Demographic and Socioeconomic Change

in Appalachia

THE AGING OF APPALACHIA

by

John Haaga

Population Reference Bureau

April 2004
About This Series

“Demographic and Socioeconomic Change in Appalachia” is a series of reports that examine

demographic, social, and economic levels and trends in the 13-state Appalachian region. Each

report uses data from the decennial censuses of 1990 and 2000, plus supplemental information

from other data sources.

Current reports in the series include:

• “Appalachia at the Millennium: An Overview of Results from Census 2000,” by Kelvin

M. Pollard (June 2003)

• “Housing and Commuting Patterns in Appalachia,” by Mark Mather (January 2004).

• “The Aging of Appalachia,” by John G. Haaga (April 2004).

• “Households and Families in Appalachia,” by Mark Mather (forthcoming).

• “Educational Attainment in Appalachia,” by John G. Haaga (forthcoming).

Additional reports will cover: Labor Market Performance, Poverty, and Income Inequality;

Migration and Immigration; Population Change and Distribution; Geographic Concentration of

Poverty; and Race and Ethnicity.

You can view and download the reports by visiting either www.prb.org or www.arc.gov.

For more information about the series, please contact either Kelvin Pollard of the Population

Reference Bureau (202-939-5424, kelvinp@prb.org) or Gregory Bischak of the Appalachian

Regional Commission (202-884-7790, gbischak@arc.gov).

The authors wish to thank the Appalachian Regional Commission for providing the funding for

this series.

Population Reference Bureau

1875 Connecticut Avenue, NW, Suite 520

Washington, DC 20009-3728

The Population Reference Bureau is the leader in providing timely and objective information on

U.S. and international population trends and their implications.

Appalachian Regional Commission

1666 Connecticut Avenue, NW, Suite 700

Washington, DC 20009-1068

The Appalachian Regional Commission’s mission is to be an advocate for and partner with the

people of Appalachia to create opportunities for self-sustaining economic development and

improved quality of life.
THE AGING OF APPALACHIA

John Haaga

Population Reference Bureau

A few years ago, Peter G. Peterson, former secretary of commerce and deputy

director of the Federal Reserve Bank, argued that the ìgraying of the developed worldís

population Ö may actually do more to reshape our collective futureî than any of a list of

more publicized threats, in which he included high-tech terrorism, the proliferation of

weapons of mass destruction, globalization, and ethnic hatreds (Peterson, 1999: 42).

Since Sept. 11, 2001, of course, most Americans, perhaps Peterson himself, would rank

long-term changes in the age structure of the population somewhat lower on the list of

global threats. But Petersonís concern was not his alone, nor have the problems of

population aging that he described for the Western nations been solved in the years since.

The U.S. population is aging, although less rapidly than that of other rich countries

because of higher immigration and fertility rates. But the proportion of the population in

the Appalachian region over age 65 is already equivalent to that of Denmark and some

other smaller Western European countries, higher than that of the United States as whole.

Discussions of the implications of population aging usually concern the international

economy or vast federal programs like Social Security and Medicare. Does it matter

much for a region, like Appalachia, to be ahead of the curve, to be older than the nation

as a whole?

In this report, we use data from Census 2000 to show how and why the age

structure of the Appalachian population differs from the national average and varies

within the region. We discuss implications for the region and argue that they are not all

negative. The changing age structure will be an important fact of life for decisionmakers

in both the public and private sectors in Appalachia in coming yearsóbut not a dire

threat to standards of living.

Age Structure of Appalachia

In 2000, 14.3 percent of Appalachian residents were ages 65 and over, compared

with 12.4 percent of all U.S. residents. Northern Appalachia had the oldest population
2

among the subregions, with 16.0 percent ages 65 and over. Pennsylvania and West

Virginia ranked second and third among states in 2000 in the percentage of their

population ages 65 and over; only Florida ranked higher.

In the United States as a whole, the 65-and-over population grew during the 1990s

by 13.0 percentóslightly below the growth rate of the population as a whole, so the

proportion of the U.S. population ages 65 and older changed very little. But the median

age of the population increased from 32.9 to 35.3 during the decade. Figure 1, which

shows population pyramids for the United States in 1990 and 2000, gives a clue to this

apparent paradox. It shows that the largest two cohorts were born between 1956 and 1965

and were ages 25 to 34 in 1990 and 35 to 44 in 2000. (These two cohorts are often

designated the ìlate baby boomers,î with the ìearly baby boomersî those born between

1946 and 1955.) The cohorts born during the 1970s (ages 20 to 29 at the time of the 2000

Census) are considerably smaller, because birth rates in the United States during that

decade were well below the replacement level.

Immigration has helped fill in some of the peaks and troughs in the age-sex

pyramid, but one can still read there the history of boom and bust in fertility rates during

the 20th century. Especially at the older ages, the pyramids change shape because of

declining mortality rates. Each year Americans are more likely to survive into the top age

brackets: With fertility at replacement levels and little premature mortality, the diagrams

look more and more like cylinders, and the name ìpyramidî becomes less appropriate.

Those who reached age 65 during the 1990s belonged to the small cohorts born during

the Depression years of the 1930s. They did not add much to the 65-and-over population

during the 1990s. But the large baby-boomer cohorts advancing steadily in age

nonetheless raised the ìcenter of gravityî of the age-sex pyramid, the median age of the

whole population. It is clear from these diagrams that the aging of the U.S. population

will accelerate soon, as the baby boomers replace the Depression-era cohorts in the 65-

plus age bracket. The first baby boomers will turn 65 in 2011, which will begin a period

of several decades of rapid increase in the proportion of the population ages 65 and over.
3

Figure 1b

Population by Age and Sex, United States, 2000

54321012345

0-4

10-14

20-24

30-34

40-44

50-54

60-64

70-74

80-84

Percent

Female

Male

Source: PRB tabulation of data from 2000 census, SF3 release.

These same processes affecting the U.S. population as a whole can be traced in

the changing shape of an age-sex pyramid for Appalachia. The same bulge of the babyFigure 1a

Population by Age and Sex, United States, 1990

5 4321012345

0-4

10-14

20-24

30-34

40-44

50-54

60-64

70-74

80-84

Percent

Female

Male
4

boom cohorts, advancing steadily upward through the age brackets, can be seen for

Appalachia in Figure 2.

Figure 2a

Population by Age and Sex, Appalachia, 199

54321012345

0-4

10-14

20-24

30-34

40-44

50-54

60-64

70-74

80-84

Percent

Female

Male

Figure 2b

Population by Age and Sex, Appalachia, 2000

54321012345

0-4

10-14

20-24

30-34

40-44

50-54

60-64

70-74

80-84

Percent

Female

Male

 Source: PRB tabulation of data from 2000 census, SF3 release.
5

Table 1 provides a snapshot of the age structure of the population in 2000, for the

United States and Appalachia, for subregions, and for Appalachian counties classified by

their economic performance. Three age groups are shown, roughly corresponding to the

school-age population (ages 5 through 19), the working-age population (ages 20 through

64), and the retirement-age population (ages 65 and over). These classifications clearly

do not correspond exactly to economic roles: People may be working or studying at any

age. The ìyouth deficitî in the Appalachian region is fairly evenly divided between the

school-age and working-age populations, both of which are slightly lower than the

corresponding national percentages. There is little difference in age structure among the

economic performance categories, with a slight tendency for the less prosperous counties

to have higher proportions of older people. The major difference is the regional one, a

significantly older population in Northern Appalachia.

Table 1

Age Structure of Appalachia, by Region and Economic Status, 2000

A more complicated picture emerges at the county level. As the map in Figure 3

shows, the highest percentages of residents age 65 or older are generally found

throughout the Appalachian portions of Pennsylvania, in eastern Ohio and northern and

eastern West Virginia, and in southwest Virginia and western North Carolina. The

School ages Working ages Retirement ages

 (5-19) (20-64) (65+)

United States 21.7% 59.1% 12.4%

Appalachia 20.5 59.1 14.3

Northern 20.4 57.8 16.1

Central 20.3 59.9 13.8

Southern 20.6 60.1 12.8

Attainment 20.2 60.2 13.1

Competitive 20.9 60.0 12.4

Transitional 20.4 58.7 14.9

Distressed 20.9 59.2 14.0

Source: PRB analysis of data from Census 2000, SF3 release.
6

 southernmost parts of the region, in northern Alabama and northeast Mississippi, also

have several counties with particularly old populations. Few Appalachian counties have a

smaller proportion of elderly residents than the national average; almost all of them are in

the greater Atlanta area. A similar pattern is seen in Figure 4, a map showing countylevel proportions of the ìoldest-old,î those ages 85 and over.

Figure 3
7

Demographic projections prepared by Regional Economic Models, Inc., show

that, with current trends, the Appalachian region will be home to over 5 million people

ages 65 and over in 2025, just under 20 percent of the total population (Table 2). One of

every 40 Appalachian residents will be among the oldest old, those ages 85 and over, in

2025. As is currently the case, Northern Appalachia is expected in 2025 to have a

Figure 4
8

significantly older population than the rest of the region and the nation as a whole, with

23.5 percent of its population ages 65 and over.

Table 2

Projection of Elderly Population, U.S. and Appalachia, 2000-2025

U.S. Total Appalachia

Population ages 65+ (millions) 2000 35.1 3.3

2025 63.5 5.1

As percentage of total population 2000 12.4 14.3

2025 18.2 19.8

Population ages 85+ (millions) 2000 4.3 0.4

2025 8 0.6

As percentage of total population 2000 1.5 1.7

2025 2.3 2.5

Sources: U.S. Census Bureau, International Program Data Base (July 2003 version); Regional Economic Models, Inc.

Reasons for Population Aging

At the national level, the process of population aging is due primarily to long-term

declines in the fertility rate and to improvements in survival at all ages, especially at older

ages in recent decades. Of the three components of population change, fertility, mortality,

and migration, fertility and mortality are the ones that account for the changing age

distribution of the U.S. population during the last century, but migration that accounts for

the geographic variation within the United States seen in Census 2000.

The higher proportion of older residents is not a sign that people in Appalachia

live longer than others. On the contrary, the Appalachian region has generally high

mortality rates, adjusted for the age, sex, and race distribution of the popula-
9

tion.1 Likewise, the geographic variation in age distribution is not due to significant

geographic variation in fertility rates. The South used to have measurably higher fertility

than other parts of the country, but geographic variation in fertility rates has greatly

diminished in the last half-century in the United States.

The major reason for the difference in age structure between the Appalachian

population and that of the United States as a whole is the net out-migration

of young adults from Appalachia to other parts of the country, and Appalachiaís

relatively low share of immigrants from other countries. Table 3 shows the net percentage

changes during the 1990s in the size of selected cohorts (groups of people who were born

in the specified five-year periods) in the United States as a whole, Appalachia, and

northern Appalachia (the oldest of the subregions). Within a cohort, the gains for the

United States as a whole are the result of net immigration of people born during those

years (minus those who died during the decade). For Appalachia, the gains or losses also

reflect net migration of people in each cohort into the region from other parts of the

United States, as well as from other countries. The four cohorts shown were born

between 1961 and 1980, and thus were ages 10 to 29 in the 1990 census and ages 20 to

39 in the 2000 census; these ages bracket the peak migration ages both within the country

and from abroad. It can be seen that Appalachia as a whole lost members of the 1971-

1975 cohort (who were in their 20s during the 1990s). Northern Appalachia lost one-fifth

of the members of that cohort.

 1 The Atlas of United States Mortality, published by the Centers for Disease Control and Prevention (Pickle,

et al., 1996) provides a very striking visual display of regional variation in mortality rates, using ìhealth

service areasî (groups of counties) as a unit of analysis. The ìall-causeî standardized mortality rates

consistently show central Appalachian regions among the worst in the country for white males and white

females, and very few Appalachian areas better than national averages for whites or blacks, males or

females. The only Appalachian area with lower-than-average mortality rates appears to be western North

Carolina, for both white males and white females (see pages 168, 172).
10

Table 3

Changes in Population of Birth Cohorts, 1990-2000

Americans are mobile, and many parts of the South and West, in particular, attract

retirees from other parts of the country. Serowís 2001 analysis showed that some

Appalachian counties, in western North Carolina, eastern Tennessee, and northeastern

Georgia, have gained elderly population through retirement migration. Such ìretirement

magnetsî tended to be counties that were already relatively prosperous for the region,

with recreational amenities and locations convenient to metropolitan areas. But most

Americans ìage in place.î An analysis of detailed migration data from the 1990 census

showed relatively little net migration of older people (ages 65 and older) into or out of the

Appalachian regions (Obermiller and Howe, 2000: table 6). Appalachia as a whole

gained just over 12,000 older residents through migration from 1985 to 1990 (202,000 inmigrants minus 190,000 out-migrants). Northern and central Appalachia lost elderly

migrants, on balance, while southern Appalachia offset their losses with a net gain of

nearly 24,000 elderly residents through migration in those years.

Poverty and Disability in the Older Population

We have selected four groupings of counties, to illustrate the range of economic

and health conditions for older people and households within the Appalachian region. 2

These groupings of counties include:

 2

 The Public Use Microdata Sample 1 percent files do not allow users to identify geographic areas smaller

than the ìSuper-Public Use Microdata Areasî (Super PUMAs), groups of counties defined by the Census

Bureau, each with a population large enough to protect confidentiality (at least 400,000 persons).

Birth years U.S. Appalachia

Northern 

Appalachia

(% change in population)

1976-1980 10.8% 4.5% -1.9%

1971-1975 9.2 -8.9 -20.9

1966-1970 7.8 2.0 -8.5

1961-1965 6.5 12.1 6.4

Source: PRB tabulation of data from 1990 and 2000 censuses.
11

• Two counties in southwestern Pennsylvania, Westmoreland and Fayette. One is

economically ìdistressed,î the other transitional; one lost population in the 1990s,

and the other gained slightly. They are adjacent to the Pittsburgh metropolitan

area. Both have very high percentages of older residents.

• Sixteen counties in southwestern West Virginia, including the Charleston and

Huntington metropolitan areas. Most lost population during the 1990s, but

Putnam County gained more than 20 percent. All are older than the national

average. Ten are distressed counties, six transitional.

• Twenty-six counties in eastern Kentucky, stretching from Greenup in the north to

Whitley along the Tennessee border. Two form part of metropolitan Huntington,

four are ìmicropolitanî in the new classification, and the rest are outside microor metropolitan areas.3

 All are distressed counties; all grew moderately in

population during the 1990s.

• Nineteen counties of western North Carolina, including all those on the border

with Tennessee, and Henderson, Buncombe, Surry, and Wilkes counties to the

east. These include several fast-growing counties along the Georgia border, the

growing cities of Asheville and Boone, and several ìretirement magnetî and

recreational counties. They have relatively high proportions of older residents.

Three are distressed counties, 14 transitional, and two ìcompetitive.î

None of these four areas is a microcosm of Appalachia. But they do represent the

variation found within the region in economic prosperity, migration and population

growth, and distance from metropolitan areas. They are likely as well to reflect the

variation in economic and health conditions for older people.

Poverty. Thanks in large part to the spread of the Old Age and Survivors

Insurance program under Social Security, and to a lesser extent the spread of private

pensions, poverty rates decreased in the last half of the 20th century, faster for older

 

Unfortunately, the Super PUMA boundaries straddle the boundaries of the Appalachian region as defined

by the ARC, preventing us from showing Appalachian totals in Table 3. The Super PUMAs analyzed here

are 42080 (Pa.), 21300 (Ky.), 37010 (N.C.) 54300 (W.Va.). Boundaries for all Super-PUMAs can be found

on the Census Bureau website at www.census.gov/geo/www/maps/sup_puma.htm.

3

 In June 2003, the Office of Management and Budget issued new definitions of metropolitan areas for the

United States, based on results of the 2000 Census. Micropolitan statistical areas include counties outside

metropolitan areas that have an urban cluster of between 10,000 and 50,000 people. The designation

includes the county where the urban cluster is, plus adjacent counties linked by commuting ties.

Metropolitan statistical areas have an urban core of at least 50,000 people, and include the county in which

the core is located as well as adjacent counties linked by commuting.
12

people than for other age groups. Just under 10 percent of older people nationwide

reported family incomes below the poverty level in Census 2000. Poverty rates are

typically higher for older women than for older men: Nationwide, 12 percent of older

women had family incomes below the poverty line, compared with 7 percent of older

men.

As Figure 5 shows, the subregions of Appalachia vary widely in poverty rates

among older people. Poverty rates for the over-65 population were fairly close to the

national average in southeastern Pennsylvania, southern West Virginia, and western

North Carolina, but poverty rates were higher for the over-65 population as a whole and

for all subgroups in eastern Kentucky. The oldest-old, those ages 85 and over, were more

likely to be poor than the entire over-65 population.

Figure 5

Poverty Rates for the Older Population

by Appalachian Area, 2000

21%

32%

10%

16%

10%

13%

27%

23%

20%

16%

10%

19%

7%

9%

7%

13%

21%

18%

15%

12%

Southeast Pa.

Eastern Ky.

Western N.C.

Southern

W.Va.

USA

Women 65+

Men 65+

Women 85+

Men 85+ 

Source: PRB tabulation of 1 percent Public Use Microdata Sample, Census 2000.

Geographic areas are Super PUMAs (see note 2).

One of the notable trends in the 2000 Census was the increase in the number and

proportion of single-person households. This trend was due both to a rise in the age at

marriage (which was only partially offset by an increase in the number of cohabiting
13

couples) and the increase in the proportion of older people living alone, many of them

divorced or widowed. Because womenís life expectancy at age 65 is almost three years

longer than for men, the widowed and those living alone are disproportionately women.

In the nation as a whole, 36 percent of women ages 65 and over live alone; the proportion

is somewhat higher in each of the Appalachian regions shown in Figure 6. Older people

living alone were more likely to be in poverty than those living with a spouse, children,

or others.

Figure 6

People Ages 65+ Living Alone, by Sex

18%

14%

18%

17%

37%

41%

39%

42%

36%

22%

Southeast Pa.

Eastern Ky.

Western N.C.

Southern

W.Va.

USA

Women

Men

Source: PRB tabulation of 1 percent Public Use Microdata Sample, Census 2000. Geographic areas are Super PUMAs

(see note 2).

One in five elderly women living alone were poor in the nation as a whole. The

poverty rate for elderly women living alone was not significantly higher than the national

rate in southeast Pennsylvania and southern West Virginia. But in eastern Kentucky and

western North Carolina, one in three elderly women living alone were in poverty (Figure

7).

Figure 7
14

Poverty Rates for the Older Population Living Alone

by Appalachian Area, 2000

20%

48%

19%

16%

16%

14%

35%

28%

31%

21%

18%

36%

25%

17%

15%

20%

32%

33%

25%

20%

Southeast

Pa.

Eastern Ky.

Western N.C.

Southern

W.Va.

USA

Women 65+

Men 65+

Women 85+

Men 85+ 

Source: PRB tabulation of 1 percent Public Use Microdata Sample, Census 2000.

Geographic areas are Super PUMAs (see note 2).

Disability. Disability rates have been declining for older people in the United

States during recent decades. This has been found for several dimensions of disability,

using several different data sources.4

Census 2000 included several questions designed to measure disability among the

household population. For adults, these included questions about sensory limitations

(blindness, deafness, or severe vision or hearing impairments); physical functioning

(limited ability to walk, climb stairs, lift or carry objects, etc.); mental functioning

(difficulty in learning, remembering, or concentrating); self-care (difficulty dressing,

bathing, or getting around in the home); mobility (difficulty going out alone to visit a

doctor or to shop); and employment disability. For most of these categories, the definition

of disability was restricted to those caused by long-lasting conditions, not transitory

 4

 The percentages of older people reported to have any disability have been declining, by about one

percentage point per year (Freedman et al., 2002). There is little agreement across data sources in the

relative decline among different groups of the elderly, and thus what is happening to differentials among

races or across regions of the country. But the overall conclusion is that longer lives for the elderly mean

longer healthy lives, on average, not just more years spent with disabilities.
15

ailments. Surveys of health and disability typically include long lists of conditions and

follow-up questions to distinguish the severity and nature of disabilities. Census 2000

was limited to these broad questions both to keep the questionnaire a reasonable size and

because it was self-administered for most people. Sources of disability data vary

considerably in the conceptual basis for defining disability. Accordingly, the census

results shown here are not exactly comparable to those obtained from more specialized

studies of disability. But they have proved to be fairly reliable and useful in several

methodological studies (Andresen et al., 2000; Calsyn et al., 2001). The census data have

the great advantage of being available for geographic regions of interest, rather than only

for the nation as a whole or only for individual states.

Forty-four percent of all Americans ages 65 and over were reported to have one or

more of the disabilities measured by Census 2000. For 23 percent of the elderly, these

included mobility restrictions and, for 12 percent, a limited ability to take care of

themselves (bathing, dressing, etc.). Such self-care questions typically are good

predictors of home care use and moves to nursing homes. For the oldest old, those ages

85 and over, more than three-quarters reported some disability. Reported disability was

typically somewhat higher for women than for men. Older people living alone reported

disability rates somewhat higher, for the nation as a whole and in most Appalachian

regions, than those living with others.
16

Figure 8

Disability Rates for the Older Population, 

by Appalachian Area, 2000

45

91

67

74

67

43

81

81

84

78

37

64

44

55

42

43

60

52

54

46

Southeast Pa.

Eastern Ky.

Western N.C.

Southern W.Va.

USA

Men 85+ Women 85+ Men 65+ Women 65+

Figure 9

Disability Rates for the Older Population

Living Alone, by Appalachian areas, 200

38

83

68

82

66

75

85

74

80

72

65

72

49

59

47

80

63

52

54

48

Southeast Pa.

Eastern Ky.

Western N.C.

Southern W.Va.

USA

Men 85+ Women 85+ Men 65+ Women 65+

Source (Figures 8 and 9): PRB tabulation of 1 percent Public Use Microdata Sample, Census 2000.

Geographic areas are Super PUMAs (see note 2).
17

Three of the four Appalachian subregions analyzed here had disability

ratesóoverall, mobility, and self-careógenerally somewhat higher than those for elderly

people in the nation as a whole (Figure 8). Eastern Kentucky was again the exception,

with disability rates well above the national average.

Disability rates increase with advancing age, as one might expect. It is worth

noting that the rates are just as high for older people living alone as for those living with

spouse, children, or others (Figure 9). The Appalachian areas all have higher percentages

of older people living alone than the national average, possibly because of the high rates

of out-migration of younger people from the region.

Decline of the Child Population

The bulge of baby boomers approaching retirement ages is the feature of the age

distribution that receives the most attention. But the long-term decline of the child

population as a proportion of the total deserves some notice as well. Both for the United

States as a whole and for the Appalachian region, the cohort of under-5-year-olds in

Census 2000 is smaller than the three cohorts above it, the currently school-age

population of 5-to-19-year-olds. The small cohorts born during the ìBaby Bustî years of

the 1970s aged out of the school-age population by 2000. The current school-age

population consists of somewhat larger cohorts, the children for the most part of the very

large baby-boom generation. These large cohorts of teenagers are sometimes referred to

as the baby-boom echo; we might call the small cohorts of current preschoolers the babybust echo.

This picture can be complicated for the country as a whole by changes in

migration, and for particular regions both by immigration from other countries and by

migration to or from other parts of the country. As another report in this series discusses

more fully, the Appalachian region has not in recent years attracted a large share of

migrants, and internal migration is relatively low during childhood, so the current

preschool population in Appalachia should be the school-entry population in years ahead.

As Table 3 shows, the under-5 population as a proportion of the total has fallen for the
18

nation as a whole, and for Appalachia from 1990 to 2000. This proportion is lower for

Appalachia, and for northern Appalachia in particular.

Table 3

Children Under 5, as a Percent of Total Population

1990 2000

United States 7.3% 6.8%

Appalachia 6.5 6.1

Northern 6.6 5.7

Central 6.2 6.0

Southern 6.7 6.5

Source: PRB tabulation of data from 1990 and 2000 censuses.

Implications of Population Aging

Discussions of economic impact of population aging typically focus on the

national-level fiscal effects, especially on the two large federal programs, Social Security

and Medicare. This perspective overlooks the state and local effects and contributes to the

general perception of older residents as an economic problem to be solved. But even in a

narrow economic focus, the older population has to be seen as a resource, not just

consumers of public services. The ìyoung oldî (those ages 60 to 75) especially tend to be

viewed as a fiscal boon for communities. Most have some retirement income from private

and public sources (the earliest age for drawing Social Security retirement benefits is 62,

which is also the most common age for new claims.) Few have school-age children, and

most thus place limited demands on local public services. In the 1980s, there was a

reversal of a long-term decline in the proportion of men in these ages still in the labor

force. Increasingly, both men and women ease into retirement with ìbridge jobs,î which

may be temporary or part-time, thus providing an attractive source of experienced

workers who may not require employer-provided health insurance (Quinn, 2000).

An analysis of data from a national sample of men and women in their 60s, both

workers and young retirees, showed that a steadily increasing proportion report they are

able to work. The improvements are fairly dramaticóthe proportion of 67-year-olds who
19

reported in 1993 that they were unable to work for health reasons was the same as the

proportion for 65-year-olds a decade earlier (Crimmins et al., 1999).

Crimmins and her colleagues found that most of the improvement over time is associated

with the increasing educational attainment of older workers.

 Press reports provide anecdotal evidence of local communities striving to achieve

through policy just the kind of demographic trend that much of Appalachia has

experienced by default. Economic development offices encourage retirement migration

by the ìyoung oldî and try to discourage retirees from moving away. For example,

Blacksburg, Va., adopted a comprehensive economic development plan in 1996 that

targeted retirees, proposing to issue new zoning codes to facilitate private development of

retirement communities (Lemov, 1996). Clearly, the growth of the 65-and-over

population is not regarded by state and local decisionmakers simply as a fiscal problem

(the impression one would get from most discussions of the federal budget).

Nationwide, some 75 percent of households headed by people ages 65 and over

get half or more of their income from Social Security (Federal Interagency Forum, 2000).

Because of their higher proportions of elderly residents, most of the Appalachian states

have high numbers of residents receiving Social Security benefits. West Virginia ranks

number one among states, with 22.3 percent of state residents receiving benefits (Social

Security Administration, 2003; table 1). In the Appalachian states with percentages of

beneficiaries below the national rate of 15.7 percent (New York, Maryland, and

Virginia), the Appalachian counties all have rates above the national rate.

The Social Security system is redistributiveóthat is, payments are related to

beneficiariesí incomes during their working years, but payments to low-wage retirees are

a considerably higher proportion of preretirement income than are the payments to those

who earned high wages while they were working (see Lee and Haaga, 2002, for

discussion and examples). But as we have seen, Social Security, supplemented by private

pensions, does not overcome very high regional disparities in older peopleís incomes,

even within the Appalachian region. Many low-wage workers (including farm laborers

and domestic workers) were not covered by Social Security; the expansions of coverage

in recent decades will affect future generations of retirees but not those currently in the

very oldest ages.
20

High poverty rates among elderly people living alone are a particular problem for

the Appalachian region, where higher proportions of older people live alone than the

national average. The census does not collect information on how distant older people are

from their relatives, nor on financial support and other types of caregiving between the

generations. Some of those who show up in census data as living alone and in poverty

may in fact have relatives and friends living nearby with whom they can share expenses

or from whom they receive financial support. But research using sample survey data with

more detailed measures of functional status than are available in the census confirms that

adults living alone show significantly lower levels of functioning than married adults,

across a range of indicators of mobility, emotional, and physical health (Waite and

Hughes, 1999). The high rates of poverty for older people living alone have to be seen as

a real indicator of social problems among the elderly left behind in Appalachia.

 The disability rates among older people provide an indicator of needs for many

types of services, ranging from expensive institutional long-term care to home health care

services or meals on wheels. Long-term care has proved to be an especially difficult

problem nationally for health care financing. Despite attempts to encourage the

development of private insurance markets, the proportion of older people with any

private coverage is still minuscule.

Medicaid (a joint federal/state program) has ended up by default as the largest

payer for long-term care. Long-term care and prescription drugs are major reasons for the

rapid rise in Medicaid expenditures. Medicaid was one of the fastest-growing lines in

state budgets during the period of expansion in the late 1990s, and Medicaid expenditures

were generally protected when states cut back on expenditures in 2001-2003óin part

because cutting back on state Medicaid spending would reduce the flow of federal

matching funds (Holahan, Wiener, and Lutzky, 2002). Older Medicaid recipients are

much more ìexpensiveî than younger women and their children, who are the majority of

beneficiaries.

Long-term care, especially institutional care, is very expensive (a year in a

nursing home cost on average $49,000 nationwide in 2000), and states are required by

Medicaid to keep their reimbursement rates high enough to cover the costs of an efficient

and safe nursing home that meets quality standards. In 1999, the Supreme Court ruled in
21

Olmstead v. L.C. that institutionalization of the frail elderly when home services would

enable them to live independently constitutes discrimination under the Americans with

Disabilities Act. This decision has prompted renewed expansion of home- and

community-based services for the elderly in many states. The growth of the elderly

disabled population will clearly put continued pressure on state budgets, in the absence of

national-level reforms in financing for health and long-term care (Milne et al., 2004).

The growth of the elderly disabled population also puts a strain on local

government finance. The degree to which counties finance part of the cost of long-term

care varies among states; in New York, where the local share of Medicaid funding is

highest, county governments pay 10 percent of the cost of institutional long-term care and

25 percent of other Medicaid services (Polgreen, 2003). Counties also provide services

such as transportation for the disabled and senior centers, demand for which will grow

with an aging population.

The growth of long-term care services, both in the community and in nursing

homes, has created a nationwide shortage of workers, complaints about which barely

slowed down during the recent recession (Salsberg, 2003). The Bureau of Labor Statistics

projects 50 percent growth in employment of home health aides during the current

decade, for example (Hecker, 2001). Though many jobs in health care and long-term care

are poorly paid, there are opportunities for skilled and managerial employment, and a

labor shortage should create pressure for higher wages. Community colleges often

provide training for the skills required, and the Appalachian region has succeeded in

recent years in providing community college education for more residents. The growth of

the elderly disabled population can also be seen as a spur to demand for local laboróone

that, unlike call centers and other growth sectors of the 1990s, cannot easily be moved

offshore.

In the next decade, service needs of all sorts for the geriatric population are likely

to drive budgets for state and local government, as well as for private philanthropy,

simply because of easily anticipated demographic changes in the region. As William Frey

(1999) pointed out, ìThose who retired in the late 1980s and 1990s did not face sharp

competition among themselves for good housing, benefits, access to medical services,

and the like because this group represented the relatively small ëDepression cohortsí that
22

could easily assimilate into the national economy as well as to the local community.î In

many ways, the 1990s and the 2000s have been the calm before the storm for all

institutions working with the elderly.

But for institutions serving children, the opposite could be true. The post-babyboom-echo decline in the child population as a proportion of the total can be seen as a

demographic window of opportunity for the education system, for child health, and other

public and private services for childrenóthe obverse of the challenge for services to

older people. Their ìcustomerî population should be shrinking. The National Center for

Education Statistics projects that elementary and secondary enrollments will be lower in

2012 than in 2000 for every Appalachian state except Georgia, Virginia, and Tennessee.

West Virginiaís school population in 2012 is projected to be 8 percent smaller than in

2000, the biggest decrease in the nation (Gerald and Hussar, 2002, table 4). The majority

of baby boomers, meanwhile, will still be in the work force, many of them in peak

earning (and tax-paying) ages for a few more years. During the enrollment declines of the

baby bust years of the 1970s and early 1980s, per pupil expenditures rose nationwide, and

class sizes fellóthough in fact, class sizes had also fallen and per pupil expenditures rose

even during the baby boom years (Guthrie, 1997).

The need for services and the difficulty of delivering them depend on much more

than just the sheer numbers in the relevant age groups, of course. Trends in family

demography may also promise some good news for child advocates and service

providers. Some long-standing trends with harmful consequences for children, such as

the increase in the proportion of births to unmarried parents and the increasing divorce

rates, have slowed and even reversed during the last decade (Casper and Bianchi, 2001).

Both basic population dynamics and family structure may be giving us a five- or 10-year

spell during which systems serving children can be strengthened.

This same period is the last chance to prepare at every level of government for the

revenue and expenditure effects that the baby-boom retirement will bring. The

Appalachian region will hardly be alone in dealing with the challenges. But the stresses

will be most visible in Appalachia, with its markedly older population.
23

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