An aging population will challenge the U.S. economy: PBS
The impacts of an aging population that is growing older at a faster rate will likely have serious economic implications on the United States, according to experts and reporting from the Public Broadcasting Service (PBS) NewsHour program.
“As the share of older Americans continues to rise, the need for benefits and assistance from Medicare and Social Security will grow,” the report explained. “And, at the same time, an aging workforce could cause worker shortages in the years to come.”
At least when it comes to the potential impacts on the workforce, the U.S. could have an advantage to positively impact that attribute according to Wendy Edelberg, director of the Hamilton Project at the Brookings Institution and a former chief economist for the Congressional Budget Office.
“I mean, it is absolutely true that we are on track for slower labor force growth, about half the pace of growth than in previous decades, recent decades,” she said on the program. “But we are also a country that is greatly valued by immigrants. There are immigrants from all over the world who desperately want to come to the United States. So we have a very simple way of boosting our population growth, if that becomes a priority for us.”
A lot of the advancing age in the U.S. comes from the baby boomer generation according to Philip Bump, a national columnist for the Washington Post and author of “The Aftermath: The Last Days of the Baby Boom and the Future of Power in America.”
“[T]his is also a continuation of the pattern that we saw originating with the Baby Boom, back in the 1940s,” Bump said. “So, you have this big cluster of people all in the same age group that are reaching age milestones together. And when you think about the year in which there were the most births was 1957, you add 65 to that, the retirement age, and you get 2022.”
The trend is also placing additional strain on entitlement programs including Social Security and Medicare, Edelman said.
“[T]he challenge here is that, largely because of our aging population, but also because of increases in health care costs, we have very significant increases in benefits on the horizon,” she said. “But we haven’t planned for those with increases in taxes.”
Absent action at the national level, some states are taking action based on these population trends. In Washington state, a law is set to go into effect next week that will begin collecting a long-term care payroll tax to help fund a long-term care program.
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