/Covid Baby Bust Has Governments Rattled

Covid Baby Bust Has Governments Rattled

Not surprisingly, many young people have put off having children as a result of the Covid pandemic, and some even say they’ve decided not to have kids or to have fewer. Fear of going to see the doctor (you can’t do all that OB/GYN stuff during pregnancy via Zoom) and worries about finances will do that.

As some will no doubt point out, governments could have done a lot more to support incomes, so the child drought didn’t have to be as bad as it’s shaping up to be. And the drop in births isn’t limited to countries that are having trouble getting the disease tamed. China, which after its initial catastrophic outbreak has done an exemplary job of containing Covid, is also suffering a baby bust.

Of course, there’s a case to be made that fewer people in advanced economies is a good thing. But arrayed against that are all the “because groaf” forces. The two drivers of growth are demographic growth, as in more people, and productivity increases. National leaders are afraid of becoming the new Japan, having an aging population and falling in the “size of economy” pecking order, when Japan has weathered a financial system crisis and implosion of real estate prices with remarkable grace. And the demographic time bomb? The feared dependency ratio? More older Japanese work. Japanese even more so than Westerners prize attachment to communities and organizations, so it would probably suit those who are able to handle it to remain in the saddle or get a part-time job.

But the big point is that the Covid impact on child-bearing is widespread and looks set to continue for quite a while. The old solution in advanced economies for low birth rates was immigration. But that’s now become fraught. First is that neoliberalism-induced widening income disparity means those on the bottom are extremely insecure. Bringing more people in to them sure looks like a mechanism for keeping their crappy wages down. Second is advanced economies now eschew assimilation as if it were racist. But what did you expect, say, when Germany brought in Syrian refugees, who skewed male and young, and didn’t even arrange to teach them German? The notion that there’s a public sphere, where citizens hew to national norms versus a private sphere seems to have been lost (having said that, I don’t understand the fuss about headscarves; Grace Kelly wore them, so why should a religious intent matter?).

Now to the data. The countries worst afflicted include Italy, which was already suffering from a population contraction before a bad case of Covid. From the Wall Street Journal:

A year into the pandemic, early data and surveys point to a baby bust in many advanced economies from the U.S. to Europe to East Asia, often on top of existing downward trends in births.

A combination of health and economic crises is prompting many people to delay or abandon plans to have children. Demographers warn the dip is unlikely to be temporary, especially if the pandemic and its economic consequences drag on.

“All evidence points to a sharp decline in fertility rates and in the number of births across highly developed countries,” said Tomas Sobotka, a researcher at the Wittgenstein Center for Demography and Global Human Capital in Vienna. …

A survey carried out by Italian research group Osservatorio Giovani between late March and early April in Western Europe’s five largest countries—Germany, France, Italy, Spain and the U.K.—found that over two-thirds of respondents who initially planned to have a child in 2020 decided to postpone or abandon plans to conceive over the next year.

In the U.S., a survey by the Guttmacher Institute, a research organization, found that one-third of women polled in late April and early May wanted to delay childbearing or have fewer children because of the pandemic.

The Brookings Institution estimated in December that, as a result of the pandemic, 300,000 fewer babies would be born in the U.S. in 2021 compared with last year. That estimate is based on survey evidence and the historical experience that a one-percentage-point increase in the unemployment rate reduces the birthrate by roughly 1%….

Historically, traumatic events such as pandemics, wars and economic crises have often resulted in fewer births. Some baby busts are short-lived and followed by rebounds. But the longer a crisis lasts, the higher the chances that potential births aren’t just postponed but never happen, say demographers.

No rebound followed the global financial crisis, for instance. The U.S. birthrate—after rising to its highest level in decades in 2007—plunged after the 2008 crisis and has declined gradually ever since.

The BBC also reported on the US birth decline, and explained that couples spending more time at home didn’t necessarily lead to more rutting:

Amid extensive school and day care closures, as well as limits on public gatherings, millions of women have been forced to balance supervising and teaching their children with work and other responsibilities.

Surveys revealed that many couples are delaying pregnancies, having sex less often and want fewer children because of the pandemic and its economic costs, according to the Guttmacher Institute.

“When the labour market is weak, aggregate birth rates decline; when the labour market improves, birth rates improve,” wrote the authors of the Brookings Institute study, Melissa Kearney and Philip Levine.

And online searches for pregnancy-related terms were down last year, according to Google Trends data.

In comments at the Journal, one urologist in the US said that in his practice, vasectomies were way up.

As the Journal explains, Italy continues to be the sick man of Europe:

The worst-affected country so far appears to be Italy. The country has one of the world’s oldest populations and has struggled with declining birthrates for years, partly the consequence of a sclerotic economy that left young people behind. Then came Covid-19, which hit Italy early and hard.

Births in Italy plunged 21.6% in December from the previous year, according to first estimates by Italy’s statistical agency based on data from 15 major cities. That is a far bigger drop than during the first 10 months of 2020, when births declined 3.3% on average. Overall in 2020, nearly twice as many people died in Italy than were born there.

China is not in such hot shape:

The world’s most populous country was already on a path of declining births due to the lingering effects of its one-child policy, abolished in late 2015 after three decades.

Chinese couples can now have two children, but many who were undecided about having a first or second child postponed their plans in 2020. Surveys have found concerns ranging from uncertain incomes to fear of contracting the virus during maternity checkups…

China has yet to release nationwide 2020 population data but several local governments have reported double-digit-percentage declines in the number of births from 2019.

The conventional view is that capitalism depends on growth, and hence a contracting population is a big headwind. I’m not sure that view is correct. Finance-driven capitalism may be but that model isn’t working so well as it is. Capitalism is going to have to adapt to resource constraints and static or shrinking populations. If we had leaders as opposed to narcissists and looters in charge, it might be possible to manage a transition. We’re more likely to get rolling crises.

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