Testifying before the Senate Finance Committee on Thursday, July 15, Stephen Goss, chief actuary of the Social Security Administration, said that encouraging Americans to "work longer and be more productive can potentially contribute to meeting the financial challenges that lie ahead" as Americans live longer in general, as the population experiences the result of "the permanent declines in the birth rate since 1965," and as the baby boomers move from "working age to retirement age."
The demographic impact of these changes is most clear from the Social Security program itself, Goss suggested: "We have had about 3.3 contributing workers for each beneficiary from 1975 to 2008. By 2035, we project that we will have only about 2 contributing workers for each beneficiary." Goss said that more than SSA will be affected by these changes, arguing that "a large and permanent change in the age distribution of our population that will challenge all aspects of our economy."
As for the specific topic of the hearing before the Committee led by Senators Max Baucus (D-Montana) and Charles Grassley (R-Iowa)–"Choosing to Work During Retirement and the Impact on Social Security"–Goss said the SSA's 2009 Trustees Reports projects that "the productivity of our workforce will continue at the historic rate of the past 40 years on the assumption that improvements in technology will offset the expected slowdown in the rate of increase in educational attainment. The reports also assume that workers will tend to work longer as life expectancy and health improve. Offsetting this assumption is the expectation that disability prevalence will continue to climb somewhat in the future. Overall, the Trustees project that labor force participation will not change substantially from recent levels under current policy."
Goss then laid out three hypothetical scenarios "for increased labor force participation in the future beyond what the Trustees project under current law and policy."
