For impact on the overall Social Security system, this new statistic is significant for several reasons. It impacts the maturity of the workforce, it demonstrates the desperation of people who are exhausting their unemployment benefits. But more importantly for disability claimants, it adds one more factor to the delays already plaguing Social Security,
The LA Times reports today: “Instead of working longer as the economy worsens, more Americans are calling it quits before age 66. The ramifications could be profound for the retirees, families, government and social institutions.

Reporting from Washington — Instead of seeing older workers staying on the job longer as the economy has worsened, the Social Security system is reporting a major surge in early retirement claims that could have implications for the financial security of millions of baby boomers.

Since the current federal fiscal year began Oct. 1, claims have been running 25% ahead of last year, compared with the 15% increase that had been projected as the post-World War II generation reaches eligibility for early retirement, according to Stephen C. Goss, chief actuary for the Social Security Administration.: See full article here:

The New York Times reports that there will be no cost of living (COLA) increase in checks for 2010. Another impact of the bad economy for recupients of disability and retirment income. The Times says ” for the first time in more than three decades, Social Security recipients will not get any increase in their benefits next year, federal forecasts show.

“The absence of a cost-of-living adjustment, calculated under a formula set by law, will be a shock to older Americans already hit by plummeting home values, investment losses and rising health costs. More than 50 million people receive Social Security.
http://www.nytimes.com/2009/05/03/us/politics/03benefits.html?_r=1&hp See article here:

In Today’s New York Times, a litany of problems created by the economy. Budget cuts now for health care will create deeper costs later:
“Battered by the recession and the deepest and most widespread budget deficits in several decades, a large majority of states are slicing into their social safety nets — often crippling preventive efforts that officials say would save money over time.

“President Obama’s $787 billion stimulus package is helping to alleviate some of the pain, providing large amounts of money to pay for education and unemployment insurance, bolster food stamp programs and expand tax credits for low earners. But the money will offset only 40 percent of the losses in state revenues, and programs for vulnerable groups have been cut in at least 34 states, according to the Center for Budget and Policy Priorities, a private research group in Washington.: See Times story here: