What economic powerhouse pulled the economy out of recession last year and is keeping it afloat this year by continued spending? The answer, according to several new studies, is: The Baby Boom Generation, the 78 million Americans born in the two decades after World War II.
They range in age today from their late 30s to their late 50s, and there are so many of them that, statistically, another baby boomer turns 50 every 7.5 seconds.
In short, says economist Lynn Franco of the Conference Board, a business research group, this enormous population segment is in its prime earning years and the economic effects are impressive.
"The Baby Boom Generation, because of their affluence and their size, have managed to keep spending at a pace that really has helped the economy," she said. "So we have just had earning realization help boost spending and thereby help boost the economy through this mild recession."
It is more than a question of population size, Ms. Franco says. The Baby Boomers were born during more prosperous times than any prior generation. They have, throughout their lives, been more accustomed than prior generations to spending money on themselves.
They are better educated than prior generations. They have married later and had fewer children.
"Family size has a lot to do with spending patterns. We have seen a lot of change in the workforce with women going to work, getting college educations," says Ms. Franco. "We have had dual earner households. This has helped give this generation more discretionary income and spending power than prior generations."
As a sign of that spending power, Walter Malony of the National Association of Realtors points to the escalating market for vacation property.
"The Baby Boom generation is entering the prime years for buying a second home and this has resulted in a market that is so hot, there are actually shortages of properties available for sale," he said.
These affluent middle-aged households will continue growing rapidly, Lynn Franco says, accounting for 40 percent of all households by the end of this decade.
But then, she says, the baby boom generation will begin to have a very different impact. "As we move beyond 2010 and we see more and more boomers retire, then I think we may see more negative implications in terms of health expenditures," she explains.
Then the big spenders could become an enormous economic drain as their earnings deplete and their needs grow. Hopefully, Lynn Franco says, the nation's biggest, more affluent demographic group is putting a little money aside today for its later years.