America’s Dwindling Disposable Income Since 1963, Broken Down by Presidential Terms
Unemployment, inflation, and the cost of living affect American wallets. Nevertheless, it’s sometimes difficult to see how things have changed in the U.S. over the last 60 years. But one thing is certain: There’s been a significant change in how much disposable money Americans have to spend.
Looking as far back as the early 1960s, some economic issues Americans are dealing with today are nothing new. Gas shortages, for example, have occurred multiple times in the past. No matter how American politicians react, crises of all types through the years, from energy to the environment, directly affect the disposable income of Americans.
Nasdaq examined the economic trends under each American president’s term from 1963 to the present. They tracked how individual disposable income has been dwindling, and the numbers are startling.
Tracking America’s Disposable Income
Nasdaq analyzed data from over 60 years of the U.S. economy to determine Americans’ changing disposable income under each president. The data factors in Gross Domestic Product (GDP) growth, unemployment, inflation, and poverty rates.
Compared to other countries, the U.S. has the most disposable income. Luxembourg, Switzerland, and Norway rank right behind us. However, our current standing in the world doesn’t shed light on the bigger picture of how Americans’ disposable income has declined.
Although economic performance has varied under each president, one thing has remained painfully constant: Americans’ disposable income has been decreasing over the years when adjusted for inflation.
Lyndon B. Johnson (1963 – 1969)
- Real disposable income per capita: $17,181
- Disposable income per capita (adjusted for inflation): $130,520
- GDP growth: 2.6%
- Unemployment rate: 3.4%
- Inflation rate: 4.4%
- Poverty rate: 12.80%
Richard Nixon (1969 – 1974)
- Real disposable income per capita: $19,621
- Disposable income per capita (adjusted for inflation): $110,961
- GDP growth: 2.0%
- Unemployment rate: 5.5%
- Inflation rate: 10.9%
- Poverty rate: 12.00%
Gerald Ford (1974 – 1977)
- Real disposable income per capita: $20,780
- Disposable income per capita (adjusted for inflation): $95,602
- GDP growth: 2.8%
- Unemployment rate: 7.5%
- Inflation rate: 5.2%
- Poverty rate: 11.90%
Jimmy Carter (1977 – 1981)
- Real disposable income per capita: $21,891
- Disposable income per capita (adjusted for inflation): $67,143
- GDP growth: 4.6%
- Unemployment rate: 7.4%
- Inflation rate: 11.8%
- Poverty rate: 13.00%
Ronald Reagan (1981 – 1989)
- Real disposable income per capita: $27,080
- Disposable income per capita (adjusted for inflation): $60,887
- GDP growth: 2.1%
- Unemployment rate: 5.4%
- Inflation rate: 4.7%
- Poverty rate: 13.10%
George H. W. Bush (1989 – 1993)
- Real disposable income per capita: $27,990
- Disposable income per capita (adjusted for inflation): $54,005
- GDP growth: 0.7%
- Unemployment rate: 7.3%
- Inflation rate: 3.3%
- Poverty rate: 14.50%
Bill Clinton (1993 – 2001)
- Real disposable income per capita: $34,216
- Disposable income per capita (adjusted for inflation): $53,895
- GDP growth: 0.3%
- Unemployment rate: 4.2%
- Inflation rate: 3.7%
- Poverty rate: 11.30%
George W. Bush (2001 – 2009)
- Real disposable income per capita: $37,814
- Disposable income per capita (adjusted for inflation): $49,141
- GDP growth: -1.2%
- Unemployment rate: 7.8%
- Inflation rate: 0.0%
- Poverty rate: 13.20%
Barack Obama (2009 – 2017)
- Real disposable income per capita: $42,914
- Disposable income per capita (adjusted for inflation): $48,811
- GDP growth: 1.0%
- Unemployment rate: 4.7%
- Inflation rate: 2.5%
- Poverty rate: 14.00%
Donald Trump (2017 – 2021)
- Real disposable income per capita: $48,286
- Disposable income per capita (adjusted for inflation): $48,286
- GDP growth: 2.6%
- Unemployment rate: 6.4%
- Inflation rate: 1.4%
- Poverty rate: 11.90%
Joe Biden (2021 – Present)
- Real disposable income per capita: $46,682
- Disposable income per capita (adjusted for inflation): $46,557
- GDP growth: 2.6%
- Unemployment rate: 3.5%
- Inflation rate: 5.0%
- Poverty rate: 12.80%
Note: Nasdaq calculated Biden’s numbers from 2021 to 2023.
President Johnson’s Economic Legacy
President Lyndon B. Johnson improved the U.S. GDP and lowered the country’s unemployment rate. Johnson’s achievements were spurred by national tragedy, as the then-Vice President took the oath of higher office after President John F. Kennedy’s assassination in 1963.
Before his passing, President Kennedy proposed several programs that could’ve helped the U.S. economy. While not all of Kennedy’s ideas were realized, President Johnson and Congress enacted as many of those plans as possible. During President Johnson’s term, the government launched new programs like Medicare, food stamps, and several education initiatives.
Great Inflation in America
Disposable income fell in the 1960s and 1970s. Confidence in the government fell, too, as the Watergate scandal pressured President Richard Nixon to resign. As a sign of hope, President Jimmy Carter’s term from 1977 to 1981 saw the highest GDP growth of any president since 1963. But his term also suffered from the highest inflation rate during that same time, which was later named The Great Inflation.
The price of oil during Carter’s time was a contributing reason to the country’s inflation rise. An oil embargo in 1973 and the events of the 1979 Iranian Revolution caused an energy crisis that eventually tripled the cost of oil, leading to gas shortages. President Carter was ahead of his time, though, as he had solar panels installed on the roof of The White House to signal the U.S. could handle the crisis without depending on foreign oil.
Pandemic’s Economic Impact
During the presidential administrations of Donald Trump and Joe Biden, several factors affected the steady decrease in disposable income. The biggest impact on the economy in recent years was the COVID-19 pandemic. Twenty-three million Americans lost jobs because of the pandemic in 2020, which caused a recession.
Food and energy prices rose during the pandemic, which led to a rise in inflation. Supply chain problems lasted from 2020 through 2022, negatively affecting the economy. A survey in 2023 found that 72% of businesses were negatively affected by the pandemic.
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