What Is Data Annotation: A New Side Hustle To Try

Data annotation isn’t new, but with the rise of AI, it has become a prominent side hustle in the online space. The task? Training AI to work better.

In truth, data annotation has become the new best thing, loved for its accessibility, flexible work model, and low barrier to entry.

It’s no wonder that people from every industry are turning to data annotation!

Want to know more about this lucrative side hustle? Today, I’m covering all you need to know about data annotation, including role overviews, earning expectations, and how to find work in this field.

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What is Data Annotation?

Data annotation covers four main categories:

Text annotation
Image annotation
Audio annotation
Video annotation

And while it may sound unfamiliar, you’ve likely participated in it without even knowing!

Have you ever been asked to pick out all of the fire hydrants in a sequence of photos? Or choose the squares containing stoplights? This is data annotation. Or rather, image annotation.

By picking out those stoplights, you’re teaching AI about object detection. As a formal annotator, you’d take this a step further by drawing “bounding boxes” around those stoplights, then labeling them as such.

Whichever medium you’re working in, your job is to label data so that AI systems can learn from it.

Why is Data Annotation a Great Side Hustle?

Data annotation has become a top side hustle in recent years because it’s highly desirable. AI is progressing quickly and with it, the need for more annotators.

It’s also great for introverts and anyone who prefers remote working environments. All you need is a laptop and a reliable internet connection.

Finally, it’s easy to get involved with this side hustle. With some basic computer skills and a fine attention to detail, you can quickly succeed.

How to Get Started with Data Annotation

Interested in trying data annotation? Follow these steps to streamline your entry.

1. Research Reliable Platforms

First, consider which platforms you’re interested in working with. You have the opportunity to work for various platforms, depending on your desired workload.

Always read reviews through sites like Glassdoor before taking on a new project. Search for keywords like reliable payment, fair compensation, and steady workflow.

Reliable platforms include:

Appen
Lionbridge
Upwork
Amazon MTurk
Scale AI
DataAnnotation.tech
Labelbox
Clickworker
Toloka

2. Complete Training

One of the best parts about data annotation is that it doesn’t require formal training. Instead, you can self-train or receive on-the-job training depending on the company.

Through online tutorials, you’ll learn about labeling standards and how to use industry-specific software.

3. Build Experience

When you’re learning the ropes, only take on what you can handle.

Start with simple annotating tasks while you build experience and credibility. You’ll still earn a reasonable wage while taking on these standard projects.

4. Increase Your Workload

As you improve in both efficiency and skill, you can begin taking on more tasks (and earning more money!).

You can also consider taking on specialty projects in fields you excel in. Platforms will often pay more for annotators with expert knowledge in sciences, coding, and more.

How Much Money Can You Make with Data Annotation?

Data Annotation makes such a great side hustle because the only earning limitation is your time.

Depending on the platform, you’ll likely be paid by the hour or by project.

I recommend seeking platforms that have a higher minimum payment. For example, DataAnnotation.tech pays their contractors a minimum of $20/hour, with higher wages for specialty annotation.

Other companies (like Amazon Mechanical Turk) will pay as little as $2 per task, so ensure you shop around before committing to a single platform.

As you become more efficient in your work, you’ll be able to take on more tasks and improve your earnings.

Pros and Cons of Data Annotation

One question I always ask myself when I explore a new side hustle is – is it worth it? Let’s explore.

Pros of Data Annotation

Flexible schedule – Choose your own hours, only taking on projects when time allows
High demand – There are plenty of companies hiring in this field
Low barrier – It’s easy to get started with data annotation, requiring no formal education or speciality equipment
Building experience – This is a great starting place to begin working with AI tools + you can leverage your experience for future projects
Remote – These roles are fully remote, meaning you can work from anywhere in the world
Quick earning – If you need quick cash, some platforms will pay for your services in as little as a day

Cons of Data Annotation

Repetitive – Some find data annotating repetitive and slightly boring
Low starting pay – Some platforms have extremely low starting rates
Strict guidelines – You have to follow strict guidelines with expert attention to detail
Lack of consistency – There can be a lack of workflow and available projects, depending on competition
Chance for rejected work – Some platforms will withhold payment if projects aren’t satisfactory

With everything, it’s important to weigh the pros and cons of every new side hustle. For some, it’ll definitely be worth your time! But if it’s not for you, there are plenty more side hustle ideas available.

More Side Hustle Options

Not sold on data annotation? Try one of these fun side hustle ideas:

And I have plenty more ideas where that came from! For more ideas, check out my post on Popular Side Hustles to Try in 2025.

Final Thoughts on Data Annotation

If you’re looking for a straightforward side hustle that provides reliable income while working with your schedule, I recommend giving data annotation a try.

There’s plenty of work available, with projects for every time commitment and skill set.

So, what do you think? Is this a side hustle you’d like to try? Let me know your thoughts in the comments below.

What Is Data Annotation: A New Side Hustle To Try

What is Data Annotation?

Why is Data Annotation a Great Side Hustle?