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Funeral Industry Prepares for Potential Historic Windfall: Death of the Baby Boomers

Beyond the convention center filled with glistening hearses, beyond the rows of perfectly arranged caskets and bottles of embalming fluid, funeral directors await perhaps their greatest windfall ever: The death of the baby boom generation.

For thousands of professionals gathered here at the National Funeral Directors Association convention, the current economic slump does nothing to dampen longer-term hopes pinned to the projected rise of the U.S. death rate as the cohort born between 1946 and 1964 passes away.

Though dipping slightly over the last several years, and expected to be stagnant for several more, the death rate of about 8.1 per 1,000 people is expected to inch significantly upward sometime in the next decade and eventually go as high as 10.9. The exact dates are tough to pinpoint because of the size of the generation and medical advances.

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Experts say the mortality rate is the greatest single predictor of the industry's business, estimated at about $11 billion annually at funeral homes alone. So bottom lines are likely to bulge.

"It sounds kind of morbid, but they are looking at boom times," said Tara Olson, the owner of AllPoints Research, a marketing research firm that has worked with funeral homes to develop business plans. "They're just sort of waiting for the baby boomers to start dying off."

Because of the high startup costs of getting into the business, the surge of customers is expected to be served by roughly the same number of funeral homes as now. Dan Isard, whose Phoenix-based The Foresight Companies consults with funeral homes, says he expects the average funeral home to go from serving 120 families a year to 165, before the death rate drops off again around 2040.

"It's a good thing," he said, "but how much of a boom it's going to be is open to conjecture."

Isard and others note cremations, which generally cost less than burials, and questions about what else boomers will want could mean the amount spent on each service goes down. And it's possible that some families may turn to event planners to take care of funeral arrangements and just use funeral directors for essentials such as transporting and embalming the body.

"Other than the fatality, what's the difference between a wedding and a funeral?" he asked.

To that end, funeral directors say they try to set themselves apart with caring touches and a willingness to accommodate any type of memorial a person wants, made easier by the endless parade of products on display at the convention.

There are New York Yankees caskets with pinstriped interiors, wicker caskets for the eco-conscious, caskets for firefighters and Star Trek fans, even caskets with digital photo displays on the inside cover. Urns are disguised as marble lamps, wall paintings and Gund teddy bears. They're fashioned in the shape of Buddha, made of rock salt or paper to dissolve in the sea, even sold as small aluminum cylinders that fit in the stock of a rifle.

Some in the industry fear they won't have adequate staffing to meet increased demand, but they're trying to attract those seeking second careers and to change licensing laws.

They say economic woes are being felt now, but not nearly as bad as in other businesses. Funeral directors say they've had to absorb some price increases and that some customers have cut back by not using a limousine or by buying a less expensive casket. But there hasn't been a drastic change, and they're not expecting one.

For now, funeral directors milled the floors of the convention center here, in a surreal world where people in Snow White and Tinkerbell costumes hand out flyers for a funeral webcasting company and a marching band performs near a display of tiny caskets for children.

Chocolates come in the shape of coffins, boxer shorts have jokes about cremation, and giveaway calendars devote months to products such as JaundiBalm ("Toughest against jaundice!")

Excitement builds around the most mundane products.

Some convention-goers tested out a device used to lift corpses by being lowered into a coffin, then back unto a table. "Best thing ever invented," one exclaimed.