The Economic Problem of Population Ageing

The population growth of Americans age 65 and older is 112% in the years between 1995 and 2040. The population growth in age 20-64 is 24%. The population growth in ages under 20, is 5%. What these numbers essentially represent is a cause problem with age differences in the future. Soon, less workers will be in the job force trying to supply more retirees with Social Security.

Country: A nation with its own government, occupying a particular territory. Explanation: The world is said to reach a population of 9.2 billion people in 2050. The economy of a country is affected in multiple ways; one of the factors affecting the progression of an economy is the life expectancy. In the past decade, the sizes of families are decreasing due to many reasons such as low fertility rates, economic reasons, high education, and etc. causing an increase in the elderly population.

Introduction Since the year 1800, the global population has grown from one billion to the estimated current population of 6.5 billion. By the year 2070 the world’s population is expected to continue to grow to 10 billion people. The major increase in population has occurred in the past 50 years, and based upon the United Nations (2007) estimates and projections up to the year 2050, it is believed that the population burst experienced worldwide over the past half century will have slowed down in the northern and contemporary countries, whereas the population will continue to increase in less developed countries and southern nations. While the large population is taxing enough on the already fragile economic markets of the United Kingdom, the fact that this population is rapidly ageing and will rely heavily on the British Welfare State is of concern. Through the examination and use of both printed and online sources, the population trends and their causes are presented, and the impact on, and implications for, the British welfare state are discussed.

In 2013, the tax is 12.4 percent and the cap is $113,700, for a maximum tax of about $14,000. More than two dozen countries have moved to retirement systems based on personal accounts. Personal accounts have long been discussed as a superior alternative to the current pay-as-you-go Social Security system. Personal accounts would also encourage greater work effort and thus boost economic growth. Tax increases are not the answer to solve America 's problem of overpromised elderly entitlement programs.

Furthermore, they heighten the fertility rate in the country they immigrate. Unfortunately, migration alone cannot erase the looming danger of an ageing population. Yet, it certainly can slow the process down (Harper). Nevertheless, specialists expect an increase of retired people over 65 years by 35% to 50% during the next 20 years. In this case, contribution rates by the working forces would have to rise significantly from its current rate of 13% to over 18% in the United Kingdom.

By the year 2050, for the first time in history, the population of those 60 and older will outnumber the population of those aged 15 and younger (Gelineau, 2013). What does this mean for the nation? What does this mean for the world? But, most importantly what does it mean for those that are aging without the needed resources from the countries they live, as the global study issued by the United Nations in 2013 describes (Zaidi, 2013). Due to various technology advancements and the older generations learning to better take care of themselves, the aging population is growing at an exponential rate.

The Ageing of the American Population Of the total federal expenditures in 1995, Social Security together with Medicare(federally founded health program aimed at helping the elderly, founded in 1965) was the largest, accounting for about 34 percent. In 2005 this figure is predicted to be as high as 39 percent. This is caused by the "graying" of America and the increased number of elderly who will collect benefits for a longer portion of their lives, coupled with a reduction of the number of workers available to pay for their benefits. Increasing costs of living and higher standards of living (as reflected in higher wages) also are consequences. In short, if no action is taken in the interim, by approximately 2013 the federal government will have to raise taxes, increase the debt, print more money, reduce Social Security benefits immediately, or do some combination of those things to rectify the Social Security cash-flow imbalance.

One method of preventing this shortage is to remove the barriers that limit the expansion of the health care provider supply. The U.S. population is getting older: the Census Bureau reported the population of people less than 45 years old dropped from 65.6% in 2000 to 60.5% in 2010. While the percent of people 65 years and over increased by 15% between 2000 and 2010 (US Census, 2011, p.2). Age is associated with increased health care demand. Over 56% of people 65+ and 65% of people 75+ make four or more visits to health care professionals.

While there has been a recent slowdown in health care and thus Medicare spending over the last decade, there was an acceleration in health spending growth during 2013 which suggests that the long, slow, downward effects of the recession on health spending may have finally bottomed out (Schwartz, 2014). Taken together, increased enrollment and increasing health care spending growth is a great concern to policy makers. Not only are Medicare expenditures projected to double to more than $1 trillion by 2023 (Kaiser Family Foundation, 2013), but at this level of growth, there is broad concern that Medicare spending will crowd out spending on investments like education, research and development, and infrastructure. As such, policy makers are looking for ways to lower per-capita Medicare costs and save money. Policy Solution One such solution that has been proposed to create savings within Medicare is to impose limits on “Medigap.” Medigap is the supplemental coverage that provides Medicare beneficiaries with financial protection for the things that Medicare doesn’t pay for, like the Medicare deductibles and copayments that beneficiaries would otherwise pay out of pocket.

This means that the percentages of qualified, able, and willing to work number of people has risen steadily over the last decade. The decade ends with a sharp rise of unemployment compared to the early years of the decade. The steady increase in unemployment rates have been attributed to a number of reasons. Some of them include: Economic recession Economic recession is a sphere financial crisis which affects the economic performance of a country (Visual economics). According to the chart, the unemployment rates in the Un... ... middle of paper ... .../publications/detail/crisis-economics Mathzone, (2011).