To build trust and unlock innovation, support your employees’ side hustles

When our head recruiter speaks to a promising candidate, she asks about qualifications and what they seek in a team culture. If things are going well, she’ll ask this: “So, do you have a side hustle?” No, it’s not a trick question but part of our recruitment and retention strategy. 

Today, one in three working Americans has a part-time job along with their full-time employment, and an additional 24 percent hope to pursue a side hustle in the near future. While there is growing support of “side hustles” or “moonlighting” among executives, side hustles are still often treated as an HR nuisance to be managed for fear of reducing productivity or a liability that could expose trade secrets. As a CEO who has now been at the helm of three agencies, my message is this: Embrace the side hustle. Not just because of its inevitable ubiquity, but because it’s good for capital B “Business”—the definition of business that encompasses bottom line, employee mental health, and brand values.

Pre-dating the pandemic, our designers, strategists, editorial talent, and communications specialists have also been professional musicians, consultants, university lecturers, and entrepreneurs on the side. Over the years, employees with side hustles comprise about a quarter of the team. As long as they prioritize team and client meetings, our side hustle policy allows them the flexibility to engage in outside work during the nine-to-five hours. And with managerial approval, they are able to go on part-time, temporary leave to pursue their side hustle. 

At the center of this policy is trust. Trust that employees know what they need to have full lives and will do their best at work on their own schedule. With this policy in place, our organization has experienced higher retention rates among employees with side hustles and year-over-year growth that outpaces industry standards. In our internal employee engagement survey, 92 percent agreed that the organization supports them pursuing alternative pathways to growth outside of their discipline, and 100 percent of respondents said their talents and contributions are valued and respected. 

Recent research by the Academy of Management found that side hustles were more likely to enrich full-time work performance and improve psychological well-being on the job than create conflict with full-time work. The study connected the psychological and performance boost to fulfilling deeper motivations including prestige, financial stability, social connection, full project ownership, and experiencing new tasks. In satisfying these needs, side hustles can serve to energize and open neural pathways that help employees innovate and bring creative solutions to their full-time work. This is particularly important for employees who turn to their side hustle to prevent burnout from the sameness and social isolation of remote work.

For most, the side hustle represents the opportunity to meet needs not fulfilled by work while holding onto all of the opportunities their full-time work does allow. Only 17 percent of study participants reported that they would ever consider taking their side hustle full-time, though I would argue that an employee leaving to pursue their dream is far preferable than resigning because of a work culture issue, burn-out, or for better compensation. As for concerns that side hustles compete with your core offering, this can be remedied through agreements that prohibit sharing proprietary information and trust-based conversations between employees and managers.

Policies that encourage flexibility in how we work and when we work provide an overdue update to our definition of productivity. They reject the rigid notion of “company time” that is often revered in a nine-to-five work model, a dusty relic of the Industrial Revolution factory model. They build trust between employees and employers through the understanding that employees will be measured based on how well they support their teammates and the quality of their work, instead of how desk-bound they are. They allow employees to show up as their whole selves, which has ripple effects for work culture. With recent research showing that people are 10.5 times more likely to resign because of bad workplace culture than compensation, pro-side hustle policies can support a culture of trust and autonomy that serves everyone. 

In a PwC survey of C-suite executives, 77 percent of executives say hiring and retaining talent is their most critical growth driver in 2022. But typical levers like hybrid work opportunities, compensation, and benefits are becoming less of a differentiator in the industry as most employers must improve in these foundational ways. While pro-side hustle policies are just a piece of the puzzle, they certainly can bring companies closer to creating a work culture that emphasizes trust, autonomy, and balance.