©1998 Larsen

How many people believe people are living longer today than in 1937? Many believe the retirement age should be increased because life expectancy has increased. But what is life expectancy and how is it calculated. I was curious as to the effect of decreased infant mortality rates on life expectancy and decided to investigate the method used for calculating life expectancy.

In simple terms, life expectancy is calculated by summing all people who are expected to be alive between ages 0 and 119 and dividing this sum by the total number who are born. The Table below lists the life expectancy for males, females and both. It also lists the infant mortality rate for those between ages zero and one. Be decreasing the infant mortality rate from 8.59% (1937) to 0.799% (1994), life expectancy increased from 70.20 to 76.10 years or 5.90 years.
1994 72.19 79.00 76.10 0.799%
1937 67.11 73.28 70.20 8.59%

What is more interesting is the life expectancy in 1937 jumps to 75.70 years at age one. When compared to the life expectancy of today's one year old's of 75.70 we find there is statistically no difference in life expectancy. Of course between ages one and eighteen there has also been a drop in mortality which further increases life expectancy. While at the same time the number of seniors who would have died sooner are living longer. Therefore, how does one actually evaluate overall life expectancy?

What affect does increased life expectancy have on OASI benefits? Well they have absolutely no effect at all. Those babies who died would never pay into OASI and would never collect any benefits. What is important to look at is the number of babies who live past age 18. Age 18 is the age when people should begin to pay FICA in greater amounts. It is not until age 62 or 65 depending on birth year, that OASI benefits would be paid out.

For those interested in life tables, I invite you to study this table Life Expectancy Table For 1937.

Life Expectancy Table For 1994

Now this is not a complete analysis and is only done to show just how much life expectancy can be changed by one particular attribute. It is true that medicine has greatly improved, but does it really play a large roll in increasing life expectancy of those over 65? How many pace makers are there? How many heart-by-pass operations are done each year? To change the life expectancy at this age, there must be a great number of people who benefit from this and also who see increased number of years. If the overall percentage of the population is low (<5%) who benefit and the number of years added to life is less than ten years, then the overall effect is less than 1 year overall. There just is not enough weight behind these numbers as there are with 8.59% infant mortatlity. Here you are averaging in a zero and lots of them with people who live to 65.

Can increased life expectancy really be blamed for Social Security's woes? Can increased life expectancy be the basis for increasing the age of retirement?

Life Table for 2002

Period life tables 1900 to present

Cohort Life Tables for U. S. Social Security Area by Year of Birth and Sex