Social Security Actuarial Status:

A Summary of Results from

the 2019 Annual Report of the Board of Trustees 

of the OASI and DI Trust Funds 

Office of the Chief Actuary, SSA 

May 10, 2019
What Is the Legislative Mandate for the Annual Report?

1) Trust Fund operations of the past year and the 

next five years

2) Actuarial status of the trust funds

– This means the ability to meet the cost of scheduled 

benefits with scheduled revenue and trust fund 

reserves

– And the extent to which scheduled revenue will fall 

short, forcing cuts or delays in benefits in the absence 

of legislative change

2
Primary Changes this Year

1) DI reserve depletion extended another 20 years, to 2052!

a) Further drop in applications and benefit awards in 2018

b) More gradual increase to ultimate incidence rate

c) Lower ultimate incidence rate—back to 2008-11 TR assumption

d) Restore reconsideration step in disability process in 10 states

2) OASI reserve depletion is 2034—the same as in last year’s report.

3) OASDI reserve depletion is now 2035 versus 2034 in last year’s 

report. Actuarial deficit decreased by 0.06 percent of payroll versus 

expected increase of 0.05 percent from change in valuation period 

alone. Annual deficits smaller throughout the 75-year projection 

period.

3
SOLVENCY: OASDI Trust Fund Reserve Depletion in 2035 (one year later than last year)

o Reserve depletion date varied from 2029 to 2042 in reports over the past 27 years (1992-2019) 

o DI Trust Fund — reserve depletion in 2052, twenty years later than last year

o Due largely to lower recent and near-term disability applications and awards. 

4

0%

50%

100%

150%

200%

250%

300%

350%

400%

450%

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055

Social Security Trust Fund Ratios

Assets as Percent of Annual Cost

Trustees Report Intermediate Projections

OASDI 2019TR

OASI 2019TR

DI 2019TR

OASDI 2018TR

OASI 2018TR

DI 2018TR

Historical

DI

OASDI

OASI

Tax Rate

Reallocation

Estimated
Applications for Disability Benefits Continue to Fall

At the peak of the last economic cycle in 2007, applications were low, but increased rapidly in 

the recession to over 2 million in 2010. In 2016, 2017 and 2018, with the economy still below the 

sustainable full-employment level, applications have dropped below the 2007 level

5

1.4

1.5

1.6

1.7

1.8

1.9

2.0

2.1

2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027

(millions)

Total Social Security Disability Receipts at Disability Determination 

Services by Calendar Year: Historical and Intermediate 

Assumptions for 2012 through 2019 Trustees Reports

2012TR

2017TR

2016TR

2015TR

2014TR

2013TR

2018TR

Note: All historical and projected 

series include disabled worker, 

disabled adult child, and disabled 

widow(er) receipts. DIBs represent 

about 94% of total title II DDS 

receipts. 2019TR
Disability Incidence Rate Falls to Historic Lows

DI disabled worker incidence rate rose sharply in the recession, and has 

declined since the peak in 2010 to extraordinarily low levels for 2016, 2017 and 2018

6

4.0

4.5

5.0

5.5

6.0

6.5

1990 1995 2000 2005 2010 2015 2020 2025 2030

DI Age-Sex-Adjusted Incidence Rates:

Historical and Intermediate Assumptions for 2012 through 2019 Trustees 

Report

2012TR

2013TR

2014TR

2015TR

2016TR

2017TR

Average 1990-2018 5.19

Ultimate Assumption 5.20

2018TR

2019TR
Fewer Disabled Worker Beneficiaries 

Fewer now and in near term based on recent applications and incidence rates

7

6,000

7,000

8,000

9,000

10,000

11,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Disabled Worker Beneficiaries

In Current Payment Status at End of Year (in thousands)

2008 TR (no recession)

2019 TR

2018 TR
8

OASDI Annual Cost and Non-Interest Income as Percent of Taxable Payroll 

Persistent Negative Annual Cash-Flow Balance Starting in 2010 

80% of scheduled benefits still payable at trust fund reserve depletion

Annual deficit in 2093: 4.11 percent of payroll — 0.25 percent smaller than last year

0%

5%

10%

15%

20%

25%

2005 2015 2025 2035 2045 2055 2065 2075 2085 2095

Calendar year

Cost: Scheduled and 

payable benefits

Non-interest Income

Payable benefits as percent

of scheduled benefits:

2018-34: 100%

2035: 80%

2093: 75%

Cost: Scheduled but not 

fully payable benefits

Expenditures: Payable benefits = income 

after trust fund depletion in 2035

Historical Estimated
Aging (change in age distribution)

mainly due to drop in birth rates

9

0.00

0.05

0.10

0.15

0.20

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 2019 TR

Population 65+/(20-64) 

Actual and TR Intermediate

TFR remains at 3.0 after 1964

TFR remains at 3.3 after 1964
Mortality Experience: All Ages

Reductions continue to fall short of expectations

10

700

750

800

850

900

950

1,000

1,050

1,100

1990 1995 2000 2005 2010 2015 2020

Age-Sex-Adjusted Death Rates

(Total, All Ages)

2017TR 2018TR 2019TR Actual
11

• Valuation Period - 0.05 percent

• Legislation etc. 0.00 percent

• Lower recent birth data and lower assumed near-term total 

fertility rate - 0.02 percent

• Higher recent mortality +0.09 percent

• Immigration assumptions and other data updates - 0.01 percent

• Lower ultimate annual rate of change in labor productivity - 0.09 percent

• Lower assumed price differential +0.09 percent

• Higher long-term real-wage differential +0.03 percent

• Lower ultimate real interest rate - 0.08 percent

• Starting values and other near-term economic assumptions +0.01 percent

• Lower recent and near-term disability applications and 

incidence rates +0.03 percent

• Lower ultimate disability incidence rate +0.04 percent

• Other new data and methods improvements +0.01 percent

Net Change for All Reasons +0.06 percent

Principal Reasons for Actuarial Balance 

Change in 2019 Report 
12

Do Entitlements Really Raise Federal Debt? 

Not Under Current Law!

0

20

40

60

80

100

120

140

160

180

200

2000 2010 2020 2030 2040 2050 2060 2070 2080 2090

Publicly Held Debt as a Percentage of GDP

Projected Federal Debt Held by the Public: CBO Baseline (Assuming OASDI 

& HI Unfunded Obligations Are Paid by Borrowing From the Public) vs. 

Assuming Current Law 

CBO Baseline July 2015

Less OASDI Unfunded Obligations (CBO Dec 2015)

Less OASDI (CBO Dec 2015) and HI (Trustees 2015)

Unfunded Obligations
How to Eliminate the Social Security 

Long-Term Actuarial Deficit

Make choices addressing OASDI deficits 2035-2093:

• Raise scheduled revenue after 2034 by about onethird

• Reduce scheduled benefits after 2034 by about 

one-fourth

• Or some combination of the two

13
For More Information Go To

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

• There you will find:

– This and all prior OASDI Trustees Reports

– Detailed single-year tables for recent reports

– Our estimates for comprehensive proposals

– Our estimates for the individual provisions

– Actuarial notes; including replacement rates

– Actuarial studies; including stochastic

– Extensive databases

– Congressional testimonies

– Presentations by OCACT employees

14
Additional Information
Disability Incidence Rate Projected to Rise to Ultimate Level by 2028

Sharp increase in the projected disability incidence rate in 2019 due in part to the reduction of 

the ALJ backlog.

16

3.5

4

4.5

5

5.5

6

6.5

2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027

Calendar year

2019 TR Disabled Worker Age-Sex-Adjusted Incidence Rates 

With and Without ALJ Backlog Effects

(Awards per thousand disability-exposed)

2019 TR Intermediate

Assumptions

Adjusted to Exclude

ALJ Backlog Effects
17

Employment is Closer to Full Employment

o With revised and new data, the 2019 TR full employment level is estimated to be higher in 

2017 and 2018 than was the case in 2018 TR.

o In 2019 TR, employment is estimated to reach full employment in 2022, three years sooner 

than in 2018 TR.

0.95

0.96

0.97

0.98

0.99

1

1.01

2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028

Ratio of Current Employment to Full Employment 

2019 TR

2018 TR

Historical Projected
18

Lower Unemployment Rate in the Near Term

The unemployment rate dropped to 3.7 percent in Sep. 2018, is projected to rise to around 4 

percent in 2019, and increase gradually to the ultimate value of 5.5 percent in 2023 and thereafter.

3.5

4.5

5.5

6.5

7.5

8.5

9.5

10.5

2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028

Civilian Unemployment Rate

2008 TR (no recession)

2019 TR

2018 TR

Historical Projected
19

Employment Remains Below Full Employment

o In the 2019 TR, the employment gap is projected to close sooner than in the 2018 TR.

o Unemployment rate fell below the 2018 TR projections, but is projected to rise as labor force 

participation rises.

-2

-1.5

-1

-0.5

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

3.5

4

4.5

5

5.5

6

6.5

7

7.5

8

8.5

9

9.5

10

2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028

Employment Shortfall (percent away from full employment)

Unemployment Rate (percent of labor force)

Unemployment Rate and Employment Gap

Un. rate 2008 TR 

(no recession)

Un. rate 

2019 TR

Un. rate 

2018 TR

Empl. gap 

2019 TR

Empl. gap 

2018 TR

Historical Projected
Ratio of Labor Compensation to GDP (Labor Share)

o Recent revisions to BEA data suggest slightly higher labor share since 2012.

o In the 2019 TR, the labor share of GDP is projected to reach approximately 63.2 

percent in the long-range period, about the same as in the 2018 TR.

20

0.60

0.61

0.62

0.63

0.64

0.65

0.66

0.67

1950 1960 1970 1980 1990 2000 2010 2020 2030 2040

Labor Share of GDP

2019 TR

2018 TR

Average 1950-2017 0.630

Historical Projected
21

Valuation Period—Changes the actuarial balance by -0.05 percent of payroll

Legislation etc.—Changes the actuarial balance by 0.00 percent of payroll

• Reinstatement of reconsideration step in disability appeals process 

Demographic Data/Assumptions—Changes the actuarial balance by +0.06 percent of payroll 

• Lower than expected birth rate in 2017 and near-term assumptions (- 0.02 percent)

• Higher than expected death rates in 2016 and preliminary 2017 data (+0.09 percent)

• Lower recent immigration, near-term assumptions, and other (- 0.01 percent)

data updates

Economic Data/Assumptions—Changes the actuarial balance by -0.04 percent of payroll

• Lower ultimate rate of change in labor productivity (- 0.09 percent)

• Lower assumed price differential (difference between ultimate (+0.09 percent)

growth rates for CPI-W and GDP price deflator)

• Higher long-term real-wage differential (+0.03 percent)

• Lower ultimate real interest rate (- 0.08 percent)

• Starting values and other near-term economic assumptions (+0.01 percent)

Disability Data/Assumptions—Changes the actuarial balance by +0.07 percent of payroll

• Lower recent and near-term disability applications, awards (+0.03 percent)

and incidence rates

• Lower ultimate disability incidence rate (+0.04 percent)

Methods and Programmatic Assumptions +0.01 percent of payroll

• Methodological improvements in projected benefit levels, 

programmatic data, and other improvements and updates

Reasons for Change in 2019 Trustees Report 

Actuarial Balance—Net Change of +0.06 percent of payroll
22

Changes the actuarial balance by +0.01 percent of payroll

1) Better incorporate provisional birth rate data from NCHS into fertility

model (-0.02 percent)

2) Use more comprehensive mortality data from CMS (+0.01 percent)

3) Incorporation of current year’s disability prevalence projections into labor 

force participation model (+0.02 percent)

4) Improve average benefits model to better reflect “dispersion” in historical 

taxable earnings levels (+0.04 percent)

5) Improve projection of benefit levels for those awarded benefits two or more 

years after date of initial benefit entitlement (+0.03 percent)

6) Update post-entitlement adjustment factors and the Windfall Elimination 

Provision reduction factors (-0.02 percent)

7) Other data updates and method improvements (-0.05 percent)

Detailed Methods Improvements/New Program Data 

in 2019 Trustees Report