At the Peak of the Baby Boom, How Many Children, on Average, Did U.s. Woman Have?

The COVID-19 episode will likely atomic number 82 to a large, lasting babe bosom. The pandemic has thrust the country into an economic recession. Economic reasoning and by bear witness advise that this volition pb people to have fewer children. The decline in births could be on the order of 300,000 to 500,000 fewer births next year. We base this expectation on lessons fatigued from economic studies of fertility behavior, forth with information presented here from the Great Recession of 2007-2009 and the 1918 Spanish Influenza.

When the public wellness crisis first took hold, some people playfully speculated that at that place would exist a spike in births in nine months, as people were "stuck home" with their romantic partners. Such speculation is based on persistent myths about birth spikes occurring nine months after blizzards or major electricity blackouts. Equally it turns out, those stories tend not to hold upward to statistical examination (Udry, 1970). Simply the COVID-19 crunch is amounting to much more than a temporary stay-at-habitation order. Information technology is leading to tremendous economical loss, uncertainty, and insecurity. That is why nascence rates will tumble.

Every bit economists, nosotros focus on the underlying decisions that drive behaviors and ultimately outcomes, including having children. Our approach to modeling fertility is different than scholars from the medical or reproductive health community, who tend to focus on the mechanical drivers of pregnancy and giving birth, like access to birth command or abortion. These are important, of form, and we have focused on them in our own previous research (Kearney and Levine, 2009, Levine, et al., 1999, and Levine, 2004). But it is important to recognize the critical role that economical weather play in fertility choices.

Economics matters for birth rates

As whatsoever parent will tell you, children come up at a cost. They crave outlays of money, time, and energy. Certainly, they are also a source of joy and love. In the analytical terms of economic modeling, adults "choose" the quantity of children that maximizes their lifetime well-beingness discipline to the costs associated with childbearing. Such a framework predicts, all else equal, that a college level of lifetime income leads people to have more children. Biological constraints may prevent some people from achieving their target number of births, or optimal timing. But there is considerable empirical support for the prediction that an increase in income leads to more than births, what economists phone call "a positive income effect."

Black, Kolesnikova, Sanders, and Taylor (2013) find that marital births in coal-producing areas tracked earnings changes associated with the coal smash and bosom during the 1970s and 1980s. Kearney and Wilson (2018) notice that the higher incomes that came about from fracking led to increases in both marital and non-marital births in affected counties. Autor, Dorn, and Hanson (2019) show that places that experienced a reduction in employment and earnings – resulting from increased import contest from China – consequently had lower nativity rates. Increases in housing wealth likewise lead to increases in fertility; Dettling and Kearney (2014) and Lovenheim and Mumford (2013) show that increases in house prices lead to increases in births among existing home owners, consistent with a positive wealth or dwelling equity result, while Dettling and Kearney (2014) further show that increases in house prices lead to reductions in births amid renters, consistent with a negative price effect.

Blast and bosom – and babies

Apart from the question of how many children to have, parents also confront the decision of when to have them. If credit markets are perfect, parents tin infringe and salve in order to finance the cost of children and optimally choose when to take children. Merely it is difficult for people who are credit constrained to cull to have a kid when their income is low. If coin matters for fertility, we would therefore expect to run into births movement with the business cycle.

There is ample evidence that birth rates are, in fact, pro-cyclical. This is shown, for case, in the work by Dettling and Kearney (2014) described in a higher place. Their analysis of birth rates in metropolitan areas finds that all else equal, a one percent-bespeak increase in the unemployment rate is associated with a i.iv percent decrease in nascence rates. Schaller (2016) analyzes the relationship between state-level unemployment rates and nativity rates, and finds that a one percentage-betoken increment in country-year unemployment rates is associated with a 0.ix to 2.2 percent subtract in nativity rates. Other evidence shows that women whose husbands lose their jobs at some point during their wedlock ultimately have fewer children (Lindo, 2010). This suggests that transitory changes in economic conditions lead to changes in birth rates.

If people are simply timing their fertility with the business cycle, then the years after an economic downturn will see a relative increase in birth rates, such that women's full completed fertility might largely be unchanged. All the same, to the extent that delayed fertility results in lower total fertility for some women, so the observed reductions in current menses births will reverberate reductions in the total number of births. Furthermore, if shocks to economic weather bear witness to be persistent, and then changes in birth rates will be equally well. A deeper and longer lasting recession will so mean lower lifetime income for some people, which ways that some women will not simply delay births, just they will decide to have fewer children.

Recessions mean fewer children

The COVID-19 public health crisis has badly damaged the economy, and the recession is probable to concluding for many months. The Federal Reserve forecasts that the unemployment rate will still be at nine.3 percent by the end of the year. Barrero, Bloom, and Davis (2020) predict that 42 percent of recent layoffs will exist permanent. Though many of these workers will somewhen detect new employment, inquiry has shown that recession-related chore loss leads to persistent, big negative effects on lifetime earnings (Davis and von Wachter, 2017).

An analysis of the Neat Recession leads u.s. to predict that women will have many fewer babies in the curt term, and for some of them, a lower full number of children over their lifetimes. This is consistent with the evidence described above. The Great Recession led to a large reject in birth rates, subsequently a period of relative stability.  In 2007, the birth rate was 69.one births per 1,000 women ages 15 to 44; in 2012, the rate was 63.0 births per 1,000 women. That nine percent driblet meant roughly 400,000 fewer births.

Land-level comparisons provide a more direct link between an economic downswing and birth rates. States in which the recession was more severe experienced greater declines in birth rates, according to our analysis of Vital Statistics nascency data from the National Center for Health Statistics, population data from the U.Due south. Bureau of the Demography, and state unemployment rates from the Bureau of Labor Statistics from 2003 to 2018. States in which the recession was nigh severe experienced larger drops in births. In this simple analysis, nosotros find that a one pct point increment in unemployment reduces the birth rate by 1.4 percent. (That is an unweighted estimate; weighting the observations yields an estimated affect of -1.ii pct).

Over a longer time period, from 2003 and 2018, we find that that a one percent indicate increment in the land unemployment rate led to a 0.9 percent reduction in the birth rate. This estimate comes from a more formal econometric assay, using a regression model estimating the natural log of the nativity rate every bit a function of the unemployment rate in the preceding year, decision-making for country and year fixed effects. A more detailed report could include other potentially relevant factors, such as expanded access to long-acting reversible contraceptives (LARCS), better access to health insurance, and others. We expect however that including these factors would yield a larger approximate, since our estimated issue is on the lower stop of those institute in the more detailed econometric studies described above.

The Spanish Flu and Births

We have emphasized the role of weaker economic conditions in driving a future decline in births, but we hasten to acknowledge the public wellness attribute. The 1918 Castilian Flu provides an obvious comparison; and it generated a large decline in births.

Here we show the monthly trend in the death rate due to flu and pneumonia (the principal causes of death attributed to Spanish Influenza), forth with the aggregate nascence charge per unit (births per 1,000 population) for those states reporting Vital Statistics data at that fourth dimension (21 states participated in 1918). Birth rates are backdated by nine months to approximate the calendar month of conception:

Big spikes in mortality were matched by big declines in births. Determining causation is always difficult, but the precision with which the spikes match strongly suggest this was a causal impact. As a rough approximation, the steady state monthly nascence rate during this menstruation was 24 births per one,000 population. Each spike in the Castilian Flu epidemic led the birth charge per unit to fall roughly 21 births per 1,000 population. This represents a 12.5 percent turn down. Note that when the expiry charge per unit dropped once again, birth rates returned to normal levels, but did not "overshoot," implying fewer births overall.

In drawing lessons from the Spanish Influenza for the COVID-nineteen pandemic, nosotros note both similarities and differences. The drop in births that resulted from the Spanish flu was probable due to the uncertainty and anxiety that a public wellness crisis can generate, which could affect people's desire to give nativity, and too biologically affect pregnancy and nativity outcomes. That could be truthful during this crisis as well. But, different what nosotros're experiencing today, the economy contracted merely modestly at the time of the Spanish Influenza considering the ongoing state of war effort supported manufacturing  (Benmelech and Frydman, 2020). This suggests COVID-19 could accept a bigger bear on, since the public health crisis has hit the economy, too.  Furthermore, women today have access to much more than constructive forms of contraception. On the other hand, a much larger share of the Spanish Flu deaths was concentrated on those in their childbearing years (Simonsen, et al., 1998).

Birth rates are impacted by high-mortality events more generally, as  Lyman Stone points out. He underlines the established fact that "high-mortality events as various as famines, earthquakes, heatwaves, and disease all take very anticipated furnishings on reducing births ix months later." Stone shows estimates from "expiry spike" events including Hurricane Maria, Hurricane Katrina, and the 2015 Ebola outbreaks in Liberia, Sierra Leone, and Guinea. Although this is consequent with our hypothesis, the central mechanisms are different. Stone'southward hypothesis focuses on the mechanical relationship between bloodshed and illness amid people of childbearing age and subsequent fertility. COVID-19 is not having a large impact on the mortality of people of childbearing historic period. Only one% of COVID-19 deaths reported so far in the U.S. are among the nether-35s. But the current crunch is too i that we will endure for quite some time, unlike the one-fourth dimension, discrete occurrences that characterize these other loftier mortality events.

How large volition the Covid-19 babe bust exist?

What are the likely implications of the COVID-19 episode for fertility?  The monthly unemployment charge per unit jumped from 3.5 percent to xiv.7 per centum in April and to 13.3 percent in May. Annotation that the BLS also bespeak that technical issues in collecting these data likely hateful that the actual unemployment rates in those months were likely five and 3 percentage points higher, respectively. That would bring them to about xix.seven and 16.iii percent. Although information technology is difficult to forecast the 2020 annual unemployment rate, assuming a 7 to 10 percentage-point spring to 10.vi to 13.half-dozen percent seems reasonable. Based on the findings presented higher up, this economic shock alone implies a 7 to 10 per centum driblet in births next year. With 3.8 million births occurring in 2019, that would corporeality to a pass up of between 266,000 and 380,000 births in 2021.

On elevation of the economical impact, there volition likely exist a further turn down in births every bit a straight result of the public health crunch and the uncertainty and feet information technology creates, and perhaps to some extent, social distancing. Our assay of the Spanish Influenza indicated a 15 per centum turn down in almanac births in a pandemic that was non accompanied by a major recession. And this occurred during a period in which no modernistic contraception existed to hands regulated fertility.

Combining these two effects, we could run into a drop of perhaps 300,000 to 500,000 births in the U.S. Additional reductions in births may exist seen if the labor market remains weak beyond 2020. The circumstances in which we at present discover ourselves are likely to be long-lasting and will lead to a permanent loss of income for many people. We wait that many of these births volition not but be delayed – but will never happen. There will be a COVID-19 baby bust. That volition be yet some other cost of this terrible episode.

Acknowledgements: The authors thank Taylor Landon for excellent inquiry aid.

The authors did non receive financial support from whatsoever firm or person for this article or from any firm or person with a financial or political interest in this commodity. They are currently not an officer, director, or board fellow member of any system with an interest in this article.

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Source: https://www.brookings.edu/research/half-a-million-fewer-children-the-coming-covid-baby-bust/

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