ket items. Today the engine that is driving our economy and our stock market is due to the lopsided demographics present right now. The coming of age of discretionary spending is allowing people to buy that SUV, boat, computer, etc that would have been put off in the past (Income). The economy is sensitive to the Boomer generations desire for a luxury lifestyle. As they look toward retirement, baby boomers are aware that Social Security may not be able to support them as it did their parents. This has led them to invest large amounts into 401k plans and mutual funds.Now that weve looked at the spending issues, lets see how the baby boomers have affected the workforce. When baby boomers began entering the workforce, they increased the size of the labor market. The job market has been greatly expanded with the coming of this generation, especially with the addition of women to the workforce. At times, the baby boomers faced relatively high levels of unemployment because they had to compete with one another for jobs. But eventually the jobs materialized. The average age of the workforce is steadily climbing. The first of the baby boomers will start to retire in large numbers after the year 2020.The retirement tack boomers end up taking in coming decades will have a profound, but unknown impact on the economy. As Peterson says, The forecasts range from impending doom to marketplace godsend. Some predict that as baby boomers retire unemployment will fall and that this process should begin by the year 2002 and that labor shortages should emerge about 2005. This will continue to get worse as the number of people who retire exceed the number who enter the workforce (Generation).Some economic observers predict financial disasters, both national and personal, when the baby boomers retire. They say that as nations of workers and investors become nations of retired consumers, withdrawals will far outweigh deposits in investment and savings vehicl...
