US birth rate falls to lowest level in 32 years

US birth rate falls to lowest level in 32 years (NBC News)

• The US Center for Disease Control & Prevention’s National Centre for Health Statistics recently confirmed that the number of babies born in 2018 fell to the lowest level in 32 years.
• The number of births in the year was 3,788,235 – down 2% from 2017.
• A major finding of the report is that fertility levels are reaching record lows – with the US now at 1.73 (1,728 births per thousand women)
• Some of this is due to good news (for instance teen births are down)
• Putting the numbers in context – fertility rates in Europe are even lower (1.58), with Southern Europe even lower still  (1.3), which is lower than the oft-quoted Japan (1.44)

Analysis & Comments

• Demographics is becoming an increasing problem for many western countries
• Why does this worry me – its partly about the contribution of population increases to GDP growth (basically more workers). This is especially important given the apparent issues around per worker productivity growth
• In addition, there is the healthcare angle. As people live longer they consume more healthcare resources (the data on this is scary)- and with fewer new workers coming through the question of who pays for it gets tougher to answer
• One big offset for the US is immigration (less so for Europe)

This low birth rate could be a burden for GDP growth in the future. It also affects inflation levels and pension system. This is an issue that western countries (and soon China) need to address.

What is your opinion on this topic?