Effect of retiring baby boomers to US economy Research Paper

Effect of retiring baby boomers to US economy - Research Paper Example In this regard, it has been projected that the world will have about 1 billion elderly people by the year 2030, which accounts for about 33% of the world population3. As earlier stated, the U.S. is one among the countries facing the challenge of an aging population. This is because its population has been aging very fast though as fast as that of Japan. Research indicates that the U.S. aging population increased to 13.1% in 2010 up from 8.3% in 19504. The growth is projected to reach around 19.9% by 2030 and 21.2% by the year 2050. However, the research also found out that as the aging population continues to increase, the population consisting of children and the working class will decline in a few decades to come. Projections suggest that the U.S. aging population will increase by double digits in the next forty years. In this regard, the elderly age group above 65 years will increase to about 88.5 by the year 2050 up from 40.2 million in 2010. The United States is currently worrie d with the rate at which the aging population is increasing. This is because it implies that it will soon retire many baby boomers that have been very important to the U.S. economy5. In this regard, many U.S. citizens including economic analysts in the country claim that retiring baby boomers might adversely affect the U.S. economy being that it is currently struggling to recover from recession. However, not everyone is of opinion as some are skeptical arguing that retiring baby boomers may not affect the economy in a negative way. Baby boomers are basically those born between 1946 to about 1960s6. Mathematically, people born during this time are approaching their retirement age as per U.S. labor laws where the retirement age stands at 65 years of age. Mckinsey Global Institute reveals that the latest census report on America’s population found out that there are about 78 million baby boomers in the U.S. born somewhere between 1946 and 19647. This implies that a very huge num ber of baby boomers are likely to be retired in the near future, something that will most likely affect the economy in one way or the other. The objective of this paper is to examine the impacts that retiring baby boomers may have on the U.S. economy. To begin with, retiring baby boomers will impacts on the U.S. economy in different ways both positively and negatively. Currently baby boomers form the majority of workforce in the U.S. In fact, the baby boomers have contributed greatly to the growth of the United States something that cannot be denied8. This is evident from the kind of development that the America has experienced since 1946 to date. Research indicates that the American baby boomers numbering about 79 million according to a census report have earned huge amount of incomes, created wealth, which in turn spurred economic growth9. Therefore, retiring this population will most likely leave a big vacuum in the workforce, as there will be a reduction in the skilled workforce to help restore the economy of the U.S. to where it was before the financial crisis of 2007/2008. However, since the U.S. economy is still struggling to recover from the recent financial meltdown, retiring baby boomers may worsen the situation according to some economic pundits. This is because there will be little expertise to help in revamping the economy