The last post attempted to answer the question, does it matter who the president is for the purpose of determining national economic performance (growth)? The answer was, at least statistically speaking, no, probably not.
But does the president get the blame for a poorly performing economy (and high regard for a strongly performing one)?
In this investigation, I gathered and aggregated data on national unemployment rate and presidential approval rating by quarter, from 1977Q1 to 2016Q2. This time, I selected unemployment rate as the economic performance metric because the availability of jobs and hiring conditions is probably the most directly related to how the average Joe feels about the state of the economy (more so than inflation, GDP, etc).
The below graphs are scatter plots for each of the six presidencies from Carter to Obama of average quarterly presidential approval rating against average quarterly civilian unemployment rate. Each dot on the graph represents one quarter during that president's term.
Conclusions and Interpretations:
When the economy was the main theme of a particular presidency, the poll numbers showed that Americans' satisfaction with the sitting president was strongly correlated with how the economy was performing.
There are three presidencies (Reagan, Bush Sr, Clinton) where the unemployment rate was highly negatively correlated with approval rating - that is, the president's approval rating was higher when unemployment was low, and vice versa. Logically, this is what one might expect. These are strong correlations, as seen from the p-value on the right hand side of the above table, which tells us the probability of the observed values if the null hypothesis were true (i.e. if there were actually no correlation between the two variables whatsoever). All three of these presidencies have p-values under 0.05, indicating that there conclusively is a correlation between approval rating and unemployment at the 5% significance level, and all of the correlations are negative, as shown by the correlation coefficients.
Interestingly, the other three presidencies (Carter, George W. Bush, Obama) showed slightly positive correlations between the two variables. However, one should not conclude that these presidents benefited in terms of popularity from a sinking economy, because these are all weak correlations, and none of them show any conclusive link between the two variables at the 5% significance level. What this suggests is that other factors than unemployment or economic performance played a more significant in determining these presidents' approval ratings.
Here's a brief look at the presidencies on a case-by-case basis:
1) Jimmy Carter (weak positive/no correlation): He came into office with a high approval rating (almost 70%) even though unemployment was about 7% at the time. This has a lot to do with Republicans falling out of favor following Watergate and Richard Nixon's resignation. Carter's approval did surely decline as the economy worsened and inflation skyrocketed. But this effect is not fully apparent from the above data because of his initially high rating and the fact that his presidency lasted only four years.
2) Ronald Reagan (strong negative correlation): The 1980's began with a recession, which was followed by a long period of expansion and prosperity. Reagan left office with a high approval rating, no doubt in large part because of the country's economic growth under his presidency.
3) George H.W. Bush (strong negative correlation): A souring economy in the early 1990's ended up being the dominant factor in driving Bush Sr's approval ratings down, and a key reason for his defeat in the 1992 presidential election.
4) Bill Clinton (strong negative correlation): "The economy, stupid" was the focus of Clinton's presidential campaign in 1992. The strongest correlation of the six presidencies by far (-0.762), Clinton's presidency coincided with a long boom in economic growth and technological innovation. Generally speaking, Americans responded to these good economic times with high regard for their leader, even amidst the clamor of an impeachment.
5) George W. Bush (weak positive/no correlation): Never mind how the economy was doing - the country was widely upset over the state of the wars in Iraq and Afghanistan, and this drowned out the "economy" correlation effect. Of course the 2008 financial crisis didn't help Bush's ratings, but that was already near the end of his term.
6) Barack Obama (weak positive/no correlation): He came in highly popular and with great anticipation in the midst of the economic disaster. Unemployment decreased by half during his time in office. However, it seems that Americans did not give Obama proportionately greater props, as gripes over the president's approach to healthcare reform, partisan deadlock in Congress, and handling of other foreign and domestic issues prevented his approval rating from breaking 50% for most of his two terms.
Data sources:
1, Presidential Approval Rating: The American Presidency Project, University of California, Santa Barbara (http://www.presidency.ucsb.edu/)
2. Unemployment by quarter: Federal Reserve Bank of St. Louis, Civilian Unemployment Rate
(https://fred.stlouisfed.org/)
