The full version of this article appears on May2015.com.
Ever since James Carville trotted out his now overused phrase – “It’s the economy, stupid!” – to explain what matters in presidential races, political pundits have looked to GDP to predict elections.
Earlier this summer we looked at how the coalition’s (and George Osborne’s) economic approval rating had recovered since spring 2013. GDP growth had finally started to consistently tick up after more than two years of spluttering growth.
While wage were still often falling from month to month, most voters now thought the economy was going in the right direction, and the number of voters feeling the “cost-of-living” had continued to drop after peaking in 2011.
We ran a simple model to show how the data suggested that the coalition’s economic approval will be minus 30 per cent if quarterly GDP growth is zero, and then improves by 24 per cent for every percentage point of growth above zero.
Earlier this summer we suggested GDP growth needs to be around 1.3 per cent for voters to be supportive of the coalition.
In other words, for voters to be supportive of the coalition’s economic plan, quarterly GDP needs to be around 1.3 per cent. There were limits to this – GDP only explained half of the approval rating – but the link was noteworthy.
May2015 has since broken down the past five years of polling by everything from age and gender to class and party ID – we can now explore the coalition’s ratings in more depth.
The graph below, which gathers polls by YouGov, shows how the coalition’s economic approval has moved over the past five years.
Four moments stand out:
- The first ten months after they take office, when their approval rating swings from +20 per cent to -20 per cent;
- A two-year period where it continues to fall as GDP turns negative four times in nine quarters;
- A gradual year-long recovery in their rating that began last spring as quarterly GDP growth consistently neared 1 per cent;
- And a recent six-month lull, with slightly more voters still disapproving than approving.
But there is far more to the data. If you ask the rich part of the electorate – the ABC1 voters, who make up the managerial, professional, and white-collar classes – the coalition now a net positive rating, and has had one since March.
If you ask the less affluent section of society – the C2DE voters who work in primarily manual jobs – the coalition still has a negative rating. Among ABC1s, 5 per cent more voters approve than disapprove; among C2DEs 18 per cent more disapprove.