This post looks at the population 45 – 54 and how it changes over time, and whether that can explain some of the patterns in real median income we observe in Presidential administrations since Ike. Why population 45 – 54? Well, according to the Census, that’s the income group making the most money. Thus, if demographics are the explanation for the extremely fast increase in real median income during the JFK/LBJ and Clinton administrations noted in my post on real median income, presumably we’d expect to see much more of these prime-earning folks wandering around during those administrations than at other points. Similarly, given the drops in real median observed during the Carter, GHW, Nixon/Ford, and GW administrations, we’d expect to see a lower percentage of these high earning folks during those administrations. Of course, that’s all a big if.
So here’s what the prime earning population as a percentage of the total population looks like over time.
Here’s a summary…
Well… Clinton did have a fastest growth rate in the high earning folks… so maybe some of his real median income performance is due to that. But he was followed by the Bush boys when it comes to growth rate in that prime earning demographic… and both were underperformers when it comes to real median income growth… and just about everything else we’ve looked at so far. JFK/LBJ, who posted the fasted growth rates in real median income, and Reagan, who followed JFK/LBJ and Clinton, both had decreases in this prime demographic.
It makes it hard to conclude that demographics are what’s driving the difference in performance we observed in real median income. A bit more formally…
And now a graph.
So… is the excellent performance on real median income growth in the JFK/LBJ, Clinton, and to a lesser extent Reagan years explained by a veritable plethora of the prime demographic? Not much. Some of the dismal performance of Carter and Nixon/Ford might be due to a decrease in this prime demographic, but the Bush boys don’t even have that excuse. And if we look at real disposable income less the increase in a person’s share of the national debt, this demographic excuse gets even more shredded…
Conclusion… while real median income is affected a bit by demographics, its effect seems to be at the margin… when demographic conditions are abysmal, real median income growth rate is abysmal. But the performance of most Presidents doesn’t seem explainable by demographics.
Correction. Originally had the wrong graph 1. Error pointed out by One Salient Oversight.