The recession has hit Social Security and Medicare hard pushing their deadlines for insolvency up, a new report by the programs’ trustees revealed. The Obama administration released the results of the report Tuesday.

Since the recession began in December 2007, the country has shed 5.7 million jobs, driving the unemployment rate to 8.9% in April 2009. Fewer working Americans means less money paid into the trust funds for both Social Security and Medicare. Social Security is now expected to begin paying out more in benefits than it will collect in 2016, due, also in part, to Americans’ increasing life spans and the 78 million baby boomers retiring and set to retire in coming years, the report predicts. This is one year sooner than a similar trustees report projected last year.

The Congressional Budget Office recently said that Social Security could only collect $3 billion more in 2010 than it pays out in benefits. Just last year, the CBO had predicted a substantially higher cash surplus of $86 billion for 2010. This hit to Social Security receipts is expected to continue, and will require Social Security to tap into its trust fund as of 2016 in order to make up the difference between the taxes coming in and the benefits being paid out.

The problem, though, is the nature of the trust fund, which consists entirely of Social Security bonds. These bonds exist only as bookkeeping entries—IOUs—because the money they represent has already been spent on other government operations. Therefore, in order to tap into the trust fund, the government will have to increase borrowing or raise taxes.

The trust fund, according to Tuesday’s report, is expected to be depleted by 2037, four years earlier than previously predicted.  But “depleted” does not mean that future retirees would receive nothing after 2037. Once the fund is depleted, Social Security benefits will be limited to the amount workers pay into the fund that year. The report expects benefits to continue at about 75% of their promised level, three percentage points less than predicted last year.

Medicare’s problems loom even larger. Hit hard with rising healthcare costs and an increased demand for public health programs, expenses are expected to exceed tax revenue for Medicare’s hospital insurance fund in 2017, two years sooner than estimated in a similar report in 2008. Medicare’s expenses could surpass Social Security’s by 2028.