In the days since the presidential election, much talk has been devoted to the pending “fiscal cliff” that our country is facing. However, there’s an even larger cliff looming off in the distance that, unfortunately, has received little attention.
What is the eldercare cliff?
It is a shorthand name for the economic crisis that will arise as the number of people 65 and over increases by 135%, just as the number of people ages 16 to 64 decreases by comparison. Currently, the ratio of people under 65 (i.e., 16-64) versus people over 65 is 5.1:1, meaning that for each person age 65+ there are 5.1 people available to work, to pay the taxes that fund programs like Medicaid and Medicare, and to provide care for the elderly. By 2050, that ratio will have changed to 2.9:1.
Additionally, approximately 13% of the U.S. population currently provides some form of unpaid eldercare, the provision of which can, among other things, result in losing out on promotions and decreased availability for working. By the time we’ve reached the cliff, this number is expected to increase by 150%, meaning even less taxable income.
How can we stop it?
It cannot be stopped. Barring the unforeseen, our nation’s demographics will not change and we will have a disparity between the number of elderly and the numbers of people available to work, provide care, and pay taxes. To lessen the impact from the fall, we need our elected-leaders and employers to recognize the problem, now, and take steps to have a plan in place by the time we get there.