May 11th, 2016 4:30 am
Via the WSJ:
By Janet Adamy
May 10, 2016 11:30 a.m. ET
201 COMMENTS
The U.S. is experiencing a baby lull that looks set to last for years, a shift demographers say will likely ripple through the U.S. economy and have an impact on everything from maternity wards to federal social programs.
U.S. births have edged up modestly since 2013, a trend likely to continue when last year’s official federal figures are scheduled to come out in June. That has stemmed a sharp drop in child bearing that started with the onset of the recession in 2007.
But behind that sliver of good news are more-worrisome signs that the U.S. may not soon return to its pre-recession average of about two babies for every adult woman. Some demographers have pared their forecasts for future births because an expected post-recession baby boom has been smaller than anticipated.
The leveling-off in births is weighing on sales at children’s stores, prompting hospitals to rework their birth wards and putting pressure on builders of single-family homes, executives and economists say.
“We’re just in a new era nationally and even globally where people are having fewer children,” said Jennifer Olson, vice president of strategy and business development at Children’s Hospitals and Clinics of Minnesota. “It’s really reshaping our focus.”
Demographic Intelligence, a Charlottesville, Va., firm that forecasts birth trends, projects there were about 4 million babies born in the U.S. in 2015, up slightly from the 3.99 million babies born the previous year. The total fertility rate—a snapshot that measures the number of births the average woman will have during her lifetime—is expected to rise to 1.87 in 2015 from 1.86 the previous year, according to the firm. It says its projections, which rely on unemployment rates, consumer-confidence measures and other variables, have been about 99% accurate in recent years.
That is well below the relatively strong fertility rates that started during the late 1980s and lasted until 2007, when the total fertility rate peaked at 2.12 babies per woman. The lower rates since then translate to about 3.4 million fewer births between 2008 and 2015, according to Kenneth Johnson, a demographer at the University of New Hampshire.
“Everything is slower than we expected,” said Sam Sturgeon, president of Demographic Intelligence. His firm recently called an end to the quarter-century era when Americans experienced exceptionally high fertility rates for a developed nation, and he predicts that the total fertility rate won’t go above 1.9 babies per woman for the next five years or longer.
An ideal birth rate is around 2.1 babies per woman, demographers say, since that’s the rate that’s needed to replace the current levels of population. America remains in far better shape than most of Europe and parts of Asia, where the total fertility rate dips as low as 1.44 in Germany and 1.49 in Italy, said Mark Mather, a demographer at the Population Reference Bureau, a nonprofit research organization in Washington.
A swirl of social and economic factors is damping births in the U.S. Millennial women are delaying marriage as well as childbearing. A flow of Latino immigrants who helped lift the U.S. birth rate has tapered off. Women are now outpacing men in earning college degrees, a milestone that weighs on birth rates as it heightens the cost of women pulling back from their careers to have children. And young adults are less attached to organized religion than older generations were at their age, research shows, which is thinning the ranks of a group that tends to have more babies.
There’s also evidence that being a young woman in a weak job market forever reduces the chances of having children. A 2014 study by economists Janet Currie and Hannes Schwandt of Princeton University found that for women age 20 to 24, a one percentage-point increase in the average unemployment rate reduced their fertility in the short term by 6 conceptions per 1,000 women. By the time those women reached age 40, that early rise in the unemployment rate had led to an overall loss of 14.2 conceptions per 1,000 women. Most of that came from women who ended up not having any children at all.
“A part of that is the biological clock, but part of it is if you’ve reached a certain lifestyle by the time you’re 35, having a child may be more disruptive than it was if you were 25,” said Nan Marie Astone, a senior fellow at the Urban Institute.
Catherine Brozena, a 42-year-old communications professional in Oakland, Calif., says she and her husband are opting against having children because “raising kids in this day and age is such a huge commitment financially [and] socially.” Her husband recently started a metal fabrication and design business, and she wants to save time for pursuits like making music, biking and running. “It’s hard enough to keep myself afloat.”
A broader divide is emerging among who is having children in the U.S. Births are rising among women who are older, educated, married and more prosperous. They’re declining for high-school dropouts and dipping particularly sharply among teenage girls. The mean age of women giving birth in 2014 was 28.3 years old, just under a year older than a decade before, according to the Centers for Disease Control and Prevention.
Some demographers are still optimistic that births could see a more meaningful pickup soon, especially if the economy takes off. The biggest cohort of millennials is moving into their prime child-bearing years of their mid-to-late 20s. Labor-force participation among young adults has turned upward, and Hispanic birth rates are also starting to climb. Births have rebounded close to their pre-downturn levels after many other recessions, including the slowdown of the mid-1970s.
At Children’s Hospitals and Clinics of Minnesota, which has hospitals in Minneapolis and St. Paul, executives have seen an uptick in neonatal admissions since 2011 as the age of women having babies has crept up after the recession, said Ms. Olson, the vice president of strategy. The health system is reworking its maternity wards so that neonatal units are closer to where women have babies, a move that’s in part a response to the fact that more women age 35 and over are giving birth at its facilities.
Sales of single-family homes are being weighed down by what Robert Dietz, chief economist at the National Association of Home Builders, calls “the great delay,” the trend of millennials postponing milestones like marriage and having kids. Other ripple effects take years to show up, such as the drag of having fewer young workers paying into Social Security and Medicare, said Mr. Mather of the Population Reference Bureau.
At Babies “R” Us, part of the Toys “R” Us national chain of children’s stores, “the assumption that we’ll make is that the market is not going to grow” as a result of near-term changes in the fertility rate, said Reg McLay, senior vice president at Babies “R” Us.
The company is instead planning to increase sales by gaining market share from competitors and finding “unmet needs” among millennial parents, he said. That includes creating more-distinct products, such as a $299 Evenflo car seat that’s specially tested to protect children during rollover accidents. The chain is testing adding a section to its stores where parents can create baby registries and take lactation classes, and introducing a gear test track that allows parents to experiment with strollers on artificial grass and wood.
Write to Janet Adamy at [email protected]
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