As far back as 1960, the American economy has benefited from strong growth of the 20-to-64 age group, historically considered the primary source of the labor force. However, starting around 2010, a demographic shift will begin, resulting in a large

increase in the 65-and-over age group and a decline of the 20-to-64 age group. The Social Security Administration (SSA) reports annually on how projected demographic trends are likely to impact the Social Security trust fund income. Unlike the 2000 U.S. Census data, the SSA data is particularly useful because the projections are updated annually and take into account factors such as anticipated fertility, mortality and immigration rates. This is the scenario that the SSA considers most likely to occur. Starting in 2010, the demographic growth-rate balance starts to shift, and by 2015, the 65-and-over age group starts to grow at a faster rate than the 20-to-64 age group.

Looking at this data, it is easy to see why some sources have projected dire consequences for the U.S. economy caused by widespread labor shortages. But this is not the whole story. The U.S. Bureau of Labor Statistics (BLS) projects a labor force of 162.3 million individuals in 2012 and expects that the economy will require 165.3 million jobs to be filled. But this does not mean that there will be a shortage of 3 million workers in 2012. Find the talent you need today. Post your job on Yahoo! HotJobs.

Beyond the fact that these two numbers are not directly comparable, there are other variables at play that directly impact how organizations will be able to adapt to the changing demographic landscape. Some of the factors that organizations can control include retention of older workers, correcting gender imbalance in certain positions, the use of outsourcing and hiring newly arriving immigrants. Maximize your marketing ROI with Yahoo! Sponsored Search. Sign up and get a $25 credit.

Over the past few decades, the U.S. economy has benefited from a labor force that has grown faster than the overall population. However, it is projected that starting in 2010, the labor force starts growing at the same or a slower rate than the overall population. There are several reasons for this. The first is the impending decrease in employment participation among the aging baby boomers. Even if baby boomers are more likely to keep working past age 66, eventually their participation rates will start to negatively impact labor force growth. A second and less obvious reason that the labor force has been able to grow so rapidly over the past few decades is the increase in the participation rate of women.

Several factors encourage older workers to stay in the workforce longer. First of all, the age requirement for receiving a full Social Security pension will eventually rise to 67 for those born in 1960 or later. Second, the trend toward offering defined contribution pension plans that will pay out more the longer you work, instead of defined benefit plans, which pay out at a specific retirement age, is encouraging workers to stay in the workforce longer. Third, and most importantly, older Americans are healthier than ever before and are less likely to want to take a traditional retirement just because they hit the golden age of 66. Recent surveys have found that 79 percent of boomers plan to work in some capacity during their retirement years.

The plan of older workers to keep working will result in a highly age-diverse workforce. Organizations will need to find innovative ways to meet the needs of their age-divergent employees. Organizations must consider how to attract and retain older workers while meeting the development and career needs of younger workers.

Another factor to consider is gender. In the 1960s, women started entering the workforce in great numbers. As a result, the U.S. labor force started growing faster than the overall population. However, women’s participation rate in the labor force is starting to reach parity with men’s. The participation of both men and women in the labor force is now driven predominantly by the increase in population.

Over the past few decades, organizations have benefited from increasing numbers of women entering the workforce. At the macro level, this supply of talent is now tapped out. At the micro level, organizations may need to do more to maximize their gender pool. For example, positions that have been dominated by either gender may have to bed to the excluded gender. Again, organizations will need to work smarter to attract and retain qualified workers, regardless of gender.

American organizations also have looked toward immigration and, more recently, outsourcing to other countries to meet their labor needs. Although this trend will undoubtedly continue to help fill the baby boomer gap, organizations may start to experience increased difficulty attracting skilled labor from these alternative sources. While the SSA estimates relatively stable levels of immigration through 2040, the same demographic changes that impact the American labor market also affect most other countries. The United Nations projects that the average age will increase for most countries around the world, with developed nations impacted only slightly more than developing nations.

Just as the baby boomers have impacted every other age group they have moved through, they are about to reinvent what it means to be old. Baby boomers have the resources and soon will have the extra time to kick off a discretionary spending spree the likes of which the world has never seen. Estimates by various study groups indicate the 50-and-older group currently earns almost $2 trillion in annual income, controls more than $7 trillion in wealth, owns 77 percent of all financial assets in America and represents 50 percent of all discretionary spending power.

Enter ZIP Code: