According to the Urban Institute, roughly a quarter of American families suffer a major disruption to their income each year, with nearly one in five facing an income drop of 50 percent or more. And according to Pew Charitable Trusts, more than a third of households experienced large year-over-year changes in income from 2014 to 2015. Households with losses saw their incomes decline by an average of 49 percent. And fewer than half of Americans said they have consistent and predictable household bills and income month to month. Columbia isn’t an exception to this growing problem of income volatility.
Labor market factors are believed to have the biggest impact on income volatility, and employers, individuals, elected officials, community advocates, schools and many more can all play a role in helping solve the problem.
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As the mayor of this wonderful city — a city that’s at the forefront of innovation across such issues as clean energy and increasing access to healthy slow foods — I wanted to ensure we were at the forefront on income volatility. That’s why last month, Columbia hosted the first-ever Finance Forward event in coordination with The Aspen Institute Financial Security Program and financial technology startup LendUp. The events brought together elected officials, local businesses, community advocates and nonprofit leaders with the goal of identifying and advancing actionable solutions.
Income volatility doesn’t just hurt those who experience it. Families facing income volatility are also significantly more likely to be evicted, receive public benefits and miss housing and utility payments. When utilities are city-owned, city revenues suffer.
Tackling a challenge this far-reaching requires us to get a fully informed, on-the-ground understanding of how it impacts real people in our community. And it demands a movement with new ideas from groups who have studied the issue as well as community members, leaders and employers who know our city, and companies that can help us build local solutions .
Our residents have unfortunately felt the sting of persistent income volatility. I’m confident that through this program, we can play a role in developing solid solutions, both for our residents and for other communities facing similar challenges.
Mayor Steve Benjamin