Nonprofits should keep up with the changing trends and needs of an aging population
The aging of "baby boomers" — Americans born between 1946 and 1964 — will reshape legislation, policy development and social services for decades to come. Following are specific developments that could directly affect the programs and services of your nonprofit. Read more on how aging populations are changingin the US.
Demographic trends — an overview
Statistics from the Population Reference Bureau describe how baby boomers will age in ways that differ from their parents:
- Dramatic increases in people age 65 and older. Between now and 2060, the size of this group will more than double — from 46 million to over 98 million. By 2030, we will be able to call one in five Americans an "older adult."
- Increased life expectancy. In 1950, Americans could expect to live to age 68 on average. By 2013 that increased to age 79.
- Higher educational attainments. People who complete a degree beyond high school tend to live longer and experience fewer health problems than their less-educated peers. On the whole, baby boomers are the best-educated generation in our nation’s history: In 2014, 25 percent of people age 65 and older had a bachelor’s degree or more. In 1965, that was true for only 5 percent of people in this age group.
- Declining poverty. In 1966, 30 percent of Americans age 65 and older lived in poverty. Today only 10 percent of older adults are poor.
- An aging workforce. Compared to previous generations, baby boomers are more likely to stay in the workforce on a full- or part-time basis after they turn 55. About 26 percent of people in this age group will still be employed in 2022 — up from 12 percent in 1990.
- A "diversity gap" between younger and older Americans. Our nation’s ethnic and racial diversity is increasing overall. However, this trend is currently driven by younger people — not baby-boomers. Today, nearly three-quarters or people age 65 and older are still white and non-Hispanic.
- Rising divorce rates. Recent data point to a "gray divorce revolution." Divorce rates have increased steadily since the 1960s. And baby boomers have divorced more often than previous generations.
- Increasing demands for elder care. By 2030, 2.3 million Americans age 65 and older could require nursing home care — up from 1.3 million in 2010. We can also expect a steep rise in the number of people living with Alzheimer’s disease: 14 million by 2050, compared to 5 million in 2013. Factors such as these will drive up Social Security and Medicare expenditures to 12 percent of the gross domestic product by 2050.
- Caregiving challenges. Baby boomers who divorce and never remarry can no longer count on a spouse to become a primary caregiver in the latter stages of life. Even those who remarry may have weaker bonds with their extended families, which complicates caregiving arrangements.
The "oldest old" — a demographic all its own
Between today and 2060, the number of Americans age 85 and older will more than triple — from 6 million to 20 million. This trend alone will trigger major shifts in public policies and elder care:
- The oldest Americans have the highest rates of disability and are the most likely to need long-term care.
- Medicaid is the major source of payment for long-term care, and increasing costs for this program could strain state and federal budgets.
- Slower growth in the working age population mean that fewer Americans will be taxed to pay Medicaid and other public programs.
- Nearly 56 percent of women 85 and older live alone, creating more complex needs for caregiving.
Breaking down trends in aging
While these demographic trends are wide-sweeping, they are also complex. Look for underlying tensions and varying effects on different groups within the aging population.
Case in point: older Americans traditionally depend on a variety of income sources — salaries and wages, Social Security benefits, employer pensions, and retirement savings. While this will remain true for aging baby boomers overall, we can expect disparities based on:
- Racial and ethnic divides. In 2013, about 20 percent of older African-American and Latino adults depended on Social Security as their sole source of income. The comparable figure for white older adults was 13 percent. In 2014, 19 percent of African Americans age 65 and older lived in poverty, compared to 8 percent of older non-Hispanic whites.
- Differences in life expectancy. Even though the gender gap in life expectancy is decreasing, women still tend to live longer than men. For this reason, women will need to stretch their financial resources over a greater number of years — a challenge for aging adults. As they turn 75, in fact, women are twice as likely to be poor than men of the same age.
- Wage discrimination. Members of racial and ethnic minorities have less income from pensions, savings, and other assets. Women's lower income over their working years compared to men also leads to lower retirement benefits, adding to financial stress in later life.
What this means for nonprofits
Demographic trends are based on "hard" data such as age and education levels. But equally important for you as a nonprofit leader are related changes in psychographics — the attitudes and behaviors of your constituents. It’s time to start asking questions such as:
- Will our older constituents who continue to work have less time to volunteer — but more money to donate?
- If our baby-boomer volunteers are less diverse racially and ethnically than our younger constituents, will this call for us to develop more cultural competence?
- Will the surge in aging baby boomers lead our funders to favor services for older adults (such as home health care) over programs for younger adults (such as workforce development)?
- Do our constituent relationship systems have enough power to track people who live for two or three decades after turning 65?
- Could we support our mission by developing new services and programs for older constituents?
The bottom line for nonprofits is to anticipate the challenges — as well as the opportunities — presented by the seismic shift in aging Americans.