Demographics in Pictures: Peak Earning (and Peak Spending Years)

Here is a nice theme from reader "BC" regarding peak earning years that I merged into a single chart.

Peak Earning Years



click on chart for sharper image

The above chart shows what is happening to employment in age groups 35-44 (blue), 45-54 (red), and the combined effect 35-54 (green).

Those in age group 35-54 are in their peak earning and spending years. This is the period where people upgrade houses and have a need for larger cars as family sizes grow. Between 34-44 family sizes reach peak. Expenses hit maximum when kids graduate from high school and head to college.

Telling Statistics

1. Employment in age group 35-44 peaked just prior to the 2001 recession.
2. Employment in age group 45-54 peaked right at the start of the 2007 recession.
3. Employment in age group 34-54 peaked just after the housing bubble burst.

Earning power for boomers has peaked. Yet as a whole, boomers are unprepared for retirement.
The effect on spending and GDP should not be hard to figure out.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.