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Trend

Declining Birthrates

Remember when having 2.5 kids was the American dream? A house in the suburbs, a white picket fence, and a gaggle of little ones running around the yard? Well, those days are long gone.

Birthrates have been steadily declining for decades, but recently, they've taken a nosedive off the fertility cliff.

The implications are far-reaching. Here are some stats to paint the picture:

• Over the past 50 years, global fertility has been halved. The decline is especially pronounced in high-income economies, where the population in already shrinking or on track to shrink soon.

• In 2019, eighty-one countries had fertility rates below the population replacement threshold. The replacement fertility rate, estimated at 2.1 births per woman, represents the level required to sustain a stable population over the long run, assuming mortality and migration remain constant.

• The UN projects that by 2100, 97% of countries will have fertility rates below the 2.1 babies per woman needed to sustain population levels.

• Italy is a leader in the global depopulation race—by 2050, 6 million fewer Italians will be enjoying that magnificent weather. Japan, another rich, tightly knit society, may lose 20 million inhabitants by 2050—that’s 45 times the lives lost in Hiroshima and Nagasaki, wiped out in one generation.

• The consequences of falling fertility rates include economic challenges due to shrinking labor forces, strained government finances and pressure on pension systems; weakened social capital and community participation as adults have fewer and smaller families and demographic shifts putting pressure on healthcare systems.

Why is it happening?

• Rising female education and employment

• Women’s delayed entry into the labour market

• High monetary and time cost of raising kids

• Rising real estate prices and healthcare costs

Further, a study from the Pew Research Center found that fertility is falling across education levels, with the declines most pronounced among the most educated and least educated women.

This makes sense: those less educated often delay childbearing due to financial insecurity, while highly educated women are more likely to have a demanding workplace culture, making childbearing less feasible if they want to continue progressing in their careers.

Countries have tried several policies to raise fertility rates, with only marginal success: South Korea introduced one-time cash bonuses for new parents, while Taiwan introduced parental leave and free early childhood education. Neither of these reversed the trendlines.

Addressing declining fertility requires more creative thought. The data on falling fertility across education levels suggests that preserving women’s economic gains and workforce participation while making it more affordable for less educated women to start families are viable pathways to improvement.

To that end, solutions that address these core problems are likely to hold the most promise. These are among the most interesting:

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