We’re having fewer babies. Peak fertility in postwar England and Wales was 2.93 children per woman in 1964, but that has dropped to 1.6 today. The big falls were largely over by the late 1970s but there has been another decline in the last decade, sparking widespread angst and soul-searching about what could be done.
We’ve long known that bad economic times generally, and high unemployment specifically, mean fewer babies. Lower or more uncertain income matters because it is 100% certain that having children costs a lot.
But what should politicians do with this information? Well, a US study gives us a clue about what might help: unemployment insurance, what Brits know as unemployment benefits. Researchers found that the greater the insurance the state provides against incomes falling if people lose their jobs, the less the impact of unemployment on fertility rates.
You know what doesn’t help? Encouraging firms to lay off workers. That’s what the French government did in 1998 by increasing the Delalande tax – a layoff tax paid by firms who got rid of workers aged over 50. Research shows this reduced the actual and perceived job security of younger workers. The result? A reduction in fertility of 3.7 percentage points for younger workers feeling less job secure, who chose to have smaller families.
Any Brits feeling smug that this particularly stupid idea hasn’t crossed the Channel should hold off. A country that prioritises the assets of older generations, while leaving younger adults concentrated in lower-earning sectors, doing less secure jobs (the number of zero-hours contracts hit a record last week), bankrupted by childcare costs and renting poor-quality homes hasn’t got much to boast about. Fertility friendly it is not.
• Torsten Bell is chief executive of the Resolution Foundation. Read more at resolutionfoundation.org
