13.1.4 Baby Boomers

Of particular interest to gerontologists today is the population of Baby Boomers, the cohort born between 1946 and 1964 and now reaching their 60s and 70s. Coming of age in the 1960s and early 1970s, the baby boom generation was the first group of children and teenagers with their own spending power and therefore their own marketing power (Macunovich 2000). As this group has aged, it has redefined what it means to be young, middle-aged, and now old. People in the Boomer generation do not want to grow old the way their grandparents did; the result is a wide range of products designed to ward off the effects—or the signs—of aging. Previous generations of people over sixty-five were “old.” Baby Boomers are in “later life” or “the third age” (Gilleard and Higgs 2007).

The baby boom generation is the cohort driving much of the dramatic increase in the over-sixty-five population. Figure 13.7 shows a comparison of the U.S. population by age and gender between 2000 and 2010. The biggest bulge in the pyramid (representing the largest population group) moves up the pyramid over the course of the decade; in 2000, the largest population group was age thirty-five to fifty-five. In 2010, that group was age forty-five to sixty-five, meaning the oldest baby Boomers were just reaching the age at which the U.S. Census considers them elderly. By 2030, all Baby Boomers will be age 65 and older, and represent the largest group of elderly people.

This aging of the Baby Boom cohort has serious implications for our society. Healthcare is one of the areas most impacted by this trend. According to the U.S. Department of Health and Human Services, healthcare spending is projected to grow by 5.5 percent each year from now until 2027. The portion of government spending on Medicare (a program in which the government covers some costs of healthcare for the elderly) is expected to increase from 3 percent of gross domestic product (GDP) in 2009 to 8 percent of GDP in 2030, and to 15 percent in 2080 (CMS 2018).

Certainly, as Boomers age, they will put increasing burdens on the entire U.S. healthcare system. The American Geriatrics Society notes that from 2013-2025, there will be a 45 percent increase in demand for physicians who specialize in geriatrics. As a result, over 33,000 specialists will be needed to fill the healthcare needs in 2025. And in 2020, there were only 6,320 such specialists in the United States (AGS 2021).

Unlike the elderly of previous generations, Boomers do not expect that turning sixty-five means their active lives are over. They are not willing to abandon work or leisure activities, but they may need more medical support to keep living vigorous lives. This desire of a large group of over-sixty-five-year-olds wanting to continue with a high activity level is driving innovation in the medical industry (Shaw n.d.).

The economic impact of aging Boomers is also an area of concern for many observers. Although the baby boom generation earned more than previous generations and enjoyed a higher standard of living, they did not adequately prepare for retirement. According to most retirement and investment experts, in order to maintain their accustomed lifestyle, people need to save ten times their annual income before retiring. (Note: That's income, not salary.) So if a person has an income of $60,000 per year, they should have saved $600,000. If they made $100,000 per year, they should have saved $1 million. But most Baby Boomers have only saved an estimated $144,000, and only 40 percent have saved more than $250,000 (Gravier 2021). The causes of these shortfalls are varied, and include everything from lavish spending to economic recession to companies folding and reducing pension payments. Higher education costs increased significantly while many Baby Boomers were sending their children to college. No matter what the cause, many retirees report a great deal of stress about running out of money.

Just as some observers are concerned about the possibility of Medicare being overburdened, Social Security is considered to be at risk. Social Security is a government-run retirement program funded primarily through payroll taxes. With enough people paying into the program, there should be enough money for retirees to take out. But with the aging Boomer cohort starting to receive Social Security benefits and fewer workers paying into the Social Security trust fund, economists warn that the system will collapse by the year 2037. A similar warning came in the 1980s; in response to recommendations from the Greenspan Commission, the retirement age (the age at which people could start receiving Social Security benefits) was raised from sixty-two to sixty-seven and the payroll tax was increased. A similar hike in retirement age, perhaps to seventy, is a possible solution to the current threat to Social Security.