Are Finances To Blame for America’s Declining Birth Rate?

Newborn baby sleeping on a white rug.
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According to the latest data from the U.S. Census Bureau, the American population grew at the slowest rate since the 1930s during the last decade. And while there are numerous factors that could be contributing to a declining birth rate, it seems that finances are playing a role.

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A recent survey of women age 18 to 51 without children conducted by the healthcare data management firm Harmony Healthcare IT found that among those that don’t plan to have children or aren’t sure if they want children, 44% cite financial reasons as the reason why. Among all of the women surveyed, 62% said the cost of raising a child is preventing them from starting a family.

The Complex Relationship Between Motherhood and Finances

Although it may seem that financially well-off women would be more likely to have children than those that are struggling financially, this isn’t always the case.

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“There is a messy relationship between finances and childbirth,” said Fergus Hodgson, director at Econ Americas. “Poorer countries and communities tend to have higher birth rates. Further, higher-earning women face a higher opportunity cost of childbirth. In other words, successful women in prominent careers sacrifice more to have children than those in less lucrative areas.”

As Women Become More Career-Focused, They May Become Less Family-Focused

In addition, as women become more successful in their careers, they may choose to forgo marriage and childbearing altogether.

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“What many of these women are likely saying, if one reads between the lines, is that they cannot find marriageable men — men with sufficient earning capacity to make the women want to marry and focus on home and family life,” Hodgson said. “This has been a long-term trend going back decades, as women have risen in economic independence and raised their expectations for being willing to be homemakers.”

Given that this is a long-term trend, Hodgson does not believe that the birth rate will continue to decline.

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“Since the origins of this trend date back to the 1960s and 1970s, with the ramifications now largely manifest, the reduced childbirth rates are likely to be flattening out and not deepening,” he said.

Many Women Don’t Have the Option To Leave the Workforce

While some women may actively choose to stay in the workforce, others simply can’t afford to take time off to have kids.

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“A recent report from the U.S. Department of Agriculture found that just the first year of a child’s life costs their parents $12,500, an expense that many young couples cannot afford,” said Liam Hunt, financial writer and analyst at SophisticatedInvestor.com. “Plus, the costs of child-rearing are inherently gender-biased. The emotional and physical labor of child-rearing often requires the mother to take significant time off of work. However, women now compose the majority of the U.S. workforce, and more households depend on dual-parent income than ever before. Given the financial responsibilities of child-raising, it’s simply economically unfeasible for households who cannot afford to [have a partner] withdraw from the workforce.”

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Current Economic Factors Make It Impossible for Some To Afford To Have Children

“The ever-increasing costs of living, rising inflation and the unaffordability of child care services have made starting a family impractical for many and outright irresponsible for some,” Hunt said. “In the absence of affordable public child care and expanded maternity and paternity leave benefits, we’re likely to see couples postpone child-rearing until later in life.”

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About the Author

Gabrielle joined GOBankingRates in 2017 and brings with her a decade of experience in the journalism industry. Before joining the team, she was a staff writer-reporter for People Magazine and People.com. Her work has also appeared on E! Online, Us Weekly, Patch, Sweety High and Discover Los Angeles, and she has been featured on “Good Morning America” as a celebrity news expert. 

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