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To Grow GDP, We Need More Babies

February 24, 2020

I’ve written about this before, but it’s still worth noting – the U.S. birth rate has fallen again, according to the Centers for Disease Control (CDC).

Forget Mayan proclamations and other doomsday scenarios, the world’s population is still growing. However, birth rates in most developed countries are falling.

Average women of child-bearing age (15-44) are having fewer children. The latest data ending in 2018 show a fourth consecutive decline, and further declines are expected in 2019 for birth and fertility rates.

The birth rate, which is the actual number of live babies born to U.S. women each year, was just shy of 3.8 million in 2018. The fertility rate is the number of births per 1,000 women of child-bearing age. It was 1,729 in 2018, which is the lowest number in 32 years, per the CDC.

For our population to remain stable, the rate needs to be 2,100 children per year, which is 371 more per year than the current rate. And the prospects don’t look good for more kids soon.

One reason is a significant increase in the median marriage age. For women, the average age of marriage has risen to 28 years old, up from 21 in 1970. The average man gets married at age 30 now, as opposed to 23 in 1970. Naturally, people who marry later in life will have kids later in life too.

If this continues, and most think it will, there are troubles ahead for the economy, the workforce, and our lives in general. As workers retire, fewer younger ones are replacing them. Plus, older consumers tend to buy less. Economic growth is generally driven by population growth and worker efficiency. Both have slowed in the past decade.

The answer? More babies.

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