12/30/2023 0 Comments Kid tables without proposition 65![]() population is the Social Security area population, comprising residents of the 50 states and the District of Columbia (adjusted for net census undercount) civilian residents of Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands federal civilian employees and persons in the armed forces abroad and their dependents crew members of merchant vessels and all other U.S. NOTE: For the purpose of this table, the U.S. SOURCE: Board of Trustees (2006, Table V.A2) and authors' calculations. population, by age, selected years 1950–2080 Year At the same time, the working-age population will have shrunk, from 60 percent in 2005 to 54 percent in 2080. The elderly population will have more than doubled as a percentage of the total population in just over 100 years. That share was 12 percent in 2005 and is projected to reach 23 percent by 2080. In 1950, 8 percent of the total population was aged 65 or older. Table 1 shows how the elderly population has increased over time and how it is projected to grow in the future. ![]() BackgroundĪs in many countries, the population in the United States is graying. It first provides context for the policy discussion by examining fertility, mortality, work, and retirement patterns in the United States and then discusses different policy options. This article describes policy implications and some potential policy solutions to this demographic challenge. With each passing year, fewer workers are paying ever-higher benefits to an ever-larger number of retirees. And over the next few decades that number will fall to just two workers per beneficiary. And instead of sixteen workers paying in for every beneficiary, right now it's only about three workers. And those benefits are scheduled to rise dramatically over the next few decades. President Bush, in his 2005 State of the Union Address (White House 2005), highlighted this problem, saying: In today's world, people are living longer and, therefore, drawing benefits longer. This demographic challenge has been recognized by policy analysts as well as policymakers. ![]() population and a subsequent strain on the Social Security system. Together these factors result in the aging of the U.S. IntroductionĪmericans are living longer and are having fewer children. Other proposals that could promote more work at older ages include expanding phased retirement options and reforming pension and defined contribution systems to create incentives to work and save. This could possibly hurt individuals who need to retire from physically demanding jobs but would ensure that people receive higher benefit amounts once they were able to fully retire. One proposal to encourage continued work would be to increase the early eligibility age for Social Security benefits from age 62 to age 65. Since individuals will be living longer in retirement, many policymakers believe it is important to encourage older workers to delay retirement so that they can maintain a quality standard of living throughout their retirement. Still other options would seek to raise additional revenue for the system. Other options, such as progressive price indexing proposals, explicitly protect the retirement benefits of low lifetime earners. However, these reductions in benefits have the potential to harm economically vulnerable retirees. One policy option that could help keep the Social Security system solvent is to reduce retirement benefits, either by raising the normal retirement age or through life expectancy indexing, to reflect the fact that people are living longer. This presents a significant challenge to policymakers. Consequently, the Social Security system is experiencing a declining worker-to-beneficiary ratio, which will fall from 3.3 in 2005 to 2.1 in 2040 (the year in which the Social Security trust fund is projected to be exhausted). At the same time, the working-age population is shrinking from 60 percent today to a projected 54 percent in 2080. Today 12 percent of the total population is aged 65 or older, but by 2080, it will be 23 percent. ![]() Declining fertility rates and increasing life expectancies are causing the U.S. Social Security system will face financial challenges in the near future. Summaryĭue to demographic changes, the U.S. The findings and conclusions presented in the Bulletin are those of the authors and do not necessarily represent the views of the Social Security Administration. The authors are with the Office of Retirement Policy, Office of Policy, Social Security Administration. ![]()
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