Baby Boom or Bust?

When the pandemic sent the world into lockdown in March 2020, many commentators quipped that a mini baby boom would follow nine months later. The reality was entirely different. Financial insecurity, increased parental responsibilities and anxiety about the future, along with other difficulties, prompted many to delay or forego having a baby. Economists are now projecting 300,000 fewer births in the United States this year than would have been expected before the pandemic. 

Demographic changes can have economic ramifications. Falling birthrates mean smaller generations of taxpayers will eventually be responsible for supporting larger generations of retirees. Historically, therefore, governments have viewed a declining birthrate as an existential threat, raising the spectre of decline or extinction. The question of how direct government action might encourage a higher birthrate is not new; European governments have been grappling with this question for decades, France foremost among them.