The ultimate indicator of personal economic confidence is the determination to perpetuate the species and have children. The chart below shows annual US births from 1910 through 2017 and it is estimated there were 3.84 million births in 2017, nearly a hundred thousand fewer than in 2016.
The 2017 figure is also nearly a half million fewer than the late 1950’s baby boom era peak and likewise below the subsequent mid 2000’s double peak. The 2017 figure is also nearly six hundred thousand below the Census estimates provided as recently as 2000 and 2008.
To offer some perspective, the chart below shows annual births versus total US population…despite the total population nearly doubling since 1957, the US had 11% fewer children in 2017 than 1957…or 2007.
More poignantly, below is the US childbearing population (those aged 15 to 45 years old)…the red columns represent the annual change while the blue line is the total 15 to 45 year old population. As can be plainly seen, the growth of the childbearing cohort represented by the “baby boom” on the left dwarfed the growth represented by “millennials”, on the right. Of course, on a relative basis (%), the millennials represent less than a third the annual quantity of growth than the boomers offered…and millennials high levels of education driven indebtedness and poor quality of employment, etc. mean the quality of growth they represent is even lower than their numbers would indicate.
A last note regarding millennials, their estimated “growth” was never organic (as births essentially never exceeded those during the “boomer” period) and instead was almost entirely dependent on estimates of continued high rates of immigration…the same immigration that has dramatically slowed since the early 2000’s. Chart below shows the sources of 15 to 64 year old population growth (declining births vs. immigration…annual average per 5 year periods) since 1970. Given this, there is a high probability that the size of the millennials significantly undershoots estimates.
Births continue to decline since 2007 (represented by columns in the graph below) while the Census birth estimates continue to tumble (lines below represent select Census Est.’s from 2000 through 2017). The Census estimates for ’00 and ’08 (essentially identical) anticipated annual births would rise to 5.7 million by 2050 (and continue rising thereafter). However, after the ’09 GFC and ’10 Decennial Census, the Census Bureau began dramatically reducing their present and future estimates for growth. Nevertheless, each reduction was still far too optimistic.
Total births continue to surprise to the downside and significantly lower estimates are needed if the Census forecasts are going to match reality. I offer a more realistic “guesstimate” (dark blue line) based on the ongoing changes to the childbearing population and current trends. Even immigrants quickly norm to the lower fertility rates once in the nation. Simply put, the conditions for family formation and child rearing continue to deteriorate. The US isn’t alone, detailed (HERE), and the situation within the US is dire detailed (HERE), (HERE), and (HERE) but the question remains. Why are birth rates and total births declining amid a growing population and record levels of wealth?
The chart below shows the fast decelerating US fertility rate versus record Household Net Worth. The previous peaks in HHNW saw corresponding upticks in the fertility rate, but not this time.
Unfortunately, since ’07, nearly all the benefits of this record “wealth” creation are being accrued by a fraction of Americans. The federal government and Federal Reserve programs have benefited asset holders while penalizing the working class with fast rising costs of living (record rents as a % of income, record insurance, higher education costs, reduction/elimination of pensions and job related benefits, etc. etc.) absent the higher wages with which to pay for these. It appears the present and future generations opportunities are being sacrificed to maintain and further a select group in the here and now.
The chart below details the growth in household net worth by income levels from ’07 through ’16. Those that have significant assets have been further enriched…those without have been punished (and as the saying goes, “the beatings will continue until morale improves“).
The continuation of the present policies will only further grossly enrich a shrinking minority while continue to penalize those of childbearing age (among others). This will only further push the birth rate into negative territory (well below replacement level). The Fed’s inequitable cure is essentially saving the elderly patient at the expense of the present and future of the patients offspring. The merit of an economic system which results in the childbearing populace unable and/or unwilling to perpetuate the species is sorely in need of reconsideration and reconstruction.