Is a Lousy Economy Responsible for the Baby Bust?

Over at Vox, Alex Press says that it’s not just teen birthrates that are down. Birthrates are down among all age cohorts. But why?

That brings us to the economics. Following a significant drop in the birthrate after the 2008 recession, women are continuing to have fewer children. Why hasn’t the rate recovered?

….Sociologists and economists agree that the economy plays a role. One study even found fertility rates to be a “leading economic indicator” — predicting downturns (and upticks) in advance — while another found the sharp decline in fertility rates to be “closely linked to the souring of the economy” that began around 2008.

One reason for the continuing low fertility rates, then, is that the economy hasn’t recovered. Sure, GDP may be back up and unemployment back down, but the economy isn’t just quantitative; it’s people, and quality of life is a critical measure of economic health. If women want children but think they can’t afford them, the lag in birthrates should raise alarm about just how much “recovery” the average American is experiencing.

OK, but what does the quantitative economy have to say? If a poor economy is really to blame, I’d expect to see a bigger fertility drop among working and middle-class women than among affluent women. The latter have experienced a more vigorous recovery, and they have less reason to worry about personal finances anyway.

So what do we see in the data? Believe it or not, the Census Bureau has a fertility series broken out by household income. It only includes four years since 2006, but that’s enough to give us a rough sense of who’s having babies these days:

At a first pass, it looks to me like the story about the economy holds up. Among the upper middle class, the number of women who had babies in the past year has gone up—in fact, it never went down during the Great Recession in the first place—and among the middle-middle class the fertility rate has been nearly flat. However, among the working poor and the working class, fertility is down substantially compared to 2006.

This doesn’t prove that the Great Recession played a major role in the fertility downturn we’ve seen over the past decade, but it certainly makes the economic claim more plausible. And since millennials are currently the generation at prime babymaking age, it makes sense that it’s primarily a lousy economy for millennials that’s at fault.

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