From side hustles to sleeping streams: The truth behind passive income hype
A growing cohort of Tiktok influencers have begun building platforms by promoting passive income to their followers. Thousands of users regularly share their expertise, tips and advice for how their followers can, theoretically, achieve the same level of passive income without lifting a finger.
One influencer claimed to have tried “about every side hustle that exists” before landing on print-on-demand as the most profitable source of passive income, which she says makes her “six figures as a teenager.”
During the COVID-19 pandemic, interest in passive income surged. The passive income subreddit has nearly half a million members and the #passiveincome hashtag on Tiktok has 1.2 million posts and billions of views. In the wake of the pandemic ending, many have lost faith in the labour market, believing it to have reached a point of no return.
Given the current state of the economy and governmental policy, it’s unsurprising that so many are lured by the appeal of passive income. The middle and working classes have seen the same opportunities afforded to their parents and grandparents evaporate, leaving them dreaming of financial stability without the means to achieve it.
Amid unprecedented levels of income inequality, there is a growing recognition among workers of the uncertainty of the labour market and the need to think differently about financial security. But passive income might not be all it’s cracked up to be.
EARNING WHILE YOU SLEEP
According to a 2022 survey, a significant portion of Gen Z get their financial advice from either Tiktok (34 per cent) or Youtube (33 per cent). They see influencers sharing their successes (and very rarely their failures) and are motivated to try their strategies out for themselves.
Various passive income subcultures have emerged, from finance bro hustle gurus to young women peddling money-making credit card schemes to their followers.
Many influencers pushing passive income schemes describe it as a way to “earn while you sleep,” suggesting that once you put in the initial work on a certain generating enterprise, it will essentially make money for you.
As research I conducted with sociologist Karen Gregory has shown, this has been further literalized by livestreamers on platforms like Twitch. These streamers draw in more viewers and attention by livestreaming themselves sleeping, as fans donate money, promote their content and buy emojis or other perks throughout the broadcast.
This signals a desire to be “freed from work,” because “to sleep on stream is to put aside and obscure the preparatory work that goes into it and benefit from the market through complete bodily passivity.” For us, then, these sleep streamers seem to embody the logical endpoint of passive income as the ultimate dream of this moment under digital capitalism.
ALWAYS BE GRINDING
The idea of passive income is often glamorized, but the reality is that many of these ventures require significant effort. In many cases, the work that goes into side hustles or alternative income streams is incredibly laborious, from handling the logistics and costs of dropshipping (the purchasing of cheap goods to re-sell them at a profit) to the creation and selling of online courses about making passive income.
Indeed, the understanding of what passive income is has transformed wildly, from what the Internal Revenue Service describes as “activities in which you don’t materially participate” to re-appropriating terms like “leveraged income” to refer to maintaining Airbnb rental properties as being somehow passive.
While many critics have correctly pointed out the false promises that permeate the financial wisdom within these online subcultures, we must carefully consider the cultural and economic forces underwriting this shift.
Some of it is surely good old-fashioned aspirational content and marketing, as journalist Rebecca Jennings wrote in a March 2023 article for Vox. “In short,” she wrote, “it’s the feeling that our primary aim as people is to make our lives as effective and efficient as possible.” In other words, the “always be grinding” mindset.
As a result, the concept of participating in multiple income streams to protect one’s self from financial vulnerability is re-framed as not only strategic but passive. Sure, you can break up your labour into different entrepreneurial paths, but you can also, ideally, start them up and then let them go without much maintenance. Let the money flow.