Implications of Aging Populations 

and Increased Longevity 

for National Governments

Steve Goss, Chief Actuary

United States Social Security Administration

GAO/CNAO Joint Seminar

Impacts of Aging Populations on National Governments

March 13, 2018 
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Developed Nations Are “Aging”

 “Macro aging”

– Changing age distribution—getting older

» Mainly from drop in birth rates 

 “Micro aging”

– People are living longer

» Lower death rates

» Increasing longevity

 Different challenges—different 

solutions—consider the U.S.
Micro Aging 

We are living longer, but there are limits, and progress is slowing

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0.5

0.6

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0.9

1.0

0 10 20 30 40 50 60 70 80 90 100 110

Survival Curve U.S. Female: Period Data

1900

1925

1950

1975

2000

2013

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

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0 10 20 30 40 50 60 70 80 90 100 110

Survival Curve U.S. Male: Period Data

1900

1925

1950

1975

2000

2013
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Cause of “Macro Aging”

Mostly drop in birth rates

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2

3

4

5

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1865 1875 1885 1895 1905 1915 1925 1935 1945 1955 1965 1975 1985 1995 2005 2015

U.S. Total Fertility Rate: With and Without Adjustment for Survival to Age 10 

TFR Adjusted TFR

Notes: TFRs prior to 1917 are for whites only and survival rates prior to 1900 use Massachusetts data only.

1865-1895 4.44 3.09

1896-1925 3.36 2.80

1926-1965 2.86 2.71

1966-1990 1.99 1.95

1991-2015 2.00 1.98

Average Average

TFR Adjusted TFR 
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U.S. Drop in Birth Rate after 1965 Causes Dramatic Level 

Shift; Continuing Longevity Gains Are Gradual and Small

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0.05

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0.25

0.30

0.35

0.40

0.45

0.50

1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

Aged Dependency Ratio 2017 TR

Population 65+/(20-64) 

Actual and TR Intermediate

TFR remains at 3.0 after 1964

TFR remains at 3.3 after 1964
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Social Security Beneficiaries per 100 Workers 

Rise substantially due to this aging of the U.S. population 

20

30

40

50

60

1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090

Calendar year

Historical Estimated
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Social Security Cost as Percent of GDP 

For U.S., rises from a 4.2-percent average in 1990-2008, to about 6% by 2035

Cost for public and private pensions and health care rise similarly

3%

4%

5%

6%

7%

1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090

Calendar year

Non-interest Income

Historical Estimated

Cost
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Implications of “Macro Aging”

What will we need to do?

It is a pay-as-you-go world

– In the aggregate, consumption = production

Solutions for dealing with aging population

– The older age distribution for the U.S. requires:

» Elders consume less: 2/3 as much

» Working age share more: 3/2 as much

» Get elders to work a lot longer: 5 years, and more

» Or some combination
We Are All Aging Together

Canada, China, Denmark, Japan, Sweden, U.S.

– World Bank international population projections

Birth rates have dropped for all

– Resulting in sudden shifts in age distribution

Net immigration can help slow macro aging

– Or can hasten it if young individuals emigrate 

Increasing longevity is gradual 

We all have similar challenges

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Birth Rates Now Below “Replacement” 

(below TFR of 2.1 for all six nations)

1

1.5

2

2.5

3

3.5

4

1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

Total Fertility Rate

Canada China

Denmark Japan

Sweden United States

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Adding in Net Immigration Puts All But 

China and Japan Above “Replacement”

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1

1.5

2

2.5

3

3.5

4

1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

Adjusted Total Fertility Rate--Adding Net Migration to Births

Canada China

Denmark Japan

Sweden United States
Population Over Age 65 Is Increasing For All of Us

But this is not really our challenge

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0

200

400

600

800

1000

1200

1400

1600

1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

Population Age 65+; 1960 = 100

Canada China

Denmark Japan

Sweden United States
In 2000, 65+ Were Less Than 30 per 100 at Working Ages

By 2050, all but U.S expect over 40, Japan over 70

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0

10

20

30

40

50

60

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1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

Aged Dependency Ratio--Population age 65+ / 15-64

Canada China

Denmark Japan

Sweden United States
Implications for our National Governments, 

our Economies, our Populations

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GDP and total income will grow slower

– So we will at least avoid overpopulation

Those over 65 will live AND work longer

Workers will share more of their income

We may encourage more births

Immigration can help, but we cannot all gain

Our governments must plan for changes 

– Changes are needed VERY soon
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For More Information...

http://www.ssa.gov/oact/

 Annual Social Security Trustees Reports (U.S.)

https://www.ssa.gov/oact/TR/index.html

 Documentation of Trustees Report data & assumptions 

https://www.ssa.gov/oact/TR/2017/2017_LongRange_Demographic_Assumptions.pdf

 International Population Projections—World Bank

https://datacatalog.worldbank.org/dataset/population-estimatesand-projections

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