Almost half the global population now live in countries where women, on average, give birth to fewer than the 2.1 children needed to keep population levels stable. Europe and East Asia have struggled with declining birth rates for decades and the cost of an aging population exiting the workforce is set to hit America particularly hard over the course of the next decade. Schools are being turned into eldercare facilities and that spells trouble for a global economy built on the assumption that demand for goods will grow. It also incentivizes governments to incentivize would-be parents to get after it, prompting policy shifts. But will new policies implemented with mixed success abroad by adopted by the United States? With the country’s birth rate hovering around replacement level and its political system in turmoil, the answer is complicated.
There are two ways to stave off population shrinkage. Letting in refugees and trying to alter birth rates. At this point, the latter is a more politically (if not morally or environmentally) tenable option. That process is underway in Japan where the birth rate has grown from low with some favorable effects to problematically low. Over the past decade, Japan’s life expectancy has soared while its birth-rate has slumped so severely the population is projected to shrink by as much as a third, from 128 million to 85 million over the next few generations. Of those 85 million, up to 40 percent are projected to be over the age of 65, meaning that only around half the population will be of working age. If you’re a part of the Japanese government, those numbers start to look positively frightening.
Why is this happening? Modern Japanese women are growing more and more resistant to arranged marriage as they pursue careers. At the same time, stagnant wages, increased part-time work and steep house prices are convincing Japanese men that having families is impractical.
“In principle, it is possible for strong economies to operate regardless of population size, but it’s a lot more difficult to actually grow the economy if the population is shrinking,” says Enzo Weber, economics professor at the Institute for Employment Research in Nuremberg. “As the workforce shrinks, regional labor markets dry up and the network effects break down. This can create a real burden on social security.”
Since the 90s, the Japanese government has rolled out several initiatives to get its population in the mood for procreation. The Angel Plan, the New Angel Plan and the Plus One Policy are three separate schemes that have each attempted to improve facilities for families with children. But the government has consistently failed to invest after mandating change. Prime Minister Shinzo Abe’s government has been criticized for directing 70 percent of its social welfare funds to programs for the elderly while putting just four percent aside for child-based services.
“Better child care facilities, subsidies for families, more gender equality – these factors promote higher fertility,” says Reiner Klingholz, director of the Berlin Institute for Population and Development. “Decades of low fertility can result in countries being caught in a ‘low fertility trap’. Japan, Germany, and Austria have already experienced this. In those countries, small families have become the norm and it becomes hard to see that changing.”
Think that’s an overstatement? Scope the new nickname for Europe’s oldest country: “A Land Without Children.” It’s a moniker public officials loathe, but have a hard time trying to shed. UN predictions indicate that the population will dwindle from 82 million to 75 million by 2050. It’s a less extreme case than Japan–in part because of the country being open to migrant workers–but still severe enough the German government is hustling to step up daycare and parental leave benefits in the hopes of encouraging more men to get involved in childcare and, in so doing, expand the workforce.
“The primary goal is to set incentives for a more fair sharing of burdens in the household and to strengthen women’s chances to participate in working life,” says Weber. “Germany’s policies aim to do this by encouraging fathers to be more engaged with child care.”
A combination of recent laws have been drafted in by the German government in order to grant every child the right to care. The institutional drive towards more family-friendly work arrangements, combined with financial incentives for parents, have reversed the trend towards declining birth rates, but only slightly. Critics initially complained that, like in Japan, the financial follow-through came up short, with Germany’s federal states failing to share the costs. While investment in childcare is now on the increase, demographers aren’t anticipating a baby boom any time soon.
“Germany spends more money per newborn in family policy than any other OECD country,” says Klingholz. “Even still, at best we can only expect it to lift fertility rates from 1.4 children per woman to 1.5.”
As things stand, thirty percent of the nation’s women are childless, with the figure 10 percent higher for university educated women.
In the past few years the US has become more familiar with the demographic challenges facing Japan and Germany. Fertility rates have hit their lowest point in more than a century and estimates suggest they won’t return to replacement levels any time soon. The tightening of border controls during and after the Great Recession has prevented workers from migrating so easily, meaning that often permanent settlement has replaced circular flow.
“Because migrants tend to have kids soon after their arrival, and their birth rate decreases with the duration of their stay, migrant fertility in the US has fallen a lot over the last decade,” says Tomas Sobotka, fertility and family research group leader at the Vienna Institute of Demography. The current political climate isn’t helping. “Trump’s policies are likely to keep this trend continuing,” notes Sobotka.
But Trump doesn’t just have immigration policies. He also has child care policies, notably a tax cut that critics have been quick to point out could put over $7,000 back in the pockets of wealthier parents while provide relief to poorer families in the form of $5.55. It is not a particularly popular program largely because child care costs in many states exceed 30 percent of the median family income, which means that it does not offer substantive relief of provide a means to increasing income generation.
The Trump proposal that seems more likely to do that is a thinly sketched government parental leave program pushed by Ivanka Trump. That program would mandate time off for both fathers and mothers, which studies show helps keep women in the workforce and may drive up birth rates by making the decision to have children less daunting as a matter of immediate economic need. Still, the program is paltry by European standards and unlike to turn around the downward trend of the American birth rate.
Interestingly, though, programs to intercede in America might prove more effective than those in other countries precisely because the government is currently doing so little. America doesn’t have the biggest gap between actual family size and ideal family size, but 40 percent of women say they would like to have more children. Whereas the Scandinavians say that in the context of plentiful benefits, a mother in Maryland says that knowing full well that there are few programs encouraging her to procreate. In other words, a stimulus bump could be a real thing for would-be American kid makers.
Will the sliding birth rate turn American policy toward what has become the norm in old Axis powers? It’s unclear. The truth is that American politics are far different than politics in either Germany or Japan. That said, President Trump has forecast a level of economic growth that will not only require more hands on deck but more hands overall. Is it possible to make America more efficient? Sure, but it’s harder than making the workforce bigger.