With a major part of the nation's population entering its retirement years and birth rates falling domestically, the shortfall in the work force will be filled by immigrants and their offspring, experts say. How that group fares economically in the years ahead could have a big impact on everything from the kind of medical services baby boomers receive to the prices they can get for their homes.
Immigrants and baby boomers are two groups whose destinies are converging in the next 20 years," says Dowell Myers, a demographer at the University of Southern California. "Baby boomers will surrender their economic role to this generation of immigrants and their children," who will evolve into a critical pool of laborers and taxpayers, he says.
Prof. Myers, author of the recent book "Immigrants and Boomers: Forging a New Social Contract for the Future of America," is among a crop of academics studying the link between the giant generation born between 1946 and 1964 and newcomers to the U.S., mainly Latin American immigrants.
The U.S. is undergoing a seismic demographic change that will kick in over the next decade or so. In California, for example, there were 9.7 million baby boomers between the ages of 40 and 49 in 2005, who accounted for 51% of the prime working-age population. By 2020, they will be 55 to 74 years old, with most boomers on the brink of retirement or about to plunge into it.
The weight of this aging population will swell relative to the pool of working-age people. The ratio of senior citizens to prime-working-age people, 25 to 64 years old, will jump 30% in the decade between 2010 and 2020 and an additional 29% in the following decade, according to Prof. Myers. All told, the ratio of seniors to working-age residents, including immigrants, will grow from 250 seniors per 1,000 working-age people in 2010 to 411 per 1,000 in 2030, he calculates.
This hefty burden will be hard for the economy to absorb, and will require some difficult choices. Those may include tax increases, benefit cuts for seniors, increases in the taxable income of working-age residents, as well as efforts to attract more immigrants to fill out the work force.
At a hearing on New York's Ellis Island last month, Prof. Myers told congressional leaders that the current influx of immigrants, about 1.5 million annually, is softening the impact of the bulging population of seniors relative to working-age adults by about a quarter from what it would be without immigration. Boosting immigration would relieve more pressure, he and other experts say.
But given the nation's polarizing debate over illegal immigration, the U.S. is unlikely to implement policies to attract many newcomers in the near future. That suggests that one of the country's most pressing tasks may be improving the earnings prospects of its youngsters, especially Latino youth, who will have to carry much of the financial burden for the supersize boomer generation.
One of the challenges is that Americans don't seem to be aware of the vital role the next generation will play. The predominantly white senior citizens and boomers, who account for the majority of the nation's decision makers, often vote against measures to boost services or raise taxes for schools increasingly populated by Hispanics. That's a problem, because better education is the ticket to prosperity for those on whose tax dollars boomers will rely.
Ron Crouch, director of Kentucky's State Data Center at the University of Louisville, makes about 150 presentations a year to groups including educators, high-tech industry leaders and government officials to paint a picture of what the U.S. will look like as an aging white population converges with a growing population of immigrants and minority youth.
"If I'm an old white person, I better be interested in how these young, Hispanic kids are doing," Mr. Crouch told an audience attending the National School Board Association conference in San Francisco last month.
Between 1990 and 2005, blacks and Hispanics, including immigrants, accounted for 80% of all population growth in the U.S. They accounted for all the population growth among those 45 and younger, according to the Census Bureau. That represents both the younger end of the current work force and the nation's future labor pool.
This maturing younger population will need to be ready for opportunities far beyond the fields, construction sites and nursing homes that employed many of their parents, Mr. Crouch says. They will also need to be "architects, business owners, doctors and scientists," he says.
More broadly, the U.S. economy needs enough skilled workers to stay competitive. But current statistics bode ill for the future of the country's youth -- and the aging generation whose fate is tied to theirs.
In Georgia, for example, minorities accounted for two-thirds of the population growth between 1990 and 2000. Between 2000 and 2005, they represented 80% of that growth. Yet, only 12% of black fourth-grade students and 17% of Hispanic fourth-graders are proficient in reading, compared with 38% of whites, according to a report by the Center for American Progress, a public policy think tank.
In California, already a majority minority state, 11% of African-American and 9% of Hispanic fourth-graders are proficient in reading, compared with 36% of their white peers.
The achievement gap seen in elementary school is unlikely to close by the time most students enter high school. Down the road, only slightly more than half of all blacks and Hispanics graduate from high school in four years, compared with 78% of whites.
For baby boomers, the economic status of the new generation will affect more than the kind of quality of services the government available. It will also affect the value of a major asset for many boomers: their homes.
Prof. Myers's studies show a pattern of upward mobility into homeownership by immigrants and their children. By 2005, four of the top 10 surnames among home buyers nationwide were Spanish, up from only two in 2000. But young Latinos will become the largest market for the homes of white boomers as the latter seek to downsize or cash out in the near future.
A less-advantaged younger generation is less likely to be able to afford to pay top dollar for retirees' homes. "We need to cultivate new home buyers; it requires moving more Latino kids through high school and college," says Prof. Myers. "It's not for the good of Latinos. It's for the good of the nation."
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