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The Social Security number (SSN) was created in 1936 for the sole purpose of tracking the earnings histories of U.S. workers, for use in determining Social Security benefit entitlement and computing benefit levels. Since then, use of the SSN has expanded substantially. Today the SSN may be the most commonly used numbering system in the United States. As of December 2008, the Social Security Administration (SSA) had issued over 450 million original SSNs, and nearly every legal resident of the United States had one. The SSN's very universality has led to its adoption throughout government and the private sector as a chief means of identifying and gathering information about an individual.

On December 17, 1935, the Board approved the 9-digit option (McKinley and Frase 1970, 323). The Board planned to use the year one attained age 65 as part of the SSN, thinking that once an individual attained age 65, the SSN would be reassigned to someone else. But at a meeting on January 23, 1936, the unemployment compensation delegates objected to the use of digits to signify age because they thought a number of workers would falsify their age. As a result, a new scheme adopted by the Board on February 14 consisted of a 3-digit area code, a 2-digit month of birth, and a 4-digit serial number.

The 3-digit area number is assigned by geographic region. In 1936 the Social Security Board planned eventually to use area numbers to redistribute work to its 12 regional centers to serve workers in those areas. One or more area numbers were allocated to each state based on the anticipated number of SSN issuances in the state.3 Prior to 1972, the numbers were issued to local offices for assignment to individuals; it was thought this would capture information about the worker's residence. So, until 1972, the area number represented the state in which the card was issued. (Barron and Bamberger 1982, 29).

Generally, area numbers were assigned in ascending order beginning in the northeast and then moving westward. For the most part, people on the east coast have the lowest area numbers and those on the west coast have the highest area numbers. However, area numbers did not always reflect the worker's residence. During the initial registration in 1936 and 1937, businesses with branches throughout the country had employees return their SS-5 Application for Account Number to their national headquarters, so these SSNs carried the area number where the headquarters were located. As a result, the area numbers assigned to big cities, such as New York, Philadelphia, Boston, and Chicago, were used for workers in many other parts of the country (McKinley and Frase 1970, 373). Also, a worker could apply in person for a card in any Social Security office, and the area number would reflect that office's location, regardless of the worker's residence.

Since 1972, when SSA began assigning SSNs and issuing cards centrally from Baltimore, MD, the area number has been assigned based on the ZIP code of the mailing address provided on the application for the original Social Security card. The applicant's mailing address may not be the same as the place of residence.

SSA has many years' worth of potential SSNs available for future assignment. However, because of population shifts, SSA now faces an imbalance in the geographic allocation of area numbers. Some states have a current allocation of SSNs that will last for many years, while others have a pending shortage. As a result, given present rates of assignment and existing geographic allocations, several states currently have fewer than 10 years' worth of SSNs available for assignment.

In a July 3, 2007, Federal Register notice, SSA solicited public comment on a proposal to change the way SSNs are assigned (SSA 2007b). Under this proposal, SSA would randomly assign SSNs from the remaining pool of available numbers, and the first three digits would no longer have any geographic significance. SSA contends that doing so would ensure a reliable supply of SSNs for years to come, and would also reduce opportunities for identity theft and SSN fraud and misuse. SSA plans additional discussion with other government entities and the private sector before implementing any change. 2b1af7f3a8