ABA Banking Journal - October 2008 - (Page 64a)

briefing The Economy MARK VITNER Senior Economist, Wachovia ADAM YORK Economic Analyst, Wachovia Aging population means a smaller labor force Growth in the real econoTHE FIRST BABY Minority population projections by race in millions my over the long-run is boomers turned 62 this 140 140 Asian comprised of two major year foretelling the coming Black Hispanic 120 pieces: increases in producsurge of an older popula- 120 All other tivity and increases in the tion in the United States. 100 100 size of the labor force. With As a larger portion of the 80 80 slower growth in the labor nation’s population enters force over the next four its retirement years, overall 60 60 decades, we will either need labor force growth will greater gains in productivity slow. The labor force (aged 40 40 or we will have to expect 21-67) share of the popula20 20 slower trend growth for the tion peaks relatively soon economy. at 61% in 2013 and falls 0 0 2010 2020 2030 2040 2050 Americans spent just 10% back to 55.8% in 2050. As of their total consumption a point of reference, this on medical care in 1975; this group currently accounts U.S. population of persons age 65 and over in millions year it has topped 20% of for 59.6% of the popula- 100 100 total expenditures. While tion. The elderly populaAge 85 and over Age 75-84 Age 65-74 the pace of growth has tion will balloon; there 80 80 slowed over the last few will be over 600,000 peoyears, as medical goods ple over the age of 100 in 60 60 costs were pushed down by 2050. And while those cheaper generic drugs and over the age of 88 make up lower co-payments, we do a mere one percent of the 40 40 not expect this to hold in current populace they will the long-run. An aging popreach 2.8% by 2050. 20 20 ulation will continue to By 2042, the minority demand more medical care. population is expected to 0 Add to this the cost of carreach majority status. 2020 2030 2040 2050 2010 ing for the retired populaWhile non-Hispanic tion through Medicare, and whites will still be a plurality of the population at that point, their population will the consequences reach past each individual’s pockethave peaked in 2031. By 2023 a majority of children will book. While we do not have regional breakdowns in these be from minority groups. Over the next 42 years, the Hispanic population will nearly triple while the Asian new projections, we continue to expect future populapopulation may more than triple. Both would see their tion growth to be concentrated in the same regions it has share of the populace nearly double over the time peri- been over the past 20 years. A handful of states, mostly od. Perhaps more importantly, the labor force is expect- in the Sun Belt, have accounted for more than two-thirds ed to become even more diverse over the next four of the nation’s population growth. We expect this trend decades, with minorities reaching more than 53% of to continue and for the big winners to be Texas, the Carolinas, Georgia, and Arizona. BJ those aged 21-67. www.ababj.com/subscribe.html OCTOBER 2008/ABA BANKING JOURNAL 64a http://www.ababj.com/subscribe.html

Table of Contents for the Digital Edition of ABA Banking Journal - October 2008

ABA Banking Journal - October 2008
Contents
Editor’s Column
A Banker's View of FHA's "Hope for Homeowners" Program
Snapshot: Branch Sales Sag to Ten-Year Low
Covered Bonds Gain Interest after GSE Takeover
ABA Chairman’s Position
ABA Resources
Hot, Web, and Green
Rethinking Segmentation
Still Pushing the Envelope
Keep Regulation Functional
Capital Windfall?
Mortgage IT: Not This Year's Hot Property
Case in Point: Looking for Sales in All the Right Places
Put Your BSA/AML Program into Shape
Mailbox
Banker’s Mart
To Advertise/Index of Advertisers
Remembering Joe Kizzia, Veteren Editor of ABA Banking Journal
100th Anniversary: Then & Now
The Economy

ABA Banking Journal - October 2008

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