Uncertain Income in Uncertain Times

Source: Brookings Institution

The Income Rollercoaster: Rising Income Volatility and its Implications
By Karen Dynan

Millions of U.S. households have suffered devastating income disruptions as a result of the recent economic downturn. As of late 2009, eight million jobs had been lost to the recession, and one in ten workers was out of work, putting the unemployment rate at its highest level since the early 1980s. Although a variety of indicators suggest that the recession is now over, most analysts foresee a slow and gradual economic recovery and consequently a long, uphill climb back to full employment. Thus, it may be a number of years before the incomes of many families are back to normal. Policymakers have already taken some steps to support these families and stimulate job creation, and they continue to deliberate about what additional steps are still needed.

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