mauldineconomics.com / BY SAMUEL RINES / OCTOBER 13, 2016
The US economy has slowed, and the reasons for the sluggish growth cause heated arguments among market participants and economists alike. There are two outspoken camps: “the good ole days are coming back” and “this is normal.” The camps have little in common, except yelling at one another.
Good Ole Days
Regardless of whether or not the good ole days will return, they are a long way off. There are a number of reasons for this, but as this recent paper pointed out, demographics are destiny. Sure, Millennials could create a baby boom, but it’s doubtful. Even if they were up to the task, it would take decades for the effects to trickle through the US economy.
Everyone loves to harp on Millennials. But their predecessors had a few key demographic traits handed to them that boosted economic growth. The Boomer generation had the benefit of astounding population growth and labor force gains. As women joined the labor force in greater and greater numbers, the growth accelerated the Boomer boost. All of this made an unrepeatable economy to grow and thrive in.