The 2020 Long-Term Budget Outlook

Demographic Projections

The size and age profile of the U.S. population affects the federal budget and the nation’s economy. For example, the age distribution of the population influences the size of the labor force and the number of beneficiaries of Social Security and other federal programs. In CBO’s projections, the U.S. population increases from 334 million at the beginning of 2020 to 378 million in 2050, expanding by 0.4 percent per year, on average. That rate is slower than the average annual rate of growth over the past 50 years (0.9 percent). The share of the population that is age 65 or older also expands over the coming decades, continuing a long-standing historical trend. By 2050, 22 percent of the population will be 65 or older, whereas today that share is 16 percent (see Figure 6[12]). To estimate the growth of the U.S. population, CBO projects rates of fertility, net immigration, and mortality.

Figure 6.

Population, by Age Group

Millions of People

CBO projects that the population will become older, on average, throughout the projection period as the share of the population age 65 or older continues to grow.

Source: Congressional Budget Office.

Actual data are shown through calendar year 2018, the most recent year for which such data are available.

Fertility. In CBO’s projections, the total fertility rate—representing the average number of children that a woman has in her lifetime—decreases from 1.7 children per woman in 2020 to 1.6 children per woman in 2021 in response to the pandemic. The rate gradually increases to 1.9 children per woman by 2028 and remains at that level through 2050. That rate is below the replacement-level fertility rate of 2.1 children per woman that generally ensures that the population will remain steady, with no migration.

In general, the total fertility rate falls during recessions and rebounds during recoveries. Instead of rebounding after the 2007–2009 recession, however, the fertility rate fell from 2.1 children per woman in 2007 to 1.7 children per woman in 2019 (the most recent year for which data are available).15 That decline in fertility rates, which was largely attributable to fewer births among women younger than age 24, results in slower growth of the population in the future and reduces CBO’s projections of economic growth in the second decade of the projection period (2031 to 2040).

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