2021 OASDI Trustees Report

C. ASSUMPTIONS ABOUT THE FUTURE

The future income and cost of the OASI and DI Trust Funds will depend on many factors, including the size and characteristics of the population receiving benefits, the level of monthly benefit amounts, the size of the workforce, and the level of covered workers’ earnings. These factors will depend in turn on future birth rates, death rates, immigration, marriage and divorce rates, retirement-age patterns, disability incidence and termination rates, employment rates, productivity gains, wage increases, inflation, interest rates, and many other demographic, economic, and program-specific factors.

Table II.C1 presents key demographic, economic, and programmatic assumptions for three alternative scenarios. The intermediate assumptions reflect the Trustees’ best estimates of future experience. Therefore, most of the figures in this overview present outcomes under the intermediate assumptions only. Any projection of the future is, of course, uncertain. For this reason, the Trustees also present results under low-cost and high-cost alternatives to provide a range of possible future experience. The actual future costs are unlikely to be as extreme as those portrayed by the low-cost or high-cost projections. A separate section on the uncertainty of the projections, beginning on page 19, highlights the implications of these alternative scenarios.

The Trustees reexamine the assumptions each year in light of recent experience and new information. This annual review helps to ensure that the Trustees’ assumptions provide the best estimate of future possibilities.

Table II.C1.—Key Assumptions^a and Summary Measures
for the Long-Range (75-year) Projection Period

Long-range assumptions	Intermediate	Low-cost	High-cost
Demographic:
Average annual total fertility rate (children per woman), for 2031 through 2095b	1.99	2.19	1.69
Average annual percentage reduction in total age‑sex‑adjusted death rates from 2030 to 2095	.74	.28	1.25
Average annual net lawful permanent resident (LPR) immigration (in thousands) for 2031 through 2095	788	1,000	595
Average annual net other-than-LPR immigration (in thousands) for 2031 through 2095	461	688	235
Economic:
Average annual percentage change in:
Productivity (total U.S. economy), for 2031 and later	1.63	1.93	1.33
Average wage in covered employment from 2030 to 2095	3.55	4.77	2.33
Consumer Price Index (CPI-W), for 2024 and later	2.40	3.00	1.80
Average annual real wage differential (percent) for 2031 through 2095	1.15	1.77	.53
Unemployment rate (percent, age-sex-adjusted), for 2029 and later	4.5	3.5	5.5
Annual trust fund real interest rate (percent), for 2031 and later	2.3	2.8	1.8
Programmatic:
Average annual disability incidence rate (per 1,000 exposed, age-sex-adjusted) for 2031 through 2095	5.0	4.0	6.0
Average annual disability recovery rate (per 1,000 beneficiaries, age-sex-adjusted) for 2031 through 2095	10.4	12.5	8.3

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a

See chapter V for details, including historical and projected values.

b

The ultimate total fertility rates of 2.00 for the intermediate assumptions, 2.20 for the low-cost assumptions, and 1.70 for the high-cost assumptions are fully reached for women of all ages in 2056. The new cohort-based projection approach adopted for this report assumes that the ultimate rates will be achieved over the lifetime of women attaining age 14 soon after the start of the projection period, resulting in an extended transition from current low birth rates to ultimate birth rates. See section V.A.1 for additional details.