Aging in the American workforce
The aging workforce (also The Silver Tsunami) refers to the rise in the median age of the United States workforce, to levels unseen since the passage of the Social Security Act of 1935. It is projected that by the year 2020, about 25% of the U.S. workforce will be composed of older workers (ages 55 and over). While many factors contribute to the aging workforce, the Post-World War II baby boom created an unusually large birth cohort for the U.S. population, resulting in a large aging population today. This phenomena has many short-term and long-term implications, affecting many areas, including the U.S. economy, society and public health.
According to the Bureau of Labor Statistics, as of April 2014, the labor force participation rate was 62.8%. The overall labor force participation rate is expected to decline for the remainder of the decade, projected to fall to 62.5% in 2020. By the year 2020, the subpopulation of older adults in the United States is expected to reach 97.8 million people, comprising 28.7% percent of the entire U.S. population, a rise from the 24.7% in 2010. This increase in proportion of older adults can be attributed to the entire Baby Boomer cohort joining the older adult population (ages 55+) by 2020.
It is projected that by 2020, the proportion of the U.S. labor force that is composed of older adults will be 25.2%. This continues a trend in increasing rates of older adults remaining in the workforce, as the rates were 13.1% in 2000 and 19.5% in 2010. A complementary trend that follows this is the increasing median age of the U.S. workforce. By 2020, the workforce is expected to have a median age of 42.8, which will be an increase from 39.3 in 2000 and 41.7 in 2010.
A further factor contributing to an ageing workforce is the fact that employment rates among older workers are increasing. The rate of people who continue working after they are 65 is relatively high in the US, if compared to other developed countries. For example, in 2011, 16.7% among people aged 65 and over and 29.9% among 65-69 were employed in the US, while the corresponding rates in the EU were only 4.8 and 10.5%.
With continuing trends of an aging American workforce and a declining labor force participation rate, there may be many consequences arising from this phenomena. The impending repercussions from a large aging workforce entering retirement has led some to call this situation "The Silver Tsunami." The Silver Tsunami can have a profound effect on many areas of life.
Due to a declining labor participation rate, there is expected to be a shortage of workers in the U.S. workforce. Projections show that the demand for labor needed now is not being fulfilled, and the gap between labor needed and labor available will continue to expand over the future. Owing to the differences in population size between the Baby Boomers and the following younger generations, there has been negative growth in the working age population. The retirement of members of the aging workforce could also possibly result in shortages of skilled labor. A majority of experienced utility workers and hospital caregivers, for example, will be eligible for retirement.
Social security benefits
The U.S. federal social security system functions through the taxation of large numbers of young workers, in order to support smaller numbers of older dependents. A diminishing workforce, coupled with growing numbers of longer-living elderly can deplete the social security system. The Social Security Administration estimates that the old age dependency ratio (people ages 65+ divided by people ages 20–64) in 2080 will be over 40%, compared to the 20% old age dependency ratio in 2005. Increasing life expectancies of the older population will not only result in decreases in Social Security Benefits, but also devalues private and public pension programs. The dearth of funds supplying programs such as social security and Medicare may be a contributing factor for adults to delay retirement and to continue working.
Occupational safety and health
Because of the many older adults opting to remain in the U.S. workforce, many studies have been done to investigate whether the older workers are at greater risk of occupational injury than their younger counterparts. Due to the physical declines associated with aging, older adults tend to exhibit losses in eyesight, hearing and physical strength. Data shows that older adults have low overall injury rates compared to all age groups, but are more likely to suffer from fatal and more severe occupational injuries. Of all fatal occupational injuries in 2005, older workers accounted for 26.4%, despite only comprising 16.4% of the workforce at the time. Age increases in fatality rates in occupational injury are more pronounced for workers over the age of 65. The return to work for older workers is also extended; older workers experience a greater median number of lost work days and longer recovery times than younger workers. Some common occupational injuries and illnesses for older workers include arthritis and fractures. Among older workers, hip fractures are a large concern, given the severity of these injuries.
With larger numbers of older adults, there will be an increased need for geriatric care. Older adults will have to deal with more chronic diseases; older adults who have worked in the construction industry have shown high rates of chronic diseases. Experts suggest that the number of geriatricians will have to triple to meet the demands of the rising elderly. There is expected be a similarly increased demand in other healthcare professionals, such as nurses, physical therapists and dentists. In addition, there is expected to be an increasing demand over common geriatric care consumption needs, such as medications, joint replacements and cardiovascular operations.
The Silver Tsunami can potentially change American society as a whole. Many companies use an antiquated system, in which older, tenured workers get raises and benefits over time, eventually hitting retirement. With larger numbers of older workers in the workforce, this model is possibly unsustainable. In addition, perceptions of older adults in society will change, as the elderly are living longer lives and more active than before. Some state that society faces a cultural ageism in the perceptions about older adults, which will change over time.
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