Why Social Security isn't enough

Old or young, if you missed the Social Security story in the Aug. 10 Press, read it now on cdapress.com. This problem affects everyone except the very rich, and requires planning.

Yes, even including those still working, the sheer numbers of Boomers soon drawing Social Security benefits strain the system in an unprecedented way.

No, younger workers who work as long won't get the same benefits, even if Congress can finally work together to address it (if not, they won't get any).

That's not because Boomers outnumber younger workers paying into the system; in fact, the opposite is true. According to the U.S. Department of Labor, the general population is expected to grow 50 percent in the next 50 years. Death rates will increase, says Labor but birth rates and immigration traditionally outpace that, even with Millennials marrying later and having fewer kids.

So if we have as many or more workers in the system, why are we running dry? One, as Monday's story described, the Social Security system has never been hit with this many retirees at once, and the system was designed with long-term interest and evenly paced growth in mind. Two, man's increased longevity means people draw benefits longer and have more health problems in later life, both which cost the system more than before.

But that's just the beginning of a complex answer. Much of the rest lies in economic shifts - effects of a market-changing recession, increasing automation (smarter machines mean fewer workers), and the proliferation of part-time and contract work that have replaced jobs which used to be full-time.

That's much cheaper for employers, both in wages and benefits. It also results from technologies which now permit working from home, across town, or across the globe in a virtual, rather than on-location, team.

However, it's not so good for economic growth and Social Security - in the capitalized and general sense. America's 48 million people in low-wage jobs and underemployed workers pay less into the economy and Social Security. And they can ill-afford rising food and fuel costs, let alone retirement savings.

Yes, we have job growth in recent years. But how much of that has been in high-paying, full-time, benefitted positions? Very little.

According to the Bureau of Labor Statistics, fewer than half of U.S. workers work full time. Encouraging drops in unemployment statistics exclude many people who aren't looking for jobs because they've given up entirely.

The number of part time jobs continues to soar relative to the decreasing number of full-time jobs. On July 13, 2014 the Wall Street Journal reported the number of involuntary part-time workers had nearly doubled from 4 million in 2007 to 7.5 million in 2014, with low-paying jobs representing 44 percent of all employment growth since employment hit bottom in February 2010.

In the 1960s, only one in 20 American men aged 25 to 54 was not working. Now, according to former Treasury Secretary Larry Summers, it's closer to one in seven. This level of unemployment and underemployment, despite expansive monetary policies and fiscal stimuli, begs bigger questions than economic cycles or policies can answer. America is changing, in a changing world economy, and needs to think outside the same old, finger-pointing boxes to address it.

Sholeh Patrick, J.D., is a columnist for the Hagadone News Network. Contact her at [email protected].