More than one-third of American households experience income volatility in a year's time, according to Pew Charitable Trusts' 2015 Survey of American Family Finances. Pew defines volatility as a year-over-year change in annual household income of at least 25 percent. Here are the percentages who experienced volatility by generation...
Households with at least a 25% change in income, 2014-15 (and % gaining or losing)
Millennials: 43% (26% gain; 17% loss)
Gen Xers: 31% (18% gain; 13% loss)
Boomers: 31% (15% gain; 16% loss)
Silent: 31% (15% gain; 16% loss)
Income volatility is a hardship says Pew, and survey findings bear this out. The 34 percent of households experiencing income volatility between 2014 and 2015 were more likely than those with stable incomes to have experienced financial shortfalls in the past year. They were less likely to have savings or the ability to come up with $2,000 to pay for unexpected expenses. Households with a financial loss of 25 percent or more had median savings of just $1,550. Those with a financial gain of 25 percent or more had savings of $3,000. Those with stable incomes had median savings of $5,500.
The most commonly cited reason for income volatility is an irregular work schedule, says Pew.
Source: The Pew Charitable Trusts, How Income Volatility Interacts with American Families' Financial Security