2045: Macroencomics
What has inequity cost us?
According to research conducted by the Federal Reserve, between 1990-2019 we have lost $16 trillion in GDP dues to marginalizing and stunting based off race and gender. For most of U.S. history, white men have been upheld as the “standard bearers” and have primarily held positions of power. This has been easy to maintain when the ethnic majority in the U.S. has long been white people. However, this is changing.
How the Shifting Demographics Impact Monetary and Fiscal Policy.
With the inevitable shifting demographics in the U.S., there will naturally be macro-economic implications.
According to January 2025 projections from the Congressional Budget Office (cbo.gov), the Social Security area population, used for estimating payroll taxes and Social Security benefits (“which includes residents of U.S. states and territories, as well as U.S. citizens, federal employees, and service members living abroad), is projected to increase from 350 million people in 2025 to 372 million in 2055” (cbo.gov). This rate of growth however, will slow significantly over that time period. Between 2025-2035, the rate of population growth is anticipated to be at an average of 0.4 percent per year, but is expected to slow to 0.1 percent between 2036-2055. Immigration rates will become increasingly important. “Without immigration, the population would shrink beginning in 2033, in part because fertility rates are projected to remain too low for a generation to replace itself” (cbo.gov).
While the U.S. Congressional Budget Office looks at people ages 25-54 to determine the number of people who are employed and paying taxes (cbo.gov), they look at the number of people 65 and older to determine the beneficiaries for some programs like Social Security and Medicare. CBO, and the U.S. Federal Reserve, look more specifically at the middle class to determine the overall health of the U.S. economy. Total population size and the middle class determine our GDP.
An aging population puts more strain on Medicare and Social Security, while a shrinking population between 25-54 inherently means less tax dollars to cover these essential programs.
By 2045, ten years before we reach 2055, the available workforce in the U.S. will become majority minority, with white people making up less than 50% of the total population (brookings.edu).
For our economy to continue functioning the way it has, black and brown people must be meaningfully represented throughout the middle class, and not just at the very bottom level. Unfortunately, most organizations are not prepared to help reset this trajectory.
Our Response
We meet organizations where they are and advise them on ways to move towards not just meaningful ethnic representation but offer guidance and support as they strategically support talent of color at every level of engagement. Our services are uniquely designed to change the way people of color experience work throughout their time there.
Preparing now for 2045 is the macroeconomic imperative of our lifetime. We understand how serious it is and work with clients to unpack their beliefs around difference, help them to align their commitments to changing demography.
Check out our full list of solutions here.
Reach out to us to discuss how a Harper Slade advisor can join you on your journey.
-Jaeden Thomas