Department of Finance Canada

• 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.
• 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.
• Given the current state of the economy and governmental policy, it’s unsurprising that so many are lured by the appeal of passive income.

Earning while you sleep

• 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.

• 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.

Always be grinding

• The idea of passive income is often glamorized, but the reality is that many of these ventures require significant effort.
• 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.

• Some of it is surely good old-fashioned aspirational content and marketing, as journalist Rebecca Jennings wrote in a March 2023 article for Vox.
• 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.

A new gilded age?

• Only 20 per cent of Americans make passive income, and almost entirely via dividends, interest or rental properties (although whether rental properties count as truly passive income is still up for debate).
• Canadian numbers are harder to come by, but Finance Canada estimated 83 per cent of taxable passive income was held by individuals in the top one per cent income range in 2017.
• Nevertheless, in a new gilded age defined and structured by wealth that is passively inherited or transferred and rarely distributed, the rest of us can’t help but take notice of a platform economy waiting to be exploited — and why not?

Jake Pitre received funding from the Mitacs Globalink Research Award for portions of this research.