Just the other morning I read two articles from Yahoo Finance which showed a couple of trends happening in American society.  The first trend can be read about in this article titled “There are more Americans out of work than their are jobs open for the first time since 2021″.

And the second article, that you can read about here, was titled “Retail spending is starting to look more and more like the labor market“.  Among other interesting facts the article makes this comment, “Consumers in the top 10% of the income distribution accounted for 49.2% of total spending in the second quarter, registering the highest level recorded since 1989.”

Reading those articles made me think about Death Care and how these economic indicators might come to play in the Death Care world.  While the ramifications of these indicators is wide, I have some thoughts that may or may not be correct assumptions.  I think the big take-away is simply to be aware of what is happening in our economic sphere and be prepared to respond with business decisions as you need to.

Labor —  Here is a quote from the first article concerning employment, “Unemployed workers are staying out of work for longer, even as layoffs remain low.  This suggests the shift is less about an increase in people losing jobs and more about a decline in job openings.  In other words, the challenge right now lies less in job security for those already employed and more in the difficulty of reentering the labor market once you’re out of it.”

In the funeral director and/or mortician sphere finding quality help continues to remain one of the top concerns of funeral home owners and managers in almost every survey that comes out.  And, the latest latest job placement statistics I have is that in 2024 there were 2,106 graduates of mortuary science schools across the U.S. and 84% of them found employment.

I’m wondering if emloyment is “tightening up” among funeral homes and if it is that may bode well for companies in keeping their personnel costs from increasing at a higher than inflationary rate.

I’m also wondering if a decline in job openings in other occupations might spur more people to look to funeral service.  Many people who don’t understand all the nuances of funeral service look to the profession as one with a “secure” future.  Latest statistics also tell me that there were 3,363 new enrollees in funeral service programs so, I believe that, the pipeline looks good for future employees.

It very well could be that a tight job market in other occupations brings a better outlook for funeral home owners and managers as more and more people may look to enter the Death Care field.  With demograpahic indicators suggesting that the number of deaths in America will rise over the next 10-20 years, this would be welcome news to the profession.

Disparity of Consumer Spending — There is a lot to document that the wealthiest in our society are spending more and the lower end of the economic population is spending less as inflation keeps a hold on an elevated number.  Many economists suggest the United States economy is on a “K-shaped” recovery method as those who have extra assets that are invested are gaining at a greater than average rate and those with less or no invested assets are seeing buying-power erode  —  hence, the statement from above where “Consumers in the top 10% of the income distribution accounted for 49.2% of total spending. . .”

One of the easiest areas to see this is in the hotel sales sphere —-  Here’s what one economist suggested, “That lower-income households are seeing weaker income growth is one explanation for why demand is weakening for the most affordable lodging options.”  So as low-cost hotel chains such as Choice and Wyndham are having difficult times the more luxurious chains such as Hyatt, Hilton, and Marriott seem to be doing just fine.

Tom Anderson
Funeral Director Daily

So, what does that disparity of consumer spending mean for funeral homes?  You might argue that those with lower means will feel financially unsecure at the time of death and opt for lower priced services such as direct cremation.  I don’t necessarily think that is true because there are so many variables in the choice of Death Care disposition and so many personal opinions and choices.  While in-hand assets will make a difference to many at the time of death not everybody will lower their choice standards because of a temporary lack of available funds.

I’m not so sure that funeral homes can survive a “K-shaped” economic recovery “if” only about 10% of the populous does almost 50% of the death-care spending.  In an economy where the other 90% of the population spends the other 50% I’m not so sure that those Death Care services would bring much in the way of margins.  That’s why it is imperative that funeral homes can give options to families who may be temporarily low on funds because of an economy that is costing them more than normal for simple-living necessities.

Will this situation lead to more crowd-funding such is available with the funeral service profession’s expert at such Treasured Memories Community Funding?  I don’t know, but it would probably be wise for all funeral homes to know how to access that option for those client families that may need the help.

Funeral homes are a different business. . . one in which one person equals one death call — and where each death call equals only one purchase.  Other areas of the economy could have one person buying six televisions or one person buying three cars.

In a world where cars or televisions are sold all that really matters is that enough are sold to be profitable. . . . .In the funeral home business the number of deaths (and sales) are finite at one per person and in a country where there is greater wealth inequality than prior years, forcing lower-priced choices by the masses, would probably not be as lucrative as it once was for those businesses.  In that sphere it becomes necessary that all families are able to access the funds necessary for the services that they prefer  —  if they can’t do that, that doesn’t bode well for those businesses who depend on the margins provided by those services.

My dad used to say that “Blue-Collar” families are the backbone of funeral service.  As the middle-class of America seems to be shrinking in lieu of wealth on one hand and financial struggle on the other hand, who will become the backbone of funeral service?  That’s maybe a great question.

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Last week the country of Denmark once again set in place an increased age for receiving government sponsored retirement benefits.  As you can see in this article those citizens of Denmark born after 1970 will not be able to access this benefit until age 70 — up from the current age of 67, with gradual increases to the 70 mark moving forward.

As you may know, the United States, in most instances, lets citizens receive pre-retirement benefits at age 62, full benefits at age 67, and increased beginning benefits at age 70.  For each year that one delays taking those benefits an increase of 8% on your beginning benefit is earned. Here’s a chart on how those benefits might look like at different ages for someone set to receive $2500 of benefits at age 62.  (Note:  Annual Cost of Living Adjustments are not figured into the Cumulative Value at Age 80)

While the United States life expectancy rate for children born today sits at 77.4 years overall, the life expectancy rate for someone who has lived to age 65 sits at 83 years for males and 86 years for females.  So, calculating only until age 80 may be short and one who collects the higher amount at age 70 may eventually pass the 67 year old in lifetime benefits as they continue to age.

While I picked the $2,500 figure somewhat out of the air, according to the Social Security Administration, maximum initial benefits for today’s retirees in 2025 are $2,831 at age 62, $4,018 at age 67, and $5,108 at age 70.

How Does the Retirement Age and Life Expectancy figure into your Preneed Marketing?:

I will give you a couple of thoughts on how I looked at Preneed marketing and what worked for us.  To understand my thought process you need to know that I came into the business world the same year that Ronald Reagan became President and First Lady Nancy Reagan staunchly supported an anti-drug program in the United States named “Just Say No”.  Part of the “Just Say No” program was to educate children at younger ages than ever before about the negative aspects of illicit drug use.  The thought process was letting them know at younger ages simply gave more awareness and importance to the program.

• I picked up on that younger and younger education and eventually realized that we should not simply be waiting for people to walk in the funeral home door who had been told that setting aside money for an eventual funeral was a way to legally “spend-down” to help with government paid nursing home care.  Oddly enough, prior to about 1980 the thought of “soliciting” people to pre-fund their eventual funeral was thought of by many funeral operators, including myself, as potentially bad public relations that could harm your business.

• About 1990 we became bold and started sending out mailers for funeral pre-arrangement to those 65 years of age and older.  Prior to that it was only the insurance companies themselves who sent out the mailers.  That thought process kept the funeral home from looking “too solicitous”.

• In 2001 we started doing monthly small-group, one-hour seminars, aimed at those 65 and older.  We bought mailing lists, composed the letter ourselves, and offered a $20 restaurant gift certificate per couple for attending and found, through trial and error, that if we sent out 200 mailers, we would have about 10-12 couples attend which was not too many . . .  but our closing rate on those couples was about 70% — meaning we sold about 12-16 policies from that meeting.  We used a very simple in-house developed questionaire that led couples into asking for an appointment with a pre-arrangement counselor.

• One thing we learned over time was to pre-screen our mailing list and as we refined it our results became even better.  I remember that one of the big items that we screened for was “home ownership”.  People that didn’t own a home did not get an invitation to a seminar.

• At that time we were doing about 160 at-need cases per year so the seminars brought in about 70-80% of our at-need volume.  We realized that this would grow volume over time.

• A few years later we experimented with the Nancy Reagan philosophy of trying even “earlier ages” and was surprised at the number of still-working couples who took a morning off of work to attend the seminars upon invitation.  We also moved our philosophy of saying this is something “retired people” should plan for to bringing a mantra of “when you are starting to think of retirement, you should not only plan for when you will take Social Security, but you should also think of your will, your legacy, and your funeral arrangements”.   A big part of our seminars was the suggestion telling potential clientele that they should have serious discussions about their choice of cremation or earth burial and where the permanent memorialization of their cremated remains or casketed body would be.  We found this “optionality” of decisions moved people to the discussion stage.

• I found that having the discussion about permanent memorialization probably moved more people to pre-arrange than did the discussion of cremation/earth burial.  In many instances family lots were in different cemeteries and the couple needed the discussion to decide which to make use of. . . . or, our closest National Veterans Cemetery was 140 miles away and a discussion about using that cemetery versus a local cemetery often was a reason that couples took up the conversation.

• Over the years we were able to move our preneed business to a situation where we had a one to one ratio with at need calls which I think, in today’s world, should be a minimum ratio for businesses that want to grow.

• While we did have acquisitions to increase our call volume, the decision to make Preneed as big a priority as At-need played a major role in our organic growth over time.  My brother, Dave, took on this mantle and it went from a part-time gig to a more than full-time one when we needed to hire a 2nd part-time agent to folow up on seminar leads.

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  My direct take on the question posed in the title of this article is that retirement age should not affect pre-need.  My reason for saying that is because you should already be prospecting the “before retirement” cohort of potential clients.

On the other hand, it may make a slight difference on the potential client’s reaction to your lead generation.  They may think that “they have plenty of time to do this” because retirement is far off.

If you don’t do monthly seminars I would suggest a call to my friend Patrick Zalusky at Laker Planning (507.327.6938) to get some pointers on how to start.

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It probably does not matter which side of the political spectrum that you straddle in anticipating that what is happening with the new Department of Government Efficienty (DOGE) will change some things as they are related to current government payment systems.  Whether you are for or against the effort by DOGE it does appear that over time some things will change.

And, I’ve been around long enough to know that when something catches the attention of the public on a national scale the process eventually works its way down to the local scale.  I can see that happening with the DOGE effort and an accounting of expenses coming to state budgets, public university budgets, school district budgets, and local budgets.

So, how might that affect your funeral business?  The first situation that comes to mind for me is in payments to funeral homes and their care for indigent individuals.  In most areas this is a budgeted item of state, county, or city governments.  I’m of the thought process that the DOGE philosophy will trickle down to these local governments and the amounts that they pay for the death care of their most vulnerable citizens may come into question by some. . . . and the search for savings could affect your payment amount from the governmental unit.

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  When I was operating my funeral home we did about 300 funeral cases annually, more or less.  Anecdotally, I’m guessing that we had one governmental paid service each month which would equal to about 12 per year or 4% of all of our case volume.

My philosophy was probably different from a lot of funeral directors in that I never objected to the amounts that our county paid for these services even though it was generally below our cost of producing the services for the deceased individual.  I felt grateful for my position in the community and was willing to help those less fortunate than myself, to a certain extent, whenever I could.

In addition, I knew that our county’s money for such services came from the collection of property taxes and I never wanted my property taxes to increase.  In essence, I would have felt hypocritical if on one hand I advocated for the lowest possible property taxes while at the same time advocated for higher payments by the county when the money was being sent to me (indigent services).  I was happy to help people in their time of need. . . . and if you really think about it, because we were a profitable business, that 96% of clientele that fully-paid for our services subsidized our indigent service business. . . . . it is just another one of those “hidden taxes” that people of normal means pay in our society for the benefit of others.

One thing that did bother me about those indigent services is that the funeral home and, in many instances, the cemetery took discounts to help the deceased indigent family whereas suppliers to our industry did not.  For instance, the funeral home services were either discounted or free and many times cemeteries had to discount or offer free graves, while our suppliers such as casket companies, vault companies, and other suppliers to funeral service received their full payment of wholesale goods.

There was a practicality to that. . . the county paid one company — the funeral home — that supplied the rest of what was needed.  The funeral home had to then pay the suppliers, and I guess we could have asked our suppliers for discounts off of their invoiced amount for these services — but we never did.

Compare that to how our federal government pays for food for indigents.  In that realm, it’s my opinion that grocery stores and their suppliers are paid full prices for the goods that they sell.  I just find it interesting that for whatever reason, funeral homes have always been asked to discount their prices for the services provided to our most needy paid for by our government units.

It again proves that “compassion” is part of funeral service and serving “humanity” is what we do. . . . . .and, I’m glad we have that attitude.

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“A servant’s attitude guided by Christ leads to a significant life”

Prior to Christmas this past month I listened to my pastor preach on “Loneliness”, and loneliness specifically as it relates to the Holiday Season.  You see, she pointed out, that while many of us are excited to see family and friends during the Holiday Season, there are a whole lot of people who become isolated and get a terrible sense of loneliness because of the holidays.

She pointed out, even though we believe that technology ever-increasingly “connects” us, there is a thought process that all of the technology that we have around us “dis-connects” us instead.  She pointed out that many in our society don’t have someone we trust to visit with about our specific situations and instead we just put our news out there on Instagram, TikTok, or Facebook for our connections.

Tom Anderson
Funeral Director Daily

In essence, over time, we have moved from an intimate discussion society with friends and family to an “Instagram society”. . . . It was pointed out that the percentage of people who feel lonely at some point during the year has grown from 47% to 58% during the time period of 2017 to 2024 and at the holidays it rises to 61%. . . . . . That’s a lot of loneliness for the most technological society in the history of the world.

And, I would argue that loneliness not only hurts our mental health situation leading to a country that spends almost 20%, and rising, of its Gross Domestic Product (GDP) on health care, but also puts a direct hit on the revenue brought to the Death Care profession.

You see, in my opinion, it is the intimate discussions that we have as a family that leads to how we tell those we love how we want to be remembered.  And, in many ways, being remembered leads to the services and memorialization that we are willing to spend on at that time of death.  Absent those intimate discussions about legacy and remembrance I’m of the opinion that many families will not give extra thought to the ideas others may have had and opt for simple and easy solutions. . . . like direct cremation with no services.

Here’s a couple of graphs that I think show a stunning example of how we spend our time:

Time Spent with Friends is Decreasing

Who we spend time with as we age

So, for a long time we have written off the lessening of services purchased by our client families for many reasons. . . such as the decreasing of church memberships. . . . . But, maybe, there are many more reasons, with loneliness being one of them.

If nothing else, this data certainly reflects to the Death Care profession how important it is to get potential clients to open up to someone about their legacy and memorialization wishes.  The National Funeral Directors Association (NFDA) has been in front of this movement with their “Have the talk of a Lifetime” promotion. . . .which you can access here.

Related Article— “America has a loneliness epidemic.  Here are 6 steps to address it.”  Short audio version and print article.  MPR News (Minnesota Public Radio)

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“A servant’s attitude guided by Christ leads to a significant life”

Back when I was a child there was a soap opera daily on television that carried the slogan, “Like sands through an hourglass, so go the Days of our Lives”.    I thought of that today when researching an article about demographic movements and how they may affect funeral homes in the future. . . .My thought process kind of went like an hourglass timer, the sand keeps moving slowly and we keep moving with our daily lives while things slowly change around us.

Before you know it, years go by and lots of things have changed. . . . and if our business does not change with those changes, what we do in that business may become obsolete.  It just happens. . . think of standard landline telephones — everybody had them, some started believing they could get by with only a cell phone.  Boom. . .does any home have a landline anymore?  They have just disappeared. . . .and I sense that happening with cable and satellite television reception — soon it will be all streaming.

You cannot afford to wake up and realize that all the American demographics have changed and they have changed to a point that there may not be a profitable critical mass of population in your area to give business to your funeral home in a profitable manner anymore.  There are trends you need to watch.

Again, things happen while we are going about our business and then –Boom!!!  Things have changed.  I woke up a couple of mornings ago and realized that the state of New York no longer has the most finance jobs in America.   They have now been overtaken by Texas in that capacity.  You can read for yourself in this recent article from Yahoo Finance.

Since the pandemic we have heard about Texas gaining jobs and states like California and New York losing jobs and their business climates suffering. . . and we saw the trickle. . but now — Boom! — It has happened.

It’s not the first time something like this has happened. . . .Homes and businesses started putting air conditioning in their buildings starting in the 1950’s and that lead to a 5-decade surge in population and growth in the south and southwest.  Now, the South and Southwest have very populated states and one city, Atlanta, has the busiest airport overtaking New York and Chicago— could that have happened without air conditioning?  That’s just one example of things changing due to the demographics and population changing.  Here’s a couple articles on that movement happening:

Tom Anderson
Funeral Director Daily

Demographic change is happening all around us right now, too.  America is becoming more urban, more diverse, and there is a movement from what are seen as higher tax states to lower tax states.  One of the unique ways that this “inter-state” movement is quantified is by how often U-Haul trailers leave “under load” from one state to another.  Here’s an article on that which shows that Texas, Florida, North Carolina, South Carolina, and Tennessee are the most desired destinations.  “Loaded trailers” leave the most often from these five states — California, Massachusetts, Illinois, New Jersey, and Michigan.

Demographic change is also happening in the rural and urban environment.  On a whole in the last 40-some years America has become more urbanized with approximetely 82.7% of our population living in urban/suburban areas in 2020 as compared to 73.7% living in urban/suburban areas in 1980.  That percentage of the population equates to over 100 million more people living in urban/suburban areas over that 40 years.

Rural population has not only decreased percentage wise from 26.3% of the population in 1980 to about 17.3 percent of the population in 2020, but in raw numbers of population.  Even with a total growth of population in the country, there’s about 2 million less people living in a rural area in 2020 than in 1980.

So, why does this relate to funeral homes and funeral business.  If you are in a state that is losing people or you are in a rural area, growth in an organic way, may be difficult to find.  If you find yourself in this situation and enjoy what you are doing and plan to do so for some time, I might suggest looking at an acquisition or more to help with the raw death call numbers and grow to an efficient economy of scale.

On the other hand, if you are in a growing state and/or urban/suburban market you certainly could look at acquisitions or you might decide to not spend on acqusition costs if you believe that you can “draw” new clientele to your facility through marketing or through an additional location in your market.

My main goal with this article is not to give a definitive “one size fits all” panacea for demographic change, it is to make you aware that even though these types of change do happen ever-so-slowly over time, you should, none-the-less,  have a plan to address whichever situation you find your business and its demographic changes in.

Related — Nation’s Urban and Rural populations shift following 2020 Census.  United States Census

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“A servant’s attitude guided by Christ leads to a significant life”