American Baby Bust

Bloomberg Businessweek August 3, 2020 pp26-29 Economics | “The Coming Baby Deficit”. “The Covid-19 crisis may leave a lasting imprint on U.S. fertility trends, taking a toll on growth”

With the exception of the intervening years 2010-2016, America has experienced a steady decline in annual births from nearly 4.3M in 2007 to 3.7M in 2019. Post 2007-2009 saw a leveling off from 2010 to 2016 at 4M but not a rebound. Experts predict another decline of 300,000-500,000 births following Covid-19. These estimates are based on delayed weddings, an uptick in contraceptives especially the of long-lasting variety, more requests for abortions and opinion polls indicating a desire to slow family planning due to Covid-19.

Chart from Pew Research and not in the BBW report.

With depressing times, rising costs to raise children, and an uncertain health and economic future, holding off on expanding or starting a family is logical and follows the pattern observed after other economic slowdowns. Paradoxically lockdowns, with much together time, don’t result in more births. Making the prospects of a rebound less likely are birth rates by maternal age. Birth rates in young women, 15-19 and 25-29, were already trending down and while birth rates were trending up for older women, 30-34 YO and 35-39 YO, a pause with the biological clock-ticking could reduce their likelihood of ever conceiving. So far fertility physicians don’t see a lack of ambition in this group.

Leading up to 2020 the actual accomplished rate births in a reproductive lifetime, which is calculated at age 49, was higher than a few years earlier at 2.1-a zero-population growth rate or replacement birth rate is 2.1. Prior to the pandemic the America rate was below 1.7 and just slightly higher than the EU at 1.5. Prior records support that delayed births are not made up. “It’s worth noting that countries including Hungary, Poland, and more recently Russia have had little success in reversing declining fertility rates with subsidies.”

To economists and government planners fewer births means less current and future economic activity. “Every two-tenths decline in total fertility rate…necessitates an increase in Social Security payroll tax of about 0.4 percentage points” according to the “2020 annual report of the trustees of the Social Security trust funds.”

On a positive note, having one fewer child in wealthy nations is more beneficial to the environment than reducing air-travel or buying an electric car.