Social Security Actuarial Status

The 2021 Annual Report of the Board of Trustees 

of the OASI and DI Trust Funds

Key Changes and Results Under Intermediate Assumptions

STEVE GOSS, CHIEF ACTUARY, SOCIAL SECURITY ADMINISTRATION

SOCIAL SECURITY ADVISORY BOARD

PUBLIC SESSION ON SOCIAL SECURITY’S FINANCIAL OUTLOOK

SEPTEMBER 3, 2021
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 would fall short 

under current law, indicating the size of legislative changes that 

will be needed

2
Changes This Year Due to Pandemic/ 

Recession

The projections in the 2021 Trustees Report include the Trustees’ best estimates of the effects of the 

COVID-19 pandemic and ensuing recession, which were not reflected in the 2020 report

1. Lower employment and earnings in the near term, through 2023

However, the average wage index increases by about 2.7% for 2020

2. Increased deaths in 2020 through 2023

3.Delays in births and immigration

4. Lower applications for benefits, particularly disability

5.A permanent loss in the level of worker productivity, as in other 

recessions

3
Primary Changes This Year: Longer Term

1. Birth rates: change to projecting by “cohort” rather than by year

a) Reflects the continuing trend for women having children at older ages

b) Lower annual birth rates through 2036, reaching ultimate 2.0 in 2056

2. Employment: Updated labor force model to include latest economic cycle

a) Lower labor force and unemployment rate with little net effect

3. Death rates: added dementia as a category and reduced rates of improvement 

for cardiovascular disease

4. Lower revenue from taxation of benefits per recent experience (Treasury OTA)

5. Methods changes, primarily for average benefit levels

4
Changes in Timing of Trust Fund Reserve 

Depletion

Mainly from the pandemic/recession in the first 10 to 20 years

1.OASDI reserve depletion is 2034, one year earlier than last 

year’s report. 

2.OASI reserve depletion is 2033, one year earlier than last 

year’s report.

3.DI reserve depletion is 2057, 8 years earlier than last 

year’s report.

a) Change is larger because difference between cost and income is smaller and 

more similar in years after 2030

5
Changes in OASDI Actuarial Balance

in 2021 Report

•Valuation Period - 0.06 percent

•Legislation (restore and maintain the DACA program) - 0.01 percent

•Demographic data, assumptions and methods - 0.01 percent • New cohort fertility method and higher ultimate fertility rate (roughly offsetting cost effects) • New dementia cause of death category • Higher recent and projected near-term mortality due to COVID-19 pandemic

•Economic data, assumptions and methods - 0.09 percent • Updated labor force projection model and lower ultimate unemployment rate

• Slightly faster real growth in average wage levels • Lower near-term real interest rates • Level of productivity and GDP permanently lowered by 1 percent due to recession

• Reduced level of revenue from taxation of benefits

•Other new data and methods improvements - 0.16 percent

Net Changes for All Reasons -0.32 percent

6
Comparison of Effects: Including OCACT Update

On November 24, 2020, we published a memo with our preliminary estimates of the effects 

of the COVID-19 pandemic and ensuing recession. See details at

https://www.ssa.gov/OACT/solvency/UpdatedBaseline_20201124.pdf

7
Solvency: OASI+DI 

Trust Fund Reserve 

Depletion in 2034 

(one year earlier than last year)

Reserve depletion date varied 

from 2029 to 2042 in reports 

over the past 30 years (1992-

2021).

DI Trust Fund: reserve depletion 

in 2057, eight years earlier than 

last year.

Due largely to less revenue 

being projected for the DI 

program in the near-term. DI 

program continues to have low 

recent and near-term disability 

applications and awards.

8

0%

50%

100%

150%

200%

250%

300%

350%

400%

450%

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065

Calendar Year

Social Security Trust Fund Ratios

Assets as a Percent of Annual Cost

Trustees Report Intermediate Projections

2021 TR DI

2020 TR DI

2021 TR OASI

2020 TR OASI

2021 TR OASDI

2020 TR OASDI

Historical Projected

Tax Rate

Reallocation
OASDI Annual Cost 

and Non-Interest 

Income as Percent 

of Taxable Payroll

Persistent negative annual 

cash-flow balance starting in 

2010.

78 percent of scheduled 

benefits still payable at trust 

fund reserve depletion.

Annual deficit in 2095: 4.34 

percent of payroll: 0.21 

percent smaller than last 

year

9

0%

5%

10%

15%

20%

25%

2005 2015 2025 2035 2045 2055 2065 2075 2085 2095

Calendar Year

OASDI Non-Interest Income, Cost and Expenditures 

as Percentages of Taxable Payroll

Cost: Scheduled and 

payable benefits

Cost: Scheduled but not fully 

payable benefits

Non-interest Income Expenditures: Payable benefits = income 

after trust fund depletion in 2034

Payable benefits as percent 

of scheduled benefits:

2020-33: 100%

2034: 78%

2095: 74%

Historical Projected
Changes in 

OASDI Annual 

Balance

Annual income rate minus 

annual cost rate.

The trends in the very near term 

are due to the recession and 

recovery.

The increased annual deficits 

between 2025 and 2090 are 

mainly due to lower birth rates 

through 2036, reduced 

productivity, reduced revenue 

from taxation of benefits, and 

changes in benefit projection 

methods.

The reduction in annual deficits 

after 2080 is largely due 

attaining the ultimate fertility 

rate in 2056.

10

-6%

-4%

-2%

0%

2%

2015 2025 2035 2045 2055 2065 2075 2085 2095

Calendar Year

OASDI Annual Balances: 2020 and 2021 Trustees Reports

2020 Report

2021 Report
SUSTAINABILITY: 

Cost as percent 

of GDP

Rises from a 4.2 percent 

average in 1990-2008, to a 

peak of about 6.2 percent for 

2077, and then decline to 5.9 

percent by 2095.

11

0%

1%

2%

3%

4%

5%

6%

7%

8%

1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090

Calendar Year

OASDI Cost and Non-Interest Income as a Percentage of GDP

Historical Projected

Cost

Non-interest Income
Aging - Change 

in Age 

Distribution

Mainly due to drop in 

birth rates

12

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 2021 TR

Population 65+/(20-64) 

Actual and TR Intermediate

TFR remains at 3.0 after 1964

TFR remains at 3.3 after 1964

Historical Projected
Birth Rates by 

Cohort

Has been rising for 

women born since 

1951. 

Projected to dip below 

2.0 for women born 

between 1990 and 

2006, based on low 

rates since 2008.

13

Chart 1.4: Historical and Projected Total Fertility Rates by Birth Cohort

https://www.ssa.gov/oact/TR/2021/2021_Long-Range_Demographic_Assumptions.pdf
Mortality 

Experience: All 

Ages

Increased mortality in 

the near-term to reflect 

the effects of the 

COVID-19 pandemic.

14

700

750

800

850

900

950

1,000

1,050

1,100

1990 1995 2000 2005 2010 2015 2020 2025

Age-Sex-Adjusted Death Rates (per 100,000)

Total, All Ages

2019TR 2020TR 2021TR Actual
Ratio of 

Employment to 

Population

Expected to recover fully from 

the brief but steep recession. 

Expected to rise to same 

overall level as in the 2020TR. 

Under the new labor force 

model, difference between 

men and women narrowed 

somewhat. Slightly lower 

LFPR is offset by lower 

expected average 

unemployment rate, 

consistent with recent 

experience.

15

0.45

0.50

0.55

0.60

0.65

0.70

0.75

1981 1991 2001 2011 2021 2031 2041 2051 2061 2071 2081 2091

Ratio of Employment to Population 

(16 and older, age-sex-adjusted to 2011 population)

2020 TR

2021 TR

Age-sex-adjusted

Men (age-adjusted)

Women (age-adjusted)

Historical Projected
Lower Potential 

GDP in 2021 TR 

Compared to 

2020 TR

Potential GDP is roughly 1 

percent lower than the level 

in the 2020 TR.

Reflects expectation of a 

permanent level shift due to 

effects of the recession on 

total economy labor 

productivity and size of the 

population ages 16+.

16

12,000

14,000

16,000

18,000

20,000

22,000

24,000

26,000

2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029

Potential GDP

(billions of 2012 dollars, intermediate assumptions)

2010 TR

2020 TR

2021 TR

Historical Projected
Disabled Worker Receipt Rates (at DDS) have Been 

Dropping Since 1990 at Older Ages, and at All Ages Lately

17

0

1

2

3

4

5

6

7

1990 1995 2000 2005 2010 2015 2020

Receipts per 1,000 exposed

Fiscal year

Male Title II Disabled Worker DDS Receipt Rates

by 5-Year Age Groups per 1,000 exposed

60-64

55-59

50-54

45-49

35-44

25-34

Under 25

0

1

2

3

4

5

6

7

1990 1995 2000 2005 2010 2015 2020

Receipts per 1,000 exposed

Fiscal year

Female Title II Disabled Worker DDS Receipt Rates 

by 5-Year Age Groups per 1,000 exposed

60-64

55-59

50-54

45-49

35-44

25-34

Under 25
Applications for 

Disability 

Benefits Remain 

Historically Low

At the peak of the last 

economic cycle in 2007, 

applications were low, but 

increased rapidly in the 2008 

recession from 1.5 million in 

2007 to 1.9 million in 2010.

In 2016 through 2020, 

applications have dropped 

below the 2007 level.

18

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029

(millions)

Social Security Disabled Worker Receipts at Disability Determination 

Services by Calendar Year: Historical and Intermediate Assumptions 

for 2012 through 2021 Trustees Reports

2012TR

2017TR

2016TR

2015TR

2014TR

2013TR

2018TR 2019TR

2020TR

2021TR
Disability 

Incidence Rate 

Also Remains 

Historically Low

DI disabled worker incidence 

rate rose sharply in the 2008 

recession, and has declined 

since the peak in 2010 to 

extraordinarily low levels in 

2016 through 2020.

19

3.5

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 2021 Trustees Report

2012TR

2013TR

2014TR

2015TR

2016TR

2017TR

Average 1990-2020 5.10

Ultimate Assumption 5.00

2018TR

2019TR

2020TR

2021TR
Fewer Disabled 

Worker 

Beneficiaries

Fewer now and in near 

term based on recent 

applications and 

incidence rates.

20

6,000

7,000

8,000

9,000

10,000

11,000

2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028

Calendar Year

Disabled Worker Beneficiaries

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

2008 TR (no recession)

2020 TR

2021 TR
How to Eliminate the Social Security 

Long-Term Actuarial Deficit

Make choices addressing OASDI shortfall 2034-2095:

•Raise scheduled revenue after 2033 by about one-third

•Reduce scheduled benefits after 2033 by about one-fourth

•Or some combination of the two

21
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 and individual provisions

• Actuarial notes; including replacement rates

• Actuarial studies; including stochastic

• Extensive databases

• Congressional testimonies

• Presentations by OCACT employees

22