Thomas Sowell’s excellent books on the subject of economics discuss this phenomenon in length.
I find it interesting, because this phenomenon described in this graph demonstrates reality as it should be, and is.
As people enter the workforce, they often have little real experience or little real skill in a given area, so consequently, their income will not be great. It is one of the wonderful mechanisms of capitalism that as people develop skills and acquire education and experience in a given field, their value increases (if, of course they are in the correct field) and their income increases as they age.
It is one of the most wretched and irritating aspects of the minimum wage acolytes that they see this as somehow an unfair discrimination against people working in low income jobs.
If one takes the time to look at the situation, most low-paying jobs are not meant to have people stay in them for their entire career, or to try and support a family off of them. Those low-paying jobs should be portals for people to be able to gain experience and “personal capital” that will enable them to make a jump upwards.
That mechanism works both for employees and the employer, as it rewards those who are willing to work hard to get ahead, and rewards the employer by providing them with experienced workers who have the necessary skills and talents to execute a job or service.
Liberals completely don’t get this. They view this income disparity as being unfair. When you come right down to it, this particular difference in outlook, in particular, may be one of the reasons that industry is tanking in this country.
This applies to all except those that have been duped, manipulated or deceived to perceive themselves as victims.
The downward elbow in the 50 to 60 age range isn’t because employers lower salaries on older workers to match output. They terminate them, which leads to an unfortunate loss of institutional knowledge. It’s too bad there’s not a better way to handle the pay to output discrepancy of the wiser workers.