Collapsing fertility rates
and troubling policy implications

di Priscilla Pajdo del March 19, 2021

TORONTO - For decades, global fertility rates have been on the decline. Seventy years ago, women of child-bearing age had an average five children. Since then, the number has dropped by half to approximately 2.4 children per woman.

The consequences of declining fertility rates are as numerous as they are diverse. Periods of sustained low fertility can impact population growth and the size of the labour force. Additionally, it can have wider implications for social, economic and national security.

Several reasons may explain the significant downward trend: the modernization of societies, declining child mortality, increasing costs of raising children, changing religious values, birth control measures and the empowerment of women, to name a few.

For instance, improving access to education and growing female participation in the labour market factor into waning birth rates. By reducing the number of children or delaying childbirth, individuals could conceivably further their education and start a career before growing the family.

This approach to planning has its benefits. It could work in favour of a more skilled and specialized labour force and allow individuals access to better paying jobs and higher disposable income. More money means more spending, driving demand and stimulating job growth.

However, as fertility rates continue to drop, countries will face challenges in sustaining current population levels. Signs are beginning to show a drop in population growth rates. According to Our World in Data, the steady downward trend in growth rate is evident from a peak of 2.1% in 1968 down to a growth rate of 1.05% in 2020.

To maintain a country’s population, the birth rate should be at a rate of 2.1 births per woman of child-bearing age. However, several well-developed nations fall below that figure. For instance, in 2020, Canada’s rate measured 1.5 children per woman. It had been 3.9 in 1960 - a drop of nearly 60%. A similar phenomenon is playing out across Europe. In Italy for example, the birth rate fell by half over the course of those sixty years. In the mid-60s, Italian women gave birth to an average of 2.5 children. In 2020, that number was 1.3 per woman.

Some demographers speculated that the pandemic might prompt a baby boom. During months of lockdown, how do couples pass the time, they speculated? This theory of mass procreation has proven to be just that, so far.

According to data by the Italian National Institute of Statistics (ISTAT), in 2020, the country recorded about 400,000 births, down from 420,000 in 2019. Preliminary data from some 15 Italian cities suggests a drop in births of 21.6% compared to one year ago. Taken together, this could point to a probable decline in births for 2021.

Falling birth rates have wider implications. The imbalance in the ratio of elderly dependents to people of employment age is yet another issue policy makers will have to address.

As a larger group of aging adults exit the workforce, where are the bodies to take their place or to contribute tax dollars for their pension entitlements?

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