It's a more socially acceptable version of "shit happens".
It can be used to:
1)express condolences for someone's situation without offering any apologetic
words.
2)respond to a
future problems that shows a sense of
sadness/aggression towards it, but in a way without trying to complain
3)to shrug off a one's own, or someone else's, minor annoyance
4)substitute for an actual response, while still continuing the conversation
1)"My
girlfriend just broke up with me"
It happens.
2)"I'm not looking forward to this
physics test tomorrow"
It happens.
3)"I think the cafeteria is out of milk. (
Ehh, it happens)"
It happens.
4)"Sounds like you've had a long day"
Yeah, it happens.