The footprints of an aging America are everywhere. Every day it seems another blue chip report is issued worrying about the surging ranks of the elderly. All boomers will be 65 and older by 2030. (The Rolling Stones’ memorable line “What a drag it is getting old” hurts, doesn’t it?) Put somewhat differently, 19.3 percent of the population will be at least 65 in 2030, up from 13 percent in 2010, according to U.S. Census Bureau projections. The litany of fears that goes along with an aging population ranges from a rising tide of entitlement spending starving the public purse of money for productive investments, to Corporate America’s innovative energies being depleted along with graying hair and aching joints of an older workforce.
Demographics, however, aren’t destiny. Instead, an aging America is an underappreciated and unexploited economic resource in a highly competitive global economy. Take Europe vs. the U.S. In many parts of Europe there isn’t the kind of part-time, flexible work that’s available in the U.S., where federal laws have outlawed employment discrimination against age since the 1960s. Most European countries have only recently instituted such legislation. And Europe is still struggling to convince workers to stay on the job longer. The U.S. labor force participation rate of older male workers began climbing by the end of the 20th century. Older women are remaining employed longer, too. “Yes, America has an aging population,” says Nicole Maestas, economist at the Rand Corp., the Santa Monica (Calif.)-based think tank. “The upside of that is a whole generation of people who are interested in anything but retirement.”
Productivity matters more than demographics. For example, a half-century ago there were about five workers for every retiree, a figure that has shrunk to less than 3 to 1. Yet over the same time period, American living standards have risen smartly, thanks largely to productivity growth. If productivity continues to run at its current nearly 2.5 percent annual rate, the average worker will produce more than twice as much in an hour of work 30 years from now compared with today, points out Dean Baker, codirector of the Center for Economic and Policy Research in Washington.
Taken altogether, an aging workforce is a competitive advantage. Instead of bemoaning America’s older population, policymakers and corporate chieftains should concentrate on keeping them productively on the job longer. In international comparisons, the U.S. has long garnered admiration for its productive workforce, innovative companies, superb universities, and dynamic labor market. It’s time to add older workers to that list. Read more: Bloomberg Businessweek