THE BLOG
09/10/2010 10:09 am ET | Updated Nov 17, 2011

Baby Boom Has Gone Bust

One unexpected side effect of economic hard times is a sharp decline in birth rates. In Illinois, for example, the birth rate has fallen to its lowest level since 1933, the darkest days of the Great Depression. "Many couples are strained and don't want to take on additional responsibilities," said Dr. Kishore Lakhani, an obstetrics and gynecology specialist. Approximately 50 percent of low- and middle-income women questioned last year by the Guttmacher Institute said they planned to defer pregnancy or limit the number of children they have because of money concerns.

Illinois is not alone in seeing its birth rate plummet. On a national basis, the birth rate has fallen to its lowest level in at least a century as many people have apparently decided they can't afford to have children. It's the second consecutive year, the birth rate's fallen since the recession began in 2007. Births fell 2.6 percent in 2009 even as the population grew, according to the National Center for Health Statistics. "It's a good-sized decline for one year. Every month is showing a decline from the year before," said Stephanie Ventura, the demographer who oversaw the report.

The national birth rate is now 13.5 births for every 1,000 people in 2009 (compare that to 30 per 1,000 in 1909). The situation is a remarkable change from 2007, when more babies were born in the United States than any other year in the nation's history. When the birth rate fell to below 20 per 1,000 people in 1932, it did not recover until the early 1940s. Recent recessions, in 1981-82, 1990-91 and 2001, all were followed by small dips in the birth rate, according to Centers for Disease Control and Prevention statistics.

So what does a low birth rate mean in economic terms? Japan and its 10 years of economic decline in the 1990s may be the best indication of this. The estimates of Japan's National Institute of Population and Social Security Research claim that the country's labor force peaked at 66,970,000 people in 2005 and then will decrease to 62.6 million by 2025. This annual decrease in the population of about 0.5 percent will push the economic growth rate down by 0.3 percentage points. Japan's 2009 birth rate was 7.64 births per 1,000 population. The situation varies across the rest of the G-7: United Kingdom saw its biggest population increase in nearly 50 years in 2009; France's birth rate also has been rising; Germany's birth rate, on the other hand, is currently 7.88 per 1,000. That's down 16 percent over the last decade and the lowest in the country's history.

As the baby rate dwindles, what keeps our population numbers buoyant is, of course, immigration (something to keep in mind as we navigate the border issue once again). According to the Census Bureau figures, more than two-thirds of current and future population growth is the result of immigration. The current population of 310 million could increase to 399 million, 423 million or even 458 million by 2050 (these increasing labor inputs, some economists believe, adds a point to annual GDP growth), depending on immigration trends and, by extension, immigration laws, over the next 40 years. "Our birth rate is still higher than in many wealthy countries and we also have many immigrants entering the country. So we do not need to be worried yet about a birth dearth" that would hamper the nation's ability to take care of its increasing elderly population, said Andrew Cherlin, a professor at Johns Hopkins University.

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