Population aging in the United States is a basic demographic phenomenon that is determined by the age distribution of a population and its history of births, age-specific deaths, and the rate of migration. Over the last decade, the U.S demographics have significantly changed with most people growing older. Consequently, the sequence has been described to have significant implications for the nations’ economic, health, and social institutions. The U.S population distribution has rapidly shifted in both the number and proportion. However, unlike the 1900s when population growth was on the rapid increase, the past decade has witnessed slowed population growth due to a significant decrease in fertility rates. Further, there was an increased rate of growth in the population of older adults above 65 years than the rest of the population (Iceland). However, the males register more births than females, although significant improvements in women mortality and increased male death rates drastically reduce the male number in older adults. Therefore, the sex ratio in the U.S. declines drastically with an increase in age. This study aims to analyze the implications of an ageing population on social and economic welfare in the USA.
The drop in the immigration numbers reflects a smaller share of the U.S population growth rate that has adverse effects on the economic productivity of the country. The decline in population growths has especially been associated with the loss of jobs in manufacturing and constructions, and other occupations that are filled by immigrants. However, the recent advancements in automation and mechanization have replaced some of the human labor that may result in increased production despite the loss of human labor. Consequently, the U.S. will have to make many changes to their systems because in future, they will be faced with an increase in the aging population who will demand more social security from the diminishing workforce. A strain on the available resources such as healthcare and pension will occur due to an increase in the aging population. Moreover, due to the reduced immunity of the aging populations, many are likely to suffer from chronic illnesses, which will lead to increased demand for health services.
The U.S will have to raise its budget allocations for social security. Due to the population growth decrease, the number of contributions to social security will significantly decrease as more funds are channeled to the aging and retired population. To achieve fiscal sustainability in the U.S, public pension programs will need significant alterations in the coming decades. Otherwise, if the public pensions remain as currently constituted, the younger working generation may have to remit over 20% of their incomes to the pension schemes (Uhlenberg 144). This will significantly reduce the disposable incomes, which subsequently affects the rate of investments in the country. This means that there will be decreased economic growth and the majority of the younger workforce will be demoralized due to the extensive fiscal pressure to sustain the aging population (Hobbs, Frank, and Nicole 56). Consequently, this will also discourage foreign direct investments resulting in mass unemployment.
The cost of healthcare is another profound economic implication of an aging population because as the population ages, their health declines. In turn, the decline in health requires more financial and scientific resources such as, medicine, and medical practitioners to conduct visits among others. For example, there is a higher prevalence rate of cancers and cardiovascular problems in the aging populations compared to the younger generations in the U.S (Uhlenberg 146) Consequently, public health expenditures will rise significantly, which means that the U.S must invest more human resources and funds into providing health care.
To curb the problems of an aging population in the U.S, I think there is a need for restructuring the immigration systems and laws. Fundamental changes to the structure of the prevailing immigration laws are needed (Uhlenberg 152). Additionally, the impact of automation and artificial intelligence could be accelerated to take more places that were initially taken by human labor. First, the U.S should consider enacting their policies concerning retirement schemes to allow older adults’ gradual retirement while working for fewer hours as opposed to being totally out of the job. This strategy will allow them to also pay taxes until a later age when one is considered totally unproductive. Secondly, the U.S should allow for furnishing options that reward volunteers and caregivers among the older populations (Uhlenberg 148). Encouraging the older employees to remain in the workforce longer can reduce the financial pressure and macroeconomic challenges related to population aging.
By providing the aging populations with an opportunity to serve in the workforce much longer, the U.S government can significantly gain in the provision of both economic and social benefits and relieve some of the fiscal pressure related to aging populations. However, policies should be developed in ways that recognize the autonomy and dignity of the older populations because work activities for the older adults do not automatically translate into social welfare progress.
Hobbs, Frank and Nicole Stoops. Demographic trends in the 20th century. Vol. 4. US Census Bureau, 2002.
Iceland, John. A portrait of America: The demographic perspective. Vol. 1. University of California Press, 2014.
Uhlenberg, Peter. “Demography of aging.” Handbook of population. Springer, Boston, MA, 2005. 143-167.