workers.6 However the pattern of change in the SRW over time is similar to that of the SRU.

Table 3-5 summarizes estimates of six indicators in 2010 and 2050. These aging indicators differ because they are differently defined. Their absolute levels will not be examined here because there is little to be gained from a discussion of the differences. Instead the committee focuses on the projected trends (last column), which anticipate the future impact of population aging.

These results lead to two main conclusions regarding trends to 2050. First, the U.S. population will likely age substantially, as indicated by the 64 percent rise in the population aged 65+, the 81 percent rise in the OADR, and the 71 percent rise in the RWR. Second, the economic impact of this aging is cushioned by a decline in youth dependency.

The net effect of these demographic trends is best captured by the SRW, which is projected to decline 12 percent by 2050. This means that, other things being equal, consumption per capita will be 12 percent lower than it would be without population aging.7

Adapting to Population Aging

As noted throughout this report, adapting to future population aging might involve a rise in the age at retirement. Such an increase would counteract the projected adverse changes in most of the above indicators. To illustrate, Figure 3-15 plots the age at retirement (conventionally set at age 65) required to keep the OADR constant at 0.22. This calculation indicates that the age at retirement would have to rise from 65.0 in 2010 to 73.3 years in 2050 to prevent the OADR from increasing. A separate calculation indicates that a similar increase in age at retirement will keep the SRW constant. It should be emphasized that Figure 3-15 represents a purely hypothetical exercise to illustrate the magnitude of changes in age at retirement needed to keep this dependency ratio unchanged. Such a large change in age at retirement is likely to be politically unacceptable, and it is not the committee’s intention to recommend it.

It is worth noting that this increase in the age at retirement of 8.3 years is larger than the rise of 4.0 years needed to keep the ratio of retired to working years constant over the individual life cycle (see earlier discussion of Figure 3-4). The reason for this difference is that the rise in the age at retirement plotted in Figure 3-15 compensates both for the projected rise in life expectancy and for population aging resulting from fertility decline

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6The support ratio is typically less than unity because consumption is funded in part from sources other than labor income, such as asset income.

7That is, consumption per weighted consumer will decline by 12 percent, other things equal.



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