2014 OASDI Trustees Report

V. ASSUMPTIONS AND METHODS UNDERLYING
ACTUARIAL ESTIMATES

The future income and cost of the OASDI program will depend on many demographic, economic, and program-specific factors. Trust fund income will depend on how these factors affect the size and composition of the working population as well as the level and distribution of earnings. Similarly, program cost will depend on how these factors affect the size and composition of the beneficiary population as well as the general level of benefits.

The Trustees make basic assumptions for several of these factors based on analysis of historical trends, historical conditions, and expected future conditions. These factors include fertility, mortality, immigration, marriage, divorce, productivity, inflation, average earnings, unemployment, real interest rate, and disability incidence and termination. Other factors depend on these basic assumptions. These other, often interdependent, factors include total population, life expectancy, labor force participation, gross domestic product, and program-specific factors. Each year the Trustees reexamine these assumptions and methods in light of new information and make appropriate revisions. The Trustees selected the assumptions for this report by the end of January 2014.

Future levels of these factors and their interrelationships are inherently uncertain. To address these uncertainties, this report uses three sets of assumptions, designated as intermediate (alternative II), low-cost (alternative I), and high-cost (alternative III). The intermediate set represents the Trustees’ best estimate of the future course of the population and the economy. With regard to the net effect on the actuarial status of the OASDI program, the low-cost set is more optimistic and the high-cost set is more pessimistic. The low-cost and high-cost sets of assumptions reflect significant potential changes in the interrelationships among factors, as well as changes in the values for individual factors.

While it is unlikely that all of the factors and interactions will differ in the specified directions from the intermediate values, many combinations of individual differences in the factors could have a similar overall effect. Outcomes with overall long-range cost as low as the low-cost scenario or as high as the high-cost scenario are very unlikely. This report also includes sensitivity analysis, where factors are changed one at a time (see appendix D), and a stochastic projection, which provides a probability distribution of possible future outcomes that is centered around the intermediate assumptions (see appendix E).

Readers should interpret with care the estimates based on the three sets of alternative assumptions. These estimates are not specific predictions of the future financial status of the OASDI program, but rather a reasonable range of future income and cost under a variety of plausible demographic and economic conditions.

The Trustees assume that values for each of the demographic, economic, and program-specific factors change toward long-range ultimate values from recent levels or trends within the next 25 years. For extrapolations beyond the 75‑year long-range period, the ultimate levels or trends reached by the end of the 75‑year period remain unchanged. The assumed ultimate values represent average annual experience or growth rates. Actual future values will exhibit fluctuations or cyclical patterns, as in the past.

The following sections briefly discuss the various assumptions and methods required to make the estimates of trust fund financial status, which are the heart of this report.¹ There are, of course, many interrelationships among these factors that make a sequential presentation potentially misleading.

A. DEMOGRAPHIC ASSUMPTIONS AND METHODS

Table V.A1 displays the principal demographic assumptions relating to fertility, mortality, and net immigration for the three alternatives.

1. Fertility Assumptions

Birth rates by single year of age, for women aged 14 to 49, are the basis for the fertility assumptions. These rates apply to the total number of women, across all marital statuses, in the midyear population at each age.

Historically, birth rates in the United States have fluctuated widely. The total fertility rate² decreased from 3.31 children per woman at the end of World War I (1918) to 2.15 during the Great Depression (1936). After 1936, the total fertility rate rose to 3.68 in 1957 and then fell to 1.74 by 1976. After 1976, the total fertility rate began to rise again until it reached a level of 2.07 for 1990. From 1991 to 2006, the total fertility rate averaged 2.03 children per woman. Then, the total fertility rate dropped from 2.12 in 2007 to 1.89 in 2011 and, based on preliminary data, to 1.88 in 2012. The recession and high unemployment are likely reasons for this drop. The estimated total fertility rate for 2013 is 1.89.

These variations in the total fertility rate resulted from changes in many factors, including social attitudes, economic conditions, birth-control practices, and the racial/ethnic composition of the population. The Trustees expect future total fertility rates to remain close to recent levels. Certain population characteristics, such as the higher percentages of women who have never married, of women who are divorced, and of young women who are in the labor force, are consistent with continued lower total fertility rates than experienced during the baby-boom era (1946-65). Based on consideration of these factors, the Trustees assume ultimate total fertility rates of 2.30, 2.00, and 1.70 children per woman for the low-cost, intermediate, and high-cost assumptions, respectively. These ultimate rates are unchanged from last year’s report.

For the intermediate alternative, the projected total fertility rate rises until 2021 when it reaches 2.07. This reflects the assumption that fertility rates will have a recovery from their current recession-depleted levels. The Trustees then assume the total fertility rate follows a gradual trend toward the ultimate level in 2038. The Trustees assume the low-cost and high-cost total fertility rates gradually trend away from the intermediate path to reach the ultimate values in 2038.

2. Mortality Assumptions

The Office of the Chief Actuary at the Social Security Administration develops average percentage reductions in future mortality rates by age group, sex, and cause of death. The office uses these percentages to estimate future central death rates by age group, sex, and cause of death. From these estimated central death rates, the office calculates probabilities of death by single year of age and sex.

The Office of the Chief Actuary calculated historical death rates for years 1900‑2010 for ages below 65 (and for all ages for years prior to 1968) using data from the National Center for Health Statistics (NCHS).³ For ages 65 and over, the office used final Medicare data on deaths and enrollments for years 1968 through 2010 and preliminary data for 2011. The office produced death rates by cause of death at all ages for years 1979‑2010 using data from the NCHS.

The total age-sex-adjusted death rate⁴ declined at an average annual rate of 1.07 percent between 1900 and 2010. Between 1979 and 2010, the period for which death rates were analyzed by cause, the total age-sex-adjusted death rate, for all causes combined, declined at an average rate of 0.99 percent per year.

Death rates have declined substantially in the U.S. since 1900, with rapid declines over some periods and slow or no improvement over the other periods. Historical death rates generally declined more slowly for older ages and more rapidly for children than for the rest of the population. Between 1900 and 2010, the age-sex-adjusted death rate for 65 and over declined at an average rate of 0.79 percent per year, while declining at an average rate of 3.13 percent per year for ages under 15.

Many factors are responsible for historical reductions in death rates, including increased medical knowledge, increased availability of health-care services, and improvements in sanitation and nutrition. Considering the expected rate of future progress in these and other areas, the Trustees assume three alternative sets of ultimate annual percentage reductions in central death rates by age group and cause of death, for 2038 and later. The intermediate set, alternative II, represents the Trustees’ best estimate. The average annual percentage reductions for alternative I (low-cost) are smaller than those for alternative II, while those for alternative III (high-cost) are larger. These ultimate annual percentage reductions are the same as those in last year’s report.

For the years 2011 through 2013, the assumed annual reductions in central death rates are the same as the average annual reductions by age group, sex, and cause of death experienced between 2000 and 2010. After 2013, annual reductions in central death rates for alternative II are assumed to transition rapidly from the trend experienced between 2000 and 2010, until they reach the ultimate annual percentage reductions for 2038 and later. The assumed reductions in death rates under alternatives I and III also rapidly approach their ultimate levels, but start from levels which are, respectively, 50 and 150 percent of the corresponding alternative II level.

Table V.A1 contains historical and projected age-sex-adjusted death rates for the total population (all ages), for ages under 65, and for ages 65 and over. Age-sex adjustment eliminates the effect of a changing distribution of population by age and sex, allowing the pure effects of changes in death rates to be observed. The level of these age-sex-adjusted death rates is substantially higher than the level shown for the age-sex-adjusted death rates in last year’s report due to the change in the “standard” population used for age-sex adjusting. For last year’s report, this standard population was the enumerated resident population as of April 1, 2000. For this year’s report, the standard population is the enumerated resident population as of April 1, 2010. This change in the standard population for age-sex adjusting has very little effect on the rates of improvement. If there had been no change in the standard population used for age-sex adjusting, then the level of projected age-sex-adjusted death rates would be similar to the level shown in last year’s report.

The projected average annual rate of decline for the total age-sex-adjusted death rate is about 0.41 percent, 0.79 percent, and 1.20 percent between 2013 and 2088 for alternatives I, II, and III, respectively. In keeping with the patterns observed in the historical data, the assumed future rates of decline are greater for younger ages than for older ages, but to a substantially lesser degree than in the past. Accordingly, the projected age-sex-adjusted death rates for ages 65 and over decline at average annual rates of about 0.37 percent, 0.71 percent, and 1.07 percent between 2013 and 2088 for alternatives I, II, and III, respectively. The projected age-sex-adjusted death rates for ages under 15 decline at average annual rates of about 0.78 percent, 1.56 percent, and 2.57 percent between 2013 and 2088 for alternatives I, II, and III, respectively.

Demographers express a wide range of views on the likely rate of future decline in death rates. For example, some believe that the long-standing historical tendency for mortality to decline more slowly at the highest ages will cease in the future. Others believe that biological factors, social factors, and limitations on health care spending may slow future rates of decline in mortality. The 2011 Technical Panel on Assumptions and Methods, appointed by the Social Security Advisory Board, believed that ultimate rates of decline in mortality will be higher than the rates of decline experienced for sustained periods of time in the past or assumed for the intermediate projections in this report. Evolving trends in health care and lifestyle will determine what further modifications to the assumed ultimate rates of decline in mortality will be warranted for future reports.

3. Immigration Assumptions

In order to develop projections of the total Social Security area population, the Trustees make assumptions for annual legal immigration, legal emigration, “other immigration,” and “other emigration.” Legal immigration consists of persons who are granted legal permanent resident status. Legal emigration consists of legal permanent residents and citizens who leave the Social Security area population. Net legal immigration is the difference between legal immigration and legal emigration. “Other immigration” consists of immigrants who enter the Social Security area in a given year and stay to the end of that year without having legal permanent resident status, such as undocumented immigrants and temporary foreign workers and students. “Other emigration” consists of other immigrants who leave the Social Security area population or who adjust their status to become legal permanent residents. Net other immigration is the difference between other immigration and other emigration. Net immigration refers to the sum of net legal immigration and net other immigration.

The Trustees make separate assumptions for the low-cost, intermediate, and high-cost scenarios. The low-cost scenario includes higher annual net immigration and the high-cost scenario includes lower annual net immigration.

Legal immigration increased after World War II to around 300,000 persons per year and remained around that level until shortly after 1960. With the Immigration Act of 1965 and other related changes, annual legal immigration increased to about 400,000 and remained fairly stable until 1977. Between 1977 and 1990, legal immigration once again increased, averaging about 580,000⁵ per year.

The Immigration Act of 1990, which took effect in fiscal year 1992, restructured the immigration categories and increased significantly the number of immigrants who may legally enter the United States. Legal immigration averaged about 780,0001 persons per year during the period 1992 through 1999. Legal immigration increased to about 895,000 in 2000 and about 1,060,000 in 2001, primarily due to an increase in the number of persons granted legal permanent resident status as immediate relatives of U.S. citizens, the only category of legal immigration that is not numerically limited. However, legal immigration declined to less than 770,000 by 2003 as processing slowed and the number of pending applications increased. From 2003 to 2006, processing accelerated and legal immigration increased until it reached about 1,215,000 in 2006. For 2007 through 2009, legal immigration decreased to about 1,110,000 and declined further to about 1,045,000 in 2010, 1,055,000 in 2011, and 1,030,000 in 2012. The estimated level of legal immigration in 2013 is 1,050,000.

The intermediate alternative assumes that annual legal immigration will be 1,050,000 persons for 2014 and later. Alternatives I and III assume that ultimate annual legal immigration will be 1,250,000 persons and 850,000 persons, respectively, for 2016 and later. The ultimate assumption for each alternative remains unchanged from the level assumed in last year’s report.

The assumed ratios of annual legal emigration to legal immigration are 20, 25, and 30 percent for alternatives I, II, and III, respectively. This range is consistent with the limited historical data for legal emigration from the Social Security area. These ratios are unchanged from last year’s report. Under the intermediate alternative, by combining the ultimate annual legal immigration and emigration assumptions, ultimate annual net legal immigration is about 790,000 persons. For the low-cost and high-cost scenarios, ultimate annual net legal immigration is 1,000,000 persons and 595,000 persons, respectively.

Significant changes in the method for projecting other immigration were implemented for this year’s report. In previous reports, the entire other immigrant population was modeled in aggregate. For this year’s report, three categories of other immigrants are modeled separately. These categories are: (1) those that were never authorized to enter the Social Security area; (2) those legally admitted for a limited period of time such as students, temporary workers, and exchange visitors (“nonimmigrants”); and (3) those that were nonimmigrants, but have overstayed their visas. Also, in previous reports, annual other emigration was modeled in two groups: a fixed portion and a varying portion estimated by applying departure rates to the other-immigrant population. For this year’s report, other emigration is estimated by applying distinct departure rates to each of the three separate other-immigrant categories, by age and sex.

The estimated number of other immigrants residing in the Social Security area increased from 9.3 million persons for January 1, 2000, to 14.1 million persons for January 1, 2008. The estimated other-immigrant population is 13.3 million persons for January 1, 2009, and 13.4 million persons for January 1, 2010 and January 1, 2011. The estimates for these 3 years are significantly lower than estimates for prior years’ levels, and this is likely due to the recession.

During the period from 2000 to 2006, the level of annual other immigration averaged about 1.4 million persons. However, during 2007 to 2010 (the recession and its surrounding years), annual levels dropped significantly, averaging only about 0.7 million persons. Estimated levels for 2011, 2012, and 2013 are 1.0, 1.2, and 1.3 million persons, respectively. Under the intermediate assumptions, annual other immigration is 1.4 million for 2014, and increases to 1.6 million for 2018 and 2019, reflecting a recovery from recession-depleted levels of the other-immigrant population. Subsequently, it decreases to the ultimate level of 1.4 million persons for 2022. For the low-cost and high-cost scenarios, the future ultimate annual other immigration is 1.7 million persons and 1.1 million persons, respectively, for 2022 and later. Although significant methodological changes were made to the modeling of other immigration, the ultimate assumption for each alternative is unchanged from last year’s report.

Emigration from the other-immigrant population includes those who leave the Social Security area and those who adjust their status to become legal permanent residents. This other-immigrant population is highly mobile and far more likely to leave the Social Security area than is the citizen or legal permanent resident population.

Under the intermediate assumptions, the total annual number of other emigrants who leave the Social Security area averages 625,000 through the 75‑year projection period. In addition, the ultimate annual number of other immigrants who adjust status to become legal permanent residents is assumed to be 450,000 for the intermediate assumptions. This ultimate annual number who adjust status is about one-third of the ultimate annual number of other immigrants entering the Social Security area. For the low-cost and high-cost scenarios, the total annual number of other emigrants averages 725,000 and 500,000, respectively, through the 75‑year projection period. The ultimate annual number of people adjusting status to legal permanent resident status is assumed to be 550,000 persons and 350,000 persons, for the low-cost and high-cost scenarios, respectively. While the ultimate annual number of people adjusting status to become legal permanent residents is unchanged from last year’s report, the annual number of other emigrants who leave the Social Security area is about 25,000 to 30,000 lower than in last year’s report for each alternative. This lower level of other emigration reflects improved historical data from the Department of Homeland Security.

Under the assumptions and methods described above, the projected size of the other-immigrant population grows substantially. This growth reflects the excess of annual other immigration over the combined annual numbers of emigrants and deaths that occur within the other-immigrant population.

Estimated annual net other immigration averaged about 615,000 persons for 2000 through 2004. Estimates of net other immigration for 2005 through 2010 are based on data from the Department of Homeland Security. The estimated level is 1,140,000 for 2005, decreasing to 800,000 for 2006 and 70,000 for 2007. For 2008, estimated net other immigration is negative, at ‑760,000, but returns to a positive level of 105,000 for 2009 and 50,000 for 2010. The estimated net other immigration for 2011, 2012, and 2013 is 80,000, 390,000, and 490,000, respectively.

Under the intermediate assumptions, projected net other immigration is about 555,000 persons for 2014, and about 690,000 persons for 2018. Net other immigration then sharply decreases to about 435,000 for 2022, primarily due to the decline in the number of other immigrants entering the country. This is followed by a more gradual decrease after 2022 to about 315,000 for 2040 and 270,000 for 2090. The decline in net other immigration after 2022 is due to the increasing number of other immigrants residing in the Social Security area. Because the number of other immigrants leaving the Social Security area is based on rates of departure, an increase in the number of other immigrants residing in the Social Security area results in an increase in the number who emigrate out of the area. All other components of other immigration and emigration are assumed to be stable after 2022, and thus do not contribute toward any change in net other immigration. Under the intermediate assumptions, the projected average annual level of net other immigration over the 75-year projection period is about 335,000 persons. For the low-cost and high-cost assumptions, projected average annual net other immigration is about 430,000 persons and 235,000 persons, respectively.

The projected average total level of net immigration (legal and other, combined) is about 1,125,000 persons per year during the 75-year projection period under the intermediate assumptions. For the low-cost and high-cost assumptions, projected average annual total net immigration is about 1,430,000 persons and 830,000 persons, respectively.

Demographers express a wide range of views about the future course of immigration for the United States. Some, like the 2011 Technical Panel mentioned in the previous section, believe that net immigration will increase substantially in the future. Others believe that potential immigrants may be increasingly attracted to other countries, that potential immigrants may be fewer due to lower birth rates in many countries, or that changes in the law or enforcement of the law could reduce immigration.

Table V.A1.—Principal Demographic Assumptions, Calendar Years 1940-2090 

Calendar year		Total fertility ratea		Age-sex-adjusted death rate b per 100,000, by age				Net immigrationc d
				Total	Under 65	65 and over		Legal e	Other f
Historical data:
	1940	2.23		1,919.8	750.1	9,718.8		45,000	—
	1945	2.42		1,716.6	674.8	8,662.9		55,000	—
	1950	3.03		1,561.9	570.2	8,173.7		170,000	—
	1955	3.50		1,453.8	508.2	7,758.4		210,000	—
	1960	3.61		1,454.3	503.2	7,795.4		200,000	—
	1965	2.88		1,428.8	495.2	7,653.3		230,000	—
	1970	2.43		1,340.0	485.7	7,036.3		280,000	—
	1975	1.77		1,204.8	426.6	6,393.6		295,000	—
	1980	1.82		1,136.9	384.3	6,154.3		410,000	200,000
	1985	1.83		1,081.0	353.3	5,932.9		435,000	255,000
	1990	2.07		1,021.3	333.6	5,606.3		500,000	645,000
	1995	1.98		1,001.5	317.9	5,559.5		575,000	585,000
	1996	1.98		987.8	306.6	5,529.1		665,000	500,000
	1997	1.97		971.9	293.3	5,496.4		570,000	570,000
	1998	2.00		963.8	285.4	5,487.1		490,000	615,000
	1999	2.01		970.6	283.2	5,553.6		520,000	615,000
	2000	2.05		960.7	281.0	5,492.3		670,000	610,000
	2001	2.03		951.1	280.4	5,422.8		795,000	610,000
	2002	2.03		947.0	279.0	5,400.6		730,000	615,000
	2003	2.05		933.4	277.2	5,308.6		575,000	615,000
	2004	2.06		898.9	269.7	5,093.9		750,000	620,000
	2005	2.06		901.3	270.7	5,105.4		870,000	1,140,000
	2006	2.11		876.1	267.6	4,933.5		910,000	800,000
	2007	2.12		856.8	261.6	4,825.2		800,000	70,000
	2008	2.07		857.0	258.8	4,845.5		835,000	-760,000
	2009	2.00		827.1	255.3	4,639.7		830,000	105,000
	2010	1.93		821.3	248.5	4,640.1		785,000	50,000
	2011 g	1.89		820.1	249.7	4,622.8		790,000	80,000
	2012 g	1.88		801.9	247.0	4,501.5		775,000	390,000
	2013 g	1.89		790.6	244.4	4,432.2		790,000	490,000
Intermediate:
	2015	1.94		770.0	239.3	4,308.1		790,000	535,000
	2020	2.06		730.2	226.7	4,087.1		790,000	560,000
	2025	2.05		697.3	214.4	3,917.1		790,000	405,000
	2030	2.03		667.6	202.7	3,767.8		790,000	370,000
	2035	2.01		640.2	191.6	3,630.7		790,000	335,000
	2040	2.00		614.6	181.3	3,503.0		790,000	315,000
	2045	2.00		590.6	171.7	3,383.3		790,000	300,000
	2050	2.00		568.1	162.7	3,270.7		790,000	295,000
	2055	2.00		547.0	154.3	3,164.6		790,000	285,000
	2060	2.00		527.1	146.5	3,064.6		790,000	280,000
	2065	2.00		508.4	139.1	2,970.2		790,000	280,000
	2070	2.00		490.8	132.3	2,880.9		790,000	275,000
	2075	2.00		474.1	125.8	2,796.4		790,000	275,000
	2080	2.00		458.4	119.8	2,716.3		790,000	270,000
	2085	2.00		443.5	114.1	2,640.3		790,000	270,000
	2090	2.00		429.5	108.7	2,568.0		790,000	270,000
Low-cost:
	2015	1.96		784.2	243.0	4,392.0		960,000	660,000
	2020	2.14		768.1	238.0	4,302.8		1,000,000	735,000
	2025	2.19		751.7	231.8	4,218.0		1,000,000	555,000
	2030	2.23		735.4	225.4	4,135.5		1,000,000	495,000
	2035	2.28		719.4	219.1	4,055.5		1,000,000	445,000
	2040	2.30		703.9	212.9	3,977.9		1,000,000	410,000
	2045	2.30		689.0	206.9	3,902.7		1,000,000	390,000
	2050	2.30		674.5	201.2	3,830.1		1,000,000	370,000
	2055	2.30		660.5	195.6	3,759.7		1,000,000	360,000
	2060	2.30		646.9	190.3	3,691.7		1,000,000	350,000
	2065	2.30		633.8	185.1	3,625.7		1,000,000	345,000
	2070	2.30		621.2	180.1	3,561.8		1,000,000	340,000
	2075	2.30		608.9	175.3	3,499.9		1,000,000	340,000
	2080	2.30		597.0	170.6	3,439.9		1,000,000	335,000
	2085	2.30		585.5	166.1	3,381.7		1,000,000	335,000
	2090	2.30		574.3	161.7	3,325.2		1,000,000	335,000
High-cost:
	2015	1.91		755.8	235.6	4,224.3		630,000	315,000
	2020	1.97		691.6	214.8	3,870.1		595,000	135,000
	2025	1.91		641.5	195.7	3,613.5		595,000	320,000
	2030	1.83		598.5	178.5	3,398.8		595,000	295,000
	2035	1.75		560.5	163.1	3,209.5		595,000	270,000
	2040	1.70		526.3	149.3	3,039.7		595,000	250,000
	2045	1.70		495.5	137.0	2,885.7		595,000	240,000
	2050	1.70		467.6	125.9	2,745.4		595,000	230,000
	2055	1.70		442.2	116.0	2,617.0		595,000	225,000
	2060	1.70		419.0	107.0	2,499.1		595,000	220,000
	2065	1.70		397.8	98.9	2,390.6		595,000	220,000
	2070	1.70		378.4	91.6	2,290.4		595,000	215,000
	2075	1.70		360.5	85.0	2,197.5		595,000	215,000
	2080	1.70		344.0	78.9	2,111.1		595,000	210,000
	2085	1.70		328.7	73.4	2,030.7		595,000	210,000
	2090	1.70		314.5	68.4	1,955.5		595,000	210,000

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a

The total fertility rate for any year is the average number of children that would be born to a woman in her lifetime if she were to experience, at each age of her life, the birth rate observed in, or assumed for, the selected year, and if she were to survive the entire childbearing period.

b

Based on the enumerated total population as of April 1, 2010, if that population were to experience the death rates by age and sex observed in, or assumed for, the selected year.

c

Net immigration values are rounded to the nearest 5,000.

d

Estimates do not include persons who attained legal permanent resident status under the special one-time provisions of the Immigration Reform and Control Act of 1986.

e

Historical estimates of net legal immigration assume a 25 percent reduction in legal immigration due to legal emigration.

f

Historical net other immigration estimates depend on a residual method, using Department of Homeland Security January 1 stock estimates for 2005 through 2011.

g

Fertility is estimated starting in 2012, mortality starting in 2011, and immigration starting in 2012.

4. Total Population Estimates

The starting Social Security area population for January 1, 2012, is derived from the Census Bureau’s estimate of the residents of the 50 States and D.C. and U.S. Armed Forces overseas. Adjustments are made to reflect mortality assumptions for the aged population since 2010 that are consistent with Medicare and Social Security data, net immigration assumptions for the aged population since 2010, estimates of the net undercount in the 2010 census, inclusion of U.S. citizens living abroad (including residents of U.S. territories), and inclusion of non-citizens living abroad who are insured for Social Security benefits. The Office of the Chief Actuary projects the population in the Social Security area by age, sex, and marital status for January 1 of each year 2013 through 2090 by combining the assumptions for future fertility, mortality, and immigration with assumptions for marriage and divorce. Previous sections of this chapter present the assumptions for future fertility, mortality, and immigration. Assumptions for future rates of marriage and divorce reflect historical data from the National Center for Health Statistics, the Census Bureau, and selected individual States.

For the estimates in this report, the Trustees have assumed that Social Security will expand its guidelines to recognize all auxiliary beneficiaries for valid same-sex marriages and same-sex marriages will eventually be recognized in all States. The effect on marriage rates is assumed to be fully realized within 25 years, reflecting both the gradual acceptance of same-sex marriage in all States and behavioral changes in the population consistent with the acceptance.

This report presents a July 1 (i.e., midyear) population for each year, which is derived from surrounding January populations. Table V.A2 shows the historical and projected population for July 1 by broad age group, for the three alternatives. It also shows the aged and total dependency ratios (see table footnotes for definitions).

Table V.A2.—Social Security Area Population on July 1 and Dependency Ratios,
Calendar Years 1945-2090 

Calendar year		Population (in thousands)					Dependency ratio
		Under 20	20-64	65 and over	Total		Aged a	Total b
Historical data:
	1945	49,121	88,109	10,896	148,126		0.124	0.681
	1950	53,902	92,382	12,769	159,052		.138	.722
	1955	63,291	96,207	15,075	174,574		.157	.815
	1960	73,074	99,802	17,277	190,153		.173	.905
	1965	80,032	104,879	19,070	203,982		.182	.945
	1970	81,047	113,000	20,901	214,948		.185	.902
	1975	78,718	122,654	23,316	224,687		.190	.832
	1980	74,851	134,104	26,308	235,263		.196	.754
	1985	73,077	144,567	29,145	246,788		.202	.707
	1990	74,823	152,753	31,935	259,510		.209	.699
	1995	79,570	160,552	34,434	274,557		.214	.710
	2000	82,384	169,995	35,687	288,067		.210	.695
	2005	84,184	180,245	37,184	301,614		.206	.673
	2010	85,393	188,379	41,047	314,819		.218	.671
	2013  c	84,925	192,012	45,176	322,113		.235	.678
Intermediate:
	2015	85,414	194,094	48,170	327,678		.248	.688
	2020	88,211	198,246	56,643	343,101		.286	.731
	2025	91,406	200,512	66,114	358,032		.330	.786
	2030	94,060	203,105	74,364	371,528		.366	.829
	2035	97,539	206,276	79,462	383,276		.385	.858
	2040	99,185	212,109	82,114	393,407		.387	.855
	2045	100,060	218,788	83,783	402,631		.383	.840
	2050	101,486	224,196	86,030	411,711		.384	.836
	2055	103,714	228,560	88,960	421,234		.389	.843
	2060	106,315	232,274	92,678	431,267		.399	.857
	2065	108,680	236,738	96,196	441,614		.406	.865
	2070	110,587	241,457	99,962	452,006		.414	.872
	2075	112,178	246,406	103,722	462,306		.421	.876
	2080	113,874	252,688	105,962	472,525		.419	.870
	2085	115,905	257,378	109,493	482,776		.425	.876
	2090	118,130	261,141	113,830	493,101		.436	.888
Low-cost:
	2015	85,581	194,297	48,143	328,021		.248	.688
	2020	89,609	199,626	56,360	345,595		.282	.731
	2025	94,798	203,160	65,387	363,345		.322	.788
	2030	100,202	206,983	73,042	380,228		.353	.837
	2035	107,148	211,369	77,443	395,960		.366	.873
	2040	112,480	218,942	79,382	410,804		.363	.876
	2045	116,745	228,088	80,432	425,266		.353	.864
	2050	121,433	236,676	82,227	440,336		.347	.860
	2055	127,032	244,903	84,882	456,818		.347	.865
	2060	133,122	253,238	88,419	474,780		.349	.875
	2065	139,348	262,784	91,742	493,874		.349	.879
	2070	145,298	273,239	95,208	513,744		.348	.880
	2075	150,909	284,808	98,555	534,273		.346	.876
	2080	156,612	298,554	100,422	555,588		.336	.861
	2085	162,773	311,045	104,092	577,911		.335	.858
	2090	169,341	322,696	109,265	601,302		.339	.863
High-cost:
	2015	85,205	193,822	48,197	327,224		0.249	0.688
	2020	86,191	195,722	56,912	338,826		.291	.731
	2025	87,394	196,635	66,843	350,871		.340	.784
	2030	87,438	198,210	75,728	361,376		.382	.823
	2035	87,659	200,384	81,581	369,624		.407	.845
	2040	85,980	204,625	85,014	375,620		.415	.836
	2045	83,966	208,921	87,366	380,253		.418	.820
	2050	82,691	211,298	90,105	384,095		.426	.818
	2055	82,225	212,039	93,308	387,572		.440	.828
	2060	82,187	211,456	97,158	390,801		.459	.848
	2065	81,750	211,215	100,796	393,761		.477	.864
	2070	80,844	210,676	104,784	396,304		.497	.881
	2075	79,761	209,664	108,884	398,309		.519	.900
	2080	78,895	209,385	111,437	399,717		.532	.909
	2085	78,372	207,555	114,644	400,572		.552	.930
	2090	78,012	205,112	117,797	400,921		.574	.955

---

a

Ratio of the population at ages 65 and over to the population at ages 20-64.

b

Ratio of the population at ages 65 and over and the population under age 20 to the population at ages 20‑64.

c

Estimated.

Notes:
1. Historical data are subject to revision.
2. Totals do not necessarily equal the sums of rounded components.

5. Life Expectancy Estimates

Life expectancy, or average remaining number of years expected prior to death, is an additional way to summarize the Trustees’ mortality assumptions. This report includes life expectancy in two different forms (period and cohort) for two separate purposes.

•

Period life expectancy for a given year uses the actual or expected death rates at each age for that year. It is a useful summary statistic for illustrating the overall level of the death rates experienced in a single year. Period life expectancy for a particular year provides an individual’s expected average remaining lifetime at a selected age, assuming no change in death rates after that year. Table V.A3 presents historical and projected life expectancy calculated on a period basis.

•

Cohort life expectancy does not use death rates for a single year, but for the series of years in which the individual will actually reach each succeeding age if he or she survives. Cohort life expectancy provides an individual’s expected average remaining lifetime at a selected age in a given year, using actual or expected future changes in death rates. Table V.A4 presents historical and projected life expectancy calculated on a cohort basis. Cohort life expectancy is somewhat greater than period life expectancy for a given year because: (a) death rates at any age tend to decline over time; and (b) cohort life expectancy uses death rates from future years, while period life expectancy uses death rates only from the given year.

Life expectancy at a given age reflects death rates at that and all older ages. Period life expectancy is somewhat related to the age-sex-adjusted death rate discussed in section V.A.2. However, life expectancy places far greater weight on death rates at lower ages than at higher ages. Therefore, changes in death rates at lower ages have far greater effects in changing life expectancy over time. It is important to keep this concept in mind when considering trends in life expectancy.

Table V.A3.—Period Life Expectancy ^a

		Historical data
Calendar year		At birth			At age 65
		Male	Female		Male	Female
	1940	61.4	65.7		11.9	13.4
	1945	62.9	68.4		12.6	14.4
	1950	65.6	71.1		12.8	15.1
	1955	66.7	72.8		13.1	15.6
	1960	66.7	73.2		12.9	15.9
	1965	66.8	73.8		12.9	16.3
	1970	67.2	74.9		13.1	17.1
	1975	68.7	76.6		13.7	18.0
	1980	69.9	77.5		14.0	18.4
	1985	71.1	78.2		14.4	18.6
	1990	71.8	78.9		15.1	19.1
	1995	72.5	79.1		15.4	19.1
	2000	74.0	79.4		15.9	19.0
	2001	74.1	79.5		16.1	19.1
	2002	74.2	79.5		16.2	19.1
	2003	74.4	79.6		16.3	19.2
	2004	74.8	80.0		16.7	19.5
	2005	74.8	80.0		16.7	19.5
	2006	75.1	80.2		17.0	19.7
	2007	75.4	80.5		17.2	19.9
	2008	75.5	80.5		17.2	19.9
	2009	75.9	80.8		17.5	20.2
	2010	76.1	80.9		17.6	20.2
	2011  b	76.1	80.9		17.7	20.2
	2012  b	76.4	81.1		17.9	20.4
	2013  b	76.5	81.3		18.0	20.5
		Intermediate						Low-cost						High-cost
Calendar year		At birth			At age 65			At birth			At age 65			At birth			At age 65
		Male	Female		Male	Female		Male	Female		Male	Female		Male	Female		Male	Female
	2015	76.9	81.5		18.3	20.7		76.7	81.3		18.2	20.6		77.1	81.7		18.5	20.8
	2020	77.6	82.1		18.8	21.1		77.0	81.6		18.4	20.7		78.3	82.6		19.3	21.5
	2025	78.2	82.6		19.2	21.4		77.3	81.8		18.6	20.9		79.3	83.4		19.9	22.0
	2030	78.8	83.1		19.6	21.7		77.6	82.1		18.8	21.0		80.2	84.2		20.4	22.5
	2035	79.4	83.5		19.9	22.0		77.9	82.3		18.9	21.2		81.0	84.9		20.9	22.9
	2040	79.9	84.0		20.2	22.3		78.2	82.5		19.1	21.3		81.8	85.5		21.4	23.3
	2045	80.4	84.4		20.5	22.5		78.5	82.8		19.3	21.5		82.6	86.1		21.8	23.7
	2050	80.9	84.8		20.7	22.8		78.8	83.0		19.4	21.6		83.3	86.7		22.2	24.1
	2055	81.4	85.2		21.0	23.0		79.0	83.2		19.6	21.8		83.9	87.2		22.6	24.5
	2060	81.8	85.5		21.3	23.3		79.3	83.5		19.7	21.9		84.5	87.7		23.0	24.8
	2065	82.3	85.9		21.5	23.5		79.6	83.7		19.9	22.0		85.1	88.2		23.3	25.2
	2070	82.7	86.2		21.8	23.8		79.8	83.9		20.0	22.2		85.7	88.7		23.7	25.5
	2075	83.1	86.6		22.0	24.0		80.1	84.1		20.2	22.3		86.2	89.1		24.0	25.8
	2080	83.5	86.9		22.3	24.2		80.3	84.3		20.3	22.4		86.7	89.5		24.4	26.1
	2085	83.9	87.2		22.5	24.4		80.6	84.5		20.5	22.6		87.2	89.9		24.7	26.4
	2090	84.3	87.5		22.8	24.6		80.8	84.7		20.6	22.7		87.7	90.3		25.0	26.7

---

a

The period life expectancy at a given age for a given year is the average remaining number of years expected prior to death for a person at that exact age, born on January 1, using the mortality rates for that year over the course of his or her remaining life.

b

Estimated.

Table V.A4.—Cohort Life Expectancy ^a

Calendar year	Intermediate						Low-cost						High-cost
	At birth  b			At age 65  c			At birth  b			At age 65  c			At birth  b			At age 65  c
	Male	Female		Male	Female		Male	Female		Male	Female		Male	Female		Male	Female
1940	70.6	76.7		12.7	14.7		70.3	76.5		12.7	14.7		70.8	77.1		12.7	14.7
1945	72.5	78.5		13.0	15.4		72.1	78.0		13.0	15.4		72.9	78.9		13.0	15.4
1950	73.8	79.8		13.1	16.2		73.2	79.2		13.1	16.2		74.4	80.5		13.1	16.2
1955	74.5	80.5		13.1	16.7		73.8	79.7		13.1	16.7		75.3	81.3		13.1	16.7
1960	75.2	80.9		13.2	17.4		74.3	80.0		13.2	17.4		76.2	82.0		13.2	17.4
1965	76.1	81.5		13.5	18.0		75.0	80.4		13.5	18.0		77.4	82.7		13.5	18.0
1970	77.3	82.3		13.8	18.5		76.0	81.1		13.8	18.5		78.8	83.8		13.8	18.5
1975	78.2	83.0		14.2	18.7		76.7	81.6		14.2	18.7		80.0	84.7		14.2	18.7
1980	79.1	83.7		14.7	18.8		77.4	82.1		14.7	18.8		81.1	85.5		14.7	18.8
1985	79.8	84.3		15.4	19.1		77.9	82.5		15.4	19.1		82.0	86.3		15.4	19.1
1990	80.5	84.8		16.1	19.5		78.3	82.9		16.1	19.4		82.9	87.0		16.1	19.5
1995	81.2	85.3		16.8	19.8		78.8	83.2		16.7	19.7		83.8	87.6		16.9	20.0
2000	81.7	85.7		17.6	20.3		79.2	83.5		17.5	20.1		84.5	88.2		17.8	20.6
2001	81.8	85.8		17.8	20.4		79.2	83.6		17.6	20.2		84.7	88.3		18.0	20.7
2002	81.9	85.9		17.9	20.5		79.3	83.6		17.7	20.3		84.8	88.4		18.2	20.8
2003	82.0	86.0		18.1	20.6		79.3	83.7		17.8	20.4		84.9	88.5		18.4	21.0
2004	82.1	86.1		18.2	20.7		79.4	83.7		17.9	20.4		85.0	88.6		18.5	21.1
2005	82.2	86.1		18.3	20.8		79.4	83.7		18.0	20.5		85.2	88.7		18.7	21.2
2006	82.3	86.2		18.5	20.9		79.5	83.8		18.1	20.6		85.3	88.8		18.9	21.4
2007	82.4	86.3		18.6	21.0		79.6	83.8		18.2	20.6		85.4	88.9		19.0	21.5
2008	82.5	86.3		18.7	21.1		79.6	83.9		18.3	20.7		85.5	89.0		19.2	21.6
2009	82.6	86.4		18.8	21.2		79.7	83.9		18.3	20.7		85.7	89.1		19.3	21.7
2010	82.7	86.5		18.9	21.3		79.8	84.0		18.4	20.8		85.8	89.2		19.5	21.8
2011	82.7	86.6		19.0	21.4		79.8	84.0		18.5	20.8		85.9	89.3		19.6	22.0
2012	82.8	86.6		19.1	21.4		79.8	84.1		18.5	20.9		86.0	89.4		19.8	22.1
2013	82.9	86.7		19.2	21.5		79.9	84.1		18.6	20.9		86.1	89.5		19.9	22.2
2015	83.1	86.8		19.3	21.6		80.0	84.2		18.7	21.0		86.4	89.7		20.2	22.4
2020	83.5	87.2		19.7	22.0		80.3	84.4		18.8	21.1		87.0	90.2		20.7	22.9
2025	83.9	87.5		20.0	22.3		80.5	84.6		19.0	21.3		87.5	90.6		21.2	23.4
2030	84.3	87.9		20.4	22.5		80.8	84.8		19.2	21.4		88.1	91.1		21.7	23.8
2035	84.7	88.2		20.7	22.8		81.0	85.0		19.3	21.6		88.6	91.5		22.2	24.2
2040	85.1	88.5		21.0	23.1		81.3	85.2		19.5	21.7		89.1	91.9		22.6	24.6
2045	85.5	88.8		21.2	23.3		81.5	85.4		19.7	21.9		89.6	92.2		23.0	25.0
2050	85.8	89.1		21.5	23.6		81.7	85.6		19.8	22.0		90.0	92.6		23.4	25.3
2055	86.2	89.3		21.8	23.8		82.0	85.8		20.0	22.2		90.4	93.0		23.8	25.7
2060	86.5	89.6		22.0	24.0		82.2	86.0		20.1	22.3		90.8	93.3		24.2	26.0
2065	86.8	89.9		22.3	24.3		82.4	86.2		20.3	22.4		91.2	93.6		24.5	26.3
2070	87.2	90.1		22.5	24.5		82.6	86.3		20.4	22.6		91.6	93.9		24.9	26.6
2075	87.5	90.4		22.8	24.7		82.9	86.5		20.6	22.7		92.0	94.2		25.2	26.9
2080	87.8	90.6		23.0	24.9		83.1	86.7		20.7	22.8		92.3	94.5		25.5	27.2
2085	88.0	90.9		23.2	25.1		83.3	86.8		20.9	23.0		92.7	94.8		25.8	27.5
2090	88.3	91.1		23.5	25.3		83.5	87.0		21.0	23.1		93.0	95.1		26.1	27.8

---

a

The cohort life expectancy at a given age for a given year is the average remaining number of years expected prior to death for a person at that exact age, born on January 1, using the mortality rates for the series of years in which the individual will actually reach each succeeding age if he or she survives.

b

Cohort life expectancy at birth for those born in the calendar year is based on a combination of actual and estimated death rates for birth years 1940 through 2010. For birth years after 2010, these values depend on estimated death rates.

c

Age 65 cohort life expectancy for those attaining age 65 in calendar years 1940 though 2010 depends on actual death rates or on a combination of actual and estimated death rates. After 2010, these values depend on estimated death rates.

---

1

Actuarial Studies published by the Office of the Chief Actuary, Social Security Administration, contain further details about the assumptions, methods, and actuarial estimates. A complete list of available studies may be found at www.socialsecurity.gov/OACT/NOTES/actstud.html. To obtain copies of such studies or of this report, please submit a request at www.socialsecurity.gov/OACT/request.html or write to: Office of the Chief Actuary, 700 Altmeyer Building, 6401 Security Boulevard, Baltimore, MD 21235. This entire report, along with supplemental year-by-year tables, may also be found at
www.socialsecurity.gov/OACT/TR/2014/index.html.

2

Defined to be the average number of children that would be born to a woman in her lifetime if she were to experience, at each age of her life, the birth rate observed in, or assumed for, the selected year, and if she were to survive the entire childbearing period. A rate of about 2.1 would ultimately result in a nearly constant population if immigration and emigration were both zero, and if death rates were to remain at current levels.

3

These rates reflect NCHS data on deaths and Census estimates of population.

4

Based on the enumerated total population as of April 1, 2010, if that population were to experience the death rates by age and sex for the selected year.

5

This average excludes those persons who attained legal permanent resident status under the special, one-time provisions of the Immigration Reform and Control Act of 1986.