Demographer Gillaspy: Brace for aging bubble
Tim King and I have been having a conversation on an earlier post about whether concern about an aging population might be a little exaggerated. Specifically, Tim has been urging us to look at the birth-to-death ratio in Todd County and explain what it means when more people are being born than are dying.
I asked Minnesota's state demographer, Tom Gillaspy, to weigh in, and here's what he had to say:
Births normally outnumber deaths by about 2 to 1 in most of the state. This is not a new thing and is the main source of our population growth. Also, generally over the past decade, births have been increasing (though down a bit for the recession). Over the next couple decades, births will continue to outnumber deaths though the ratio will decline a bit as we continue to age.
I assure you that the concern over aging is not overblown. The baby boom generation, born from 1946 to the early 60s, is now about age 50 to 64. This is a very large generation that is beginning to retire. At the same time, the high school graduation class of last spring will be the largest for about a decade and the population age 18-24 (college age) will decline in Minnesota and the US. More old folks retiring and fewer young entering the work force and our workforce growth will slow dramatically this decade. That will contribute substantially to declining economic growth. This is already happening in Japan and Europe and will soon begin to happen in China.
By 2020, Minnesota and the US will have more people over age 65 than children in K-12 education for the first time. The whole concern over health care costs is fueled by the aging of the population. Social Security now (as of the past couple months) has a net out flow of income and is beginning to dip into its trust fund. This date is a couple years earlier than expected due to the recession causing a decline in Social Security tax receipts and an increase in the number of people initiating Social Security retirement benefits. We have entered the "age of entitlements" that economists and demographers have been pointing to for about 4 decades.
You might want to listen to some recent MPR/NPR interviews with David Walker, president of the Peterson International Economics Foundation and former comptroller of the US currency and director of the GAO. His main topic is the financial situation resulting from promises we have made to people and are not prepared to pay for now that they are ready to collect.
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The David Walker interviews that Gillaspy mentions are here:
Gillaspy's point about future shrinking high school graduating classes reminds me that one of the countervailing forces in Todd County is the arrival of a younger, working-age set of immigrants. Half of Long Prairie kindergarteners are Hispanic.
That's one of the issues we expect to explore as we continue to report in Todd County, so if you have thoughts, let us know. How are people seeing an economic or any other impact of immigration?