low wages and often struggle to secure sufficient work hours. For middle-skilled workers, substantial loss of jobs at this skill level in recent decades has led to increased competition and lower wages. When faced with constrained employment opportunities and low wages individuals and families rely on different strategies to make ends meet. One less frequently discussed strategy is the choice to moonlight—to work a second job. Recent data show that about 5% of the U.S. employed population holds more than one job and that lower-wage workers are more likely to work multiple jobs. Labor supply theory suggests two possible motivations for this choice. One, individuals may work a second job if hours constraints on the first lead to insufficient income. Two, a second job may offer non-wage benefits that the primary job lacks, such as work hours that are more flexible or a better fit with non-work responsibilities. For low- and middle-skilled workers, both of these motivations likely ring true. The ability to supplement earnings with a second job, or reduction in costs like childcare due the added flexibility of two part-time jobs over one full-time job could both translate to increased family income. This raises the question of how, and to what extent, multiple job holding contributes to the economic wellbeing of low- and middle-skilled households? Are there differences by cultural or educational group?

Methods. We examine these questions by exploring the relationship between multiple job holding and risk of poverty among a national sample of households with low- and middle-skilled workers. Data are from the 2001 through 2008 panels of the Survey of Income and Program Participation. The study sample includes all households where no member has educational attainment above some college (N=97,679). We calculate poverty rates before and after mechanically removing earnings from the second job, a method commonly used to assess the impact of an income source on overall economic wellbeing. Subgroup analyses by household structure, immigrant status, race and ethnicity, level of education, and recessionary/expansionary periods provide insights into how the impact of multiple job holding on economic wellbeing varies for different groups and by macroeconomic context.

Results. Preliminary analyses suggest that multiple job holding can translate into a life further away from poverty. Earnings from a second job reduce poverty rates significantly, with the largest positive effects among black and Hispanic households, households with lower levels of educational attainment, and very low-income households.

Implications. Findings have implications for a wide variety of policy areas. Strong effects on household poverty suggest multiple job holding also shapes eligibility and benefit levels for means-tests programs including SNAP, TANF and the EITC. Additionally, an individual’s ability to maintain and benefit from multiple job holding is contingent on the design of policies that shape the work lives of low- and middle-skilled workers, such as childcare subsidies, regulations on work hours and overtime, and unemployment insurance. The authors will discuss implications of study findings for these policy areas and for future research.