In terms of things to worry about, the U.S. economy already has its share of concerns. Well, add one more to that list: not enough babies.
The U.S. fertility rate is at an all-time low and doesn’t show signs of rebounding any time soon. In fact, women have never had so few children in the history of the U.S. The tipping point is contained within the term “replacement level fertility” — demographer-speak for the number necessary to replace you and your partner. That would be two babies.
And for the longest time that rate was sitting comfortably at about 2.1.
“That’s kind of the magic number, and over the past several years we’ve actually dipped below that 2.1. We’re now at around 1.9 births per woman,” says Mark Mather, a demographer at the Population Reference Bureau.
Many young people might still be feeling the pinch of the Great Recession and have just stopped having children, Mather says.
Another factor holding down birth rates could be the simple fact that many more women are primary bread-winners, and are unwilling to pay the opportunity cost of dropping out to have children. “As more and more women are entering the workforce, we’d expect fertility rates to stay at pretty low levels, and I don’t see any signs of that slowing down in the future,” Mather says.
An aging work force, a drop-off in consumer spending that spans from Onesies to college tuition — these just a few negative economic impacts of the baby bust.
But how much should we really worry?
“I don’t think it’s an economic disaster, but it does create challenges,” says David Lam, an Economist at the University of Michigan Population Studies Center. The theory, says Lam, is that as economic conditions improve, people will start having more babies. But even if we don’t, many other wealthy economies are doing just fine.
“You know, Germany is doing quite well right now economically, relatively speaking, with a lower fertility rate than we have,” he says.
And if economic incentives to get in a family don’t come about, immigration is a button policymakers might consider pushing to help drive the recovery.