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The worldwide question of the week: How will future generations pay to care for the current ones?
Look at these stories from the week:
They’re all part of the same human story.
After reading about the major worldwide implications of China’s shrinking population, I called a top US demographer to learn about what’s happening with the population here at home.
My conversation with William Frey, a senior fellow at the Brookings Institution, went much further than a comparison of the two countries. Excerpts are below.
(Note: If you’re not that interested in demography, skip to the end for what he says about US immigration. That’s the major takeaway for Americans and, according to Frey, one key to a stronger American future.)
China’s shrinking population was completely predictable
WOLF: You’re a US-focused demographer. What’s your immediate reaction to the news that China’s population has shrunk or is shrinking?
FREY: I think a lot of people have known this for quite a while. You don’t have to be a very skilled demographer to understand what the one-child policy over those many years meant in terms of the aging of a population.
As you have fewer young people, that makes the population eventually pretty top heavy. And in addition, you have lowered growth. But as the population ages, there are proportionately fewer women in their childbearing ages. And add on to that the strong restrictions toward fertility.
Just a few years of higher fertility, which they’ve had in the last few years, is far from enough to counter what happened in those many years with a strict policy.
I’m not surprised, either by the decline in the population or the aftermath, which is the strong aging of the Chinese population.
Why Americans are having fewer children
WOLF: Compare, if you could, the news about China with what we’ve learned about the US from the recent census.
FREY: The recent census has shown we’ve had the second slowest growth in our population over a decade in our history.
The first was during the 1930s when we had the Great Depression. A lot of that is due to the lower fertility that we’ve had over time. And this is a natural occurrence over the course of a developed country, because more women go into the labor force, put off having children, maybe wind up having fewer children as they put their careers or their work lives ahead of immediate childbearing for a while.
In particular, the last decade has been especially difficult because a lot of the young millennial population has been trying to get over that Great Recession of 2007 to 2009 – and this will spill over into the next decade as this last decade helped to reduce the fertility in the United States.
Only a little bit of the census numbers had anything to do with the pandemic. The census was taken in April of 2020. The pandemic just began around then, although I think some of the estimates that we’ve seen since the census show that the fertility has continued to not do well, especially over those peak pandemic years.
There’s been a slight uptick since the very bad earlier period, and of course, a very large number of (pandemic-related) deaths that we weren’t expecting.
Add to that immigration, which started to go down a little bit in the 2010s decade, especially since the restrictions that were put in during the Trump administration.
The new data that just came out a few weeks ago shows that immigration has sprung up again in the last year. So that’s good news.
We look at that 2010s decade; the very low population growth that we’ve had is a combination of long-term trends, very period-specific economic factors and then immigration restrictions. Put all that together and we’ve had somewhat lower population growth.
Why are some states’ populations shrinking?
WOLF: In that 2020 data, there were several states, like Illinois, West Virginia and Mississippi, where the population shrank over the course of 10 years. Do you expect that will grow to more states? Is the US on the road to a shrinking population like China?
FREY: No, the US isn’t dealing with a shrinking population like China.
I think we’re going to continue to have growth, but much slower growth. These last few years, the pandemic created very slow growth, almost flat growth. The calendar year, I guess it would have been July 2020 to July 2021 – we only had like 0.1 to 0.2% growth during that period.
We’re not going to have that. We won’t go down to that. We’re going to continue to move up.
When you look at a particular state, whether it’s Illinois or West Virginia, or some other state, the wild card with those cases is not just fertility and mortality, but domestic migration – people moving around the United States.
States like Texas and Florida have been attracting a lot of domestic migrants for either economic reasons, job reasons, amenity reasons. States like West Virginia, and more recently, Illinois, have had bigger domestic out-migration.
It’s true that nationally, we have lower growth in general because we have lower fertility, higher deaths and lower immigration. That makes things even worse for these out-migration states.
The rising tide lifts all boats when immigration comes up, when fertility comes up and mortality goes down. So I’m expecting a little bit of a cushion in the next few years as we come out of the pandemic economy. But nothing like the very high growth years that we saw for decades prior to this last decade.
Key populations are keeping the US young
WOLF: You had some interesting analysis of the 2020 data that shows not so much the US population is shrinking, as you’ve just described, but that it’s changing remarkably. How is it changing?
FREY: One of the ways it’s changing is the profile of the United States population. The growing parts of our population are not non-Hispanic Whites – to US Census terminology, those are people who identify as White but not as Hispanics and not as people of other races. That population has been declining, especially among the younger part of the population, under age 18.
Most of the growth of our population is from people of color – especially Latinos by numeric growth and Asians in percentage growth – and other groups as well. The Black population is growing, although not as fast as those other groups.
The other part of that is the growth of those people-of-color populations is much more dominant in the younger part of the population. Already the 2020 census shows there’s a minority White population among our children, those people under age 18.
That means, of course, 10 years from now, people who are in their 20s are going to be in that situation. We’re going to be a much more racially diverse country than we’ve ever been before.
The Whitest parts of our population, of course, are the senior population, baby boomers and people that are older than baby boomers. That’s simply because immigration and the children of immigrants and the younger population that’s associated with Latinos and Asians, whether they be second- or third-generation Americans, tend to be younger.
That’s making our country more youthful and, getting back to our earlier discussion, the reason we’re not aging as rapidly as many other countries – not just China, but a lot of countries in Europe, as well – is because we’ve had several decades of immigration and the children of immigrants and the grandchildren of immigrants helping to make our country younger than it would have been if we had not had them.
Debt, the safety net, immigration – it’s all related
WOLF: That allows me to pivot to something else. The big policy discussion in Washington is on the national debt. And there soon will be discussions on things like Social Security and Medicare and how and whether to trim those. What are your thoughts on how the changing population will affect our safety net?
FREY: You have to talk to someone who’s an actuary to look at what’s going on with when exactly the Social Security Trust Fund is going to melt down.
But the idea is that we’re going to have a growing older population and at the same time we’re going to have a much more modestly gaining working-age population or child population going forward, at least for the next 20 or 30 years.
As all the baby boomers move into those older age groups – the baby boomers are this huge puff of people that are getting older, more than half of the baby boomers are already over age 65 and the rest of them will be there by 2030 – what that means is people are going to work a little longer than age 65, probably, as they move into those ages.
It still means there will be a fair number of people who will be dependent on Social Security, Medicare and those kinds of government funding for their own well-being. As the younger part of the population does not grow as rapidly, it means there’s more of a strain on them, or at least a different kind of dependency that needs to be put between the younger generation and the older generation.
It’s kind of interesting that a lot of older baby boomers, politically, tend to be against immigration as an issue. For a variety reasons, the surveys show they think it’s changing the country in a negative way, you’re changing the culture of the country or something like that.
But a lot of them are going to be very dependent on these younger people as they move into retirement and need those kinds of services. I wonder if these young people are going to have the same kind of attitude about that older generation or when they’re asked to be able to support them in the future.
Will everyone have to work longer?
WOLF: And something we also see right now in France, where they’re trying to raise the retirement age – is this going to be a worldwide issue?
FREY: Most countries we call developed countries, industrialized countries have this kind of aging phenomenon occurring.
We’re in a somewhat better position than some European countries because we did have that healthy immigration in the last several decades, especially the ’90s to the early 2000s and beginning this last decade – not the end of this last decade.
I think a lot of these other countries are going to have to deal with that. Countries like France and other European countries have stronger government support for older people than we do in many ways, and so the burden is probably even more difficult there in how they’re going to deal with it.
We have changed, in the US, the retirement age a little bit in the past and moved it up a little bit. There may be discussions about that.
With numbers of people come numbers of voters. And as more older people get into those age groups, it’s not going to be a very popular political position to say we’re going to restrict the Social Security in various ways.
What will the US look like in the more distant future?
WOLF: We’re talking about the immediate trends. I wonder what you think the long-term population trend will be. What’s the US going to look like 100 or 150 years from now?
FREY: That’s a very hard thing to predict. I think the wild card for us, in terms of how we predict and what we predict, is immigration.
If we just started from a standard demographic standpoint – if you start with today’s population in age and sex and race structure – there are various ways that you can project ahead what the future size of the population will be, what the future age composition of the population will be.
The wild card is not that standard base population that I just described. How many immigrants are going to be coming into that group? We have a great opportunity in this country, because so many people want to come here from all parts of the world – from rich countries to poor countries – to be able to use immigration as a tool to shape our demography going forward.
There are all these commissions in the White House. There really should be a demographic commission that deals, among other things, with immigration.
Seriously. Immigration has become a political football. Nobody talks about it seriously in terms of congressional legislation, and if they do, it never passes. It’s become a kind of a cultural thing.
People really need to understand this demography – how we would have been aging without the last several decades of immigration and how we would be aging rapidly in the future if we don’t come back. Understand what immigration policy might mean for keeping our age structure reasonable and not that high degree of age dependency.
Have ideas about immigration policy, of how people can contribute to the country’s economy, to its society – and serious discussion, rather than making it just a political back and forth.
