Solvency: potential solutions meet a complex world

Many proposed reforms might have varying affects on retirees.

In the 1940s, if a man lived to age 65, the full retirement age (FRA), he would, on average, live another 12.7 years in retirement, while a woman would live another 14.7 years.[1] A man reaching today’s FRA, 66, will live an additional 18.5 years on average; a woman another 20.9 years.[2] One way to lower the ratio of beneficiaries to workers would be to raise the FRA, a frequently mentioned reform. However, recent research has shown that, even as average life expectancy has risen in the U.S., there has been since 1990 stagnation or increases in death rates at midlife for non-Hispanic, white adults, especially for those with less education. This difference in mortality would mean that raising the FRA or adopting policies to encourage longer work would affect various groups of people differently.

Many of the increased deaths in this population have been attributed to drug overdose, suicide, alcohol poisoning — so called “deaths of despair.” Some demographers theorize that “despair” deaths could be related to lower-educated workers’ increasing economic vulnerability during the last 50 years. Researchers John Bound, Timothy Waidmann, Arline Geronimus, and Javier Rodriguez explore the link between mortality, its causes, and local economic conditions in a recent working paper. In their project, the researchers use three data sources: the Center for Disease Control and Prevention System’s 1990 to 2015 Multiple Cause of Death files, which include individuals’ age, sex, race, ethnicity, educational attainment, and cause of death; U.S. Census population estimates controlled for differences in ages across populations by sex, race, year, and education attainment; and a pooled sample of American Community Survey data on employment growth by industry, in aggregate and by education.  To look at local economies, Bound and his fellow researchers combine data to the level of commuting zones as defined by the U.S. Department of Agriculture.

While the authors confirmed other research that showed increased death rates for older, working-aged, non-Hispanic white women, particularly those with high school degrees or less, they could not see strong links in the number of deaths of despair to local economic conditions. In fact, when there was a statistically significant relationship, it was more often seen in areas with less economic vulnerability.

“This finding, in particular, calls into question the hypothesis behind the term ‘deaths of despair,’” the authors write. “If the increase in these deaths were a result of economic despair, we would expect that areas hardest hit by industrial change would see the greatest mortality increase.”

Instead, the authors suggest looking beyond economic conditions to geographical variation in prevalence of opioid prescriptions/use and the availability of firearms for other potential explanations of differences in death rates.

The authors’ working paper provides details on their methods and findings.


[2] Numbers from SSA’s life expectancy calculator, which gives rough life expectancy estimates: