Europe not only has a debt problem that keeps many of its member countries teetering on the brink of full-fledged depression, it also suffers from a lack of babies.
Yes, babies. The fertility rates in 11 of the 15 countries that have reported their statistics for 2011 have fallen.
The replacement fertility rate is 2.1. This means that the women in a nation must average 2.1 births during their lifetimes in order to keep the population stable. When the fertility rate falls, populations decline.
A low fertility rate can be offset by immigration, as has happened in England, several European counties and the U.S.
But other factors also impact the demographic picture. The drop in fertility in Europe, for example, has been affected by the recession. Statistics show that as youth unemployment rises, the number of marriages and new man-woman partnerships falls. Fertility rates follow a similar pattern. Not only are there fewer marriages in the population, but when jobs dry up, immigration slows and, in some nations, sometimes goes into reverse.
Spain, for example, has seen many of its recent immigrants return to their native countries because they couldn’t make it in Spain. In the U.S. immigration from Mexico and Central America has slowed dramatically due to the U.S. recession and the crack-down on illegals.
Because immigrants tend to be young and to come from cultures where the fertility rate is above rich world levels for a combination of reasons, when immigration slows or reverses the affect on a nation’s fertility rate can be dramatic. In Spain, for example, the rate fell from 1.46 in 2008 to around 1.38 in 2011. Unemployment in Spain has been in the high teens or low 20s through those years.
LOW FERTILITY rates have grave long-term effects. Fewer babies mean a smaller work force. Fewer workers in societies such as ours and those in Europe and industrialized Asia translates into lower tax revenues for the retirement and health care programs for seniors.
Paradoxically, those nations which have been most generous to their retired populations come under the greatest fiscal and political pressures when the revenues shrink upon which those programs depend.
How should governments react to this challenge? What policies can be put in place to encourage marriage and child-bearing? Free child care, paid parental leave, tax incentives are among them. Nations such as the U.S. also can adopt immigration policies to keep their work force growing — but those only are effective when the economy is expanding. At the other end of the equation, programs for the retired segment of the population can be cut back to fit the shrinking tax revenues.
All of these remedies will require action by government, which will be resisted by those who must pay more or receive less — and the prospects for that are dim. In Europe and, goodness only knows, in the U.S., the formula for persuading democratic governments to tackle and solve substantial social and fiscal problems has yet to be found.
— Emerson Lynn, jr.
