Friday, September 19th, 2014
True
Wolf
"In 1950, the average American lived for 68 years and 16 workers supported one retiree. Today, the average life expectancy is 78 and three workers support one retiree."

Frank Wolf on Friday, February 17th, 2012 in a news release

Rep. Frank Wolf says fewer workers are supporting more Social Security beneficiaries

U.S. Rep. Frank Wolf said the longevity of Americans is placing a strain on Social Security.

"In 1950, the average American lived for 68 years and 16 workers supported one retiree. Today, the average life expectancy is 78 and three workers support one retiree," Wolf said on Feb. 17 before voting against a 10-month extension of the Social Security payroll tax credit.

We wondered whether Wolf was correct about the life expectancy tallies and the ratio of the number workers supporting each Social Security recipient.

Let’s start with life expectancy:  A 2006 Congressional Research Service report said that from 1949 to 1951, the U.S. life expectancy was 68.1 years. The most recent data from the Centers for Disease control show that in 2010, the average life expectancy was 78.7 years old. So Wolf is right on this front.  

What about the numbers of workers supporting a Social Security recipient?

Dan Scandling, Wolf’s spokeman, pointed to an April 2011 fact-check from our colleagues at PolitiFact Georgia that examined a similar claim made by Mark Warner, D-Va., about the worker-to-retiree ratio in 1950 compared with today.

The story referenced historical data from the 2010 Social Security Trustees report. We looked at the latest trustees report from 2011 to get the ratio of workers to retirees on Social Security.

In 1950, there were 48.28 million workers paying into the system and 2.93 million receiving benefits. That works out to 16.5 employees for every Social Security recipient back then. In 2011, the latest year in which data was available, there were 157.8 million workers paying into Social Security and nearly 55 million receiving benefits. That comes to 2.9 workers for every retiree, close to Wolf’s number.

The decline in the ratio is driven by a number of factors.

Henry Aaron, an economist and senior fellow at the Brookings Institution, said in the early years of the system, many workers such as farmers and state and local employees weren’t eligible to receive benefits. Over the decades, more people from more professions have been admitted into the system. In the 1950s and 1960s, the eligibility age to receive Social Security payments was lowered from 65 to 62.

And basic demographics are at play.

"The ratio changed because Americans are living longer and retiring earlier," Bob Pozen, a non-resident senior fellow at the Brookings Institution said in an e-mail. "Moreover, the baby boomers -- a big demographic wave -- are starting to retire."

The Social Security Administration, in its 2011 trustees report, projected that unless changes are made, trust funds supporting the system will be exhausted in 2036 and full benefits would no longer be paid on a timely basis.

That doesn’t mean there aren’t ways to deal with the projected shortfall.

For the system to remain whole for the next 75 years, the Social Security Administration suggests the payroll tax into the system could be increased, benefits could be reduced, or some combination of the two approaches could be implemented.

Our ruling

Wolf said that 60 years ago, the average life expectancy was 68 years at a time when 16 workers supported each retiree on Social Security. Today, he said, the life expectancy is 78 and three workers support one retiree.

He’s right on the numbers and highlighting a demographic challenge the Social Security Administration acknowledges is placing greater demands on the system.

His statement is True.