Bad Economy? Fewer Babies

Alden Wicker

The economy affects birth rates

If you were worried about the economy, would you put off having a child?

That’s exactly what American women have been doing lately, as the birthrate has been dropping like a stone since the economy went bust in 2008.

In 2007—the same year the S&P 500 reached a record high—the number of births was a record high, at 4.3 million. But then, by 2009, as Americans saw their job prospects diminish and their savings shrink, the birthrate dropped to 4.1 million, the lowest number since 2004. And it looks like the number will drop even lower in 2010 to just over 4 million.

That’s 500,000 babies who were never welcomed into the world because of the recession.

Babies Go Bust

It’s no wonder. We recommend having at least $20,000 in the bank to cover the high cost of pregnancy and the first year of Baby’s life. But if you had that amount in your diversified investment account in October 2007, you would have seen it drop to about $11,500 by the next October. Plus, if you’re facing foreclosure like many Americans, the last thing you’d probably want is another little person in the mix.

At least it’s fortunate that women who are struggling financially and don’t feel ready for a baby will be more able to afford birth control come next year, thanks to this legislation.

So is this trend another unfortunate byproduct of economic woes—or a smart decision by thousands of women?

A Baby State of Mind

To prove it’s not just a cultural shift (like more women deciding to go child-free), the Pew Research Center studied the phenomenon state-by-state: States that experienced the worst economic declines also had the sharpest drop in births, and vice versa.

For example, North Dakota, which had the nation’s lowest unemployment rate in 2008, was the only state to see a slight rise in number of births that year. Meanwhile, Arizona—which got clobbered in the housing bust and subsequent economic decline—experienced a 4% drop in birthrates in 2008, the highest out of the 25 states for which data was available.

Unfortunately, your confidence in your ability to care financially for a child is correlated with race. The Hispanic population, which was hardest hit by the recession, experienced a larger drop in birthrates from 2008 to 2009, 6%, while the birthrate for white women dropped by 1.6%. Black women experienced a 2.4% decline in birthrates. This isn’t a unique event, either. During the Great Depression and the economic shock of the 1970s, the birthrate also slowed in response.

I Don’t Want a Baby … Yet

Interestingly, older women, who arguably can’t postpone having a child (and probably feel more financially secure as well), are the only group who has seen a rise in fertility the past few years. So for now, it looks like the decision to be childless is not a permanent one, but a postponement. Women are saying, “I’m going to wait until I’m financially ready for this child,” not, “I can only afford to have a certain number of children in my life.”

When the recession finally does end—and it’s anyone’s guess when it will—we could see a mini baby boom, as women who have been putting off having children start to bring them into their more financially sound households, according to Professor Alicia Adsera at the Office for Population Research at Princeton. “I would expect that some of these ‘delayed’ births should  eventually materialize as things turn around,” she says. Or, if the recession drags on too long, we may just see fewer children overall as women become too old to give birth, or decide, “that maybe they did not want to have as many children after all,” a sort of rationalization after the fact.

LearnVest Supports Moms!

The birthrate may have declined, but there were still 4 million births last year. That’s a lot of new mothers navigating this new emotional and financial territory. LearnVest wants to give mothers the information they need to thrive financially, no matter what the economic outlook.

Manage Your Finances and Stay on Budget With a Baby

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For more stories on how to balance life as a mom in these economically murky waters, visit our LV Moms page.

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  • Fabwtalk

    Me and hubby are getting married soon and would like to start a family not to long after.  We are on a steady financial track and have no problem saving and setting money to the side for a little one.  We could put it off and wait until the economy picks back up but if we do that, get pregnant and the economy is back in the crapper but baby is already here, then what? If you are in a decent financial situation and know how to save and budget it can work, it just all depends on one’s mindset.  Oh and you don’t have to be making 6 figures a year to do it. ;)

    • Riverolowen

      ‘Fab..’ If you have a child, hopefully it is not as illiterate as your Post shows you to be. 
      Perhaps, there should be a means test to prevent the ignorant and uneducated from breeding more like them.

    • Riverolowen

      “Me and hubby…” This posting only gets worse as it is read (“..economy back in the crapper”). I guess the preassure of spitting out a baby must render you completely illiterate and ignorant. Does anyone really wonder if the world, or, at least the U.S.
      isn’t getting dumber.

      • Stef

        You are the perferct example of the world getting dumber.  It’s pressure not preassure, by the way.  Maybe you could work on formulating a comment more clearly then lashing out at others who are just staing their own personal opinions.

  • Marnely Rodriguez

    Definitely am one of these women….Maybe later in life? Who knows!

  • Josan

    I would want to know of the babies born in 2010 and 2011 what % were on medicaid.

    • Jane

      Just look at your hospital’s Medicare cost report (Worksheet S-3, Part I) that they’re required to submit every year.  You’ll at least have a local picture of how many Medicaid days are devoted to the nursery (and NICU if that’s available).

  • Anonymous

    I am sure many won’t agree but really I think it is time to slow down population growth. How many people can the planet sustain? Each life has an impact on resouces leaving pounds of waste behind. DNA altered fruit and vegetables, hormone injected meat, it isn’t impossible to reverse this need. I’m not saying don’t have kids but these familes of 5+kids, in my opinion is out of control. When I look at the world I can’t help but question what kind of life the future holds for my 14 & 23 yr old boys. I know the future is always uncertain but I think the worst is yet to come.

    • k.

      i agree. i have many reasons for not wanting children, and this is one of them.

    • Ashleyleah

      I agree with this BUT I don’t see this as a reason to limit the number of children I have, but rather a reason to limit the number I give birth to. I would LOVE to adopt if we can afford the costs.

  • Krahulec

    Money is just one factor in deciding in the family planning process.  For me, I also looked at my family history.  If I were to have a special needs child, do I have the financial, emotional and physical support in place?  With insurance, job security, where you are living, who you are partner is, all of these factors impact the decision on whether to have a child, adopt or become a foster parent.  We were raised in a generation where women went to work, single mothers/fathers are not something to be hidden in the closet or shameful.  As we begin to shift our awareness of who we are, where we are in life and the own expectations we place on ourselves, we can then make an honest assessment of where we are in life.  Do I have the time, energy and resources to dedicate to a child?  it is a hard question to ask, but more important that where you thought you would be in life by now; or cultural ideas of who you think you should be.

  • Jessica

    I don’t think you should put off having children for anything.  What if you have a problem with infertility and you don’t find out until your 35 because you put off having kids so that you could have your career and feel financially secure first?  There is NO perfect time to have a child and in my opinion, no good reason to postpone the next step in your life (motherhood!).  When there is a will there is a way and if people would stop being so selfish and cut back their lifestyles a little bit, there’s always room to afford baby.

  • OCLawyer

    As a teenager, my mentor told me while she was pregnant wit her second child that you can never be truly financially ready to have a child. That is, no matter how rich or poor you are, a child will bring you into new financial territory and your job is to navigate it as best you can. My husband and I are chipping away at my law school loans as fast as possible because we do not want to pay my student loans until our future children are in college. The economy is very much a factor in our decision not to have children in the near future, but when the time comes and we are ready, we will start our family. My mentor taught me 10 years ago, and LearnVest continues the lesson today–a baby will change your financial landscape, but being in control of your finances is the best way you can prepare.

  • Anonymous

    Ah, when will this recession end? Good question. The president can’t pass a jobs bill, government seems to be out of touch with the reality the shrinking middle class and the growing lower class are facing. What will pull us out of the recession? I’d really like to know.

    I’m just grateful my kids are all grown up. They have so-so jobs with no health coverage, but it’s not from lack of trying on their part.. I have a friend that is childless and is starting to see that as a good thing due to Monsanto take over of our food supply, the recession and other negative things going on in this world. She says she couldn’t imagine bringing a child into this world. Ouch.

  • Cyndi Calhoun

    I’m a teacher in North Carolina and I’ve NEVER, EVER, EVER been able to have more than a few thousand in the bank as regular savings, let alone to have a child.  Now, I’m 32 and feel like it’s now or never to have a child.  But, my husband has been out of work and even when both of us were working, we were focused on paying off ALL DEBT except the mortgage.  I never spend more than $3.75 on clothes (yes, those are Goodwill prices) and on my salary, that’s what my child will wear, too.  It’s unfortunate, though, because I’m not in the stereotypical group to have to scrimp so much, and I have the equivalent of three college degrees (A BA in Anthropology and a BS in Spanish, plus three minors).  I completely understand that life doesn’t owe me anything, but sometimes when you talk these huge numbers (like having $20,000 in the bank, I feel so far removed from what you’re actually saying.  Bascially, I am a master at savings, I moonlight on the side to make extra money, we buy and sell things on the cheap, have a small mortgage, grow a lot of our own food…and still it’s a struggle.  That doesn’t matter, though.  I”m still going to have a child, even if I don’t feel like I have the money.  That day may never come when I actually feel like I have enough.  While I’m at it…maybe I should just go Occupy Wall Street to help with wage stagnation….

    • Riverolowen

      Perhaps, with everything else you should get a life and stop whining.
      Want to join Occupy Wall Street? You sound emblematic of these losers who
      cannot figure out what they want. No leadership, no program, no plan…wait, 
      sounds like the Obama Administration.

      • Guest

        Wow, you’re a bit of a hater aren’t you “Riverolowen”.  Who are you to assume that she wants to Occupy Wall Street?  I won’t assume to know where you come from but it is clear you are a hater of this administration but here’s a thought…why don’t you tell your folks on your side of the aisle to help Obama pass a the job’s bill for the good of the country!? All this BS of wanting him to fail is not helping our country and as “patriots”, isn’t that what they are suppose to be doing?

        • Guest

          Why shouldn’t Obama’s jobs bill pass?  Easy.  It penalizes those folks that can CREATE jobs (i.e. small business owners who are supposedly “rich” by Obama’s terms).  Redistribution of wealth by government mandate is not how to solve society’s problems.

        • Riverolowen

          Perhaps I mentioned Occupy Wall Street because she stated, ” maybe I should just go Occupy Wall Street..” Hate this administration? I do not hate, but I do loath inaction and empty speeches at a moment that calls for decisive leadership. Further,
          I pulled the voting lever for Obama, even as I held my nose, like many who felt he was the better of two bad choices.

  • Rach K

    II am definitely one of those people putting off having kids because of the recession. I’ve been unemployed for 2.5 years, and while we are getting by on my husbands income, I can’t see how we could afford a baby too. Hopefully I can get a job soon! Also, I believe that people have too many kids in general! We can’t sustain our current population growth!

  • Ashleyleah

    I’m 28 and my husband is 40. We have one baby and I’d like to have more. Even though I have plenty of time, I hate the idea of him being an “old” father. The economy has seriously been stressing me out as it is definitely delaying our plans to have more children. 

    • Riverolowen

      Welcome to the real, grown ups world.
      By the way, having yet another baby
      will not make you a real man.

      • Keboigbodin

        Maybe not, but a sibling is the best gift you can give a child.

        • Jane

          You’re kidding, right?  I don’t even TALK to my brother anymore because we’re so different.  Same goes with my dad and his sister.  Just because you share the same DNA pool does NOT guarantee that two people are going to get along.  The best gift my folks could have given me would have been just leaving well enough alone and letting me be an only child.

        • Riverolowen

          ‘ gift’? I would think that the BEST gift may well be a superb education.

  • Keboigbodin

    You will NEVER be financially ready to have a baby so don’t put it off just for that reason.  You will also never be emotionally ready or mentally ready or or or…. the list is endless.  Babies have a way of making your finances and everything else seem like less of a priority.  I had my last baby in 2009 and it was the best gift our family of  then 5 could have ever been given. She has brought so much joy, laughter and happiness into our home, who cares that we don’t have fully-funded college funds for her or our other 3 children.  Or that my husband and I don’t have fully-funded retirement accts and may need to work longer than some.  I wouldn’t trade any of my children for all the financial security in the world.  For me personally my security comes from my faith anyway and not my financial portfolio.  Children are a gift, not an expense.

    • Riverolowen

      ‘..don’t put it off..’ this reminds me, as it should every lucid member of the community, of the lunatic fringe bible thumpers who claim that god will provide!
      Right, until you lack the basics and have to visit the food bank for formula.

      • Jessica

        This is probably one of the rudest comments I have ever read.  Who are you to judge?!  What?  If you’re a church goer and want to have children even if you don’t have thousands of dollars in your account and own your home that means your a “lunatic fringe bible thumper”.  And here’s some news for you.  God DOES provide for those in need.  Maybe not the way people want, but He does provide.  And everyone who has a tight budget doesn’t just go running to the food banks for formula.  God helps those that help themselves.  They tighten their budgets up.  They stop eating out, they stop buying extra clothes or going to concerts.  They start making their meals at home and learn to live more frugally.  And if by your definition of a “lucid member of the community” you are referring to transparency, then I would agree that you are lucid.  It seems the things in life that have real meaning mean nothing to you.

        • Riverolowen

          Gee, Jessica you REALLY ARE emblematic of the little ‘hans frau.’
          I am sure that you would have been a contender for that TV program
          ’16 and Pregnant,’ but those girls have a personality, if not sound judgement.
          Perhaps, it was crazies, like you and your god fearing friends, that stopped them from getting family planning, rather than knocked up with a child they do not want, and cannot take care of. It appears that those breeders, continue to hanker for clothes, concerts, and bless their souls understand the value of an education….something that you obviously lack.

        • Poetess

          How does ‘he’ provide for the millions who die of hunger every year. Get out of your own head and learn something.

      • SwitchHitter

        Good thing I’ve never had to use formula with my kids!

    • Jessica

      Amen!  No one will ever be in a situation where they feel “ready” to have children.  Especially financially.  And who says that kids need to have fully funded college funds handed over to them when they’re getting ready for college anyway?  The majority of my friends have had to pay for school themselves and I think it has really helped to strengthen their character and made them learn how to be more responsible with their money.  Good for you for bringing those 3 little spirits into your life and making it work.  You may have to forgo some of the niceties of life, but the babies are all worth it!

  • Amira

     I know there are people that believe you cannot be truly financially ready to have a baby. However, I want to at least finish college and have a secure job. As much as I want I child right now, it will be that much harder to earn my degree if I had one now. I believe you’ve got to be prepared and I do not think there is anything wrong with that. You want to bring a child into a world of love and security. Not stress and insecurity.

  • Riverolowen

    The population of our fragile world just passed 7 billion, and counting.
    Can anyone guess where we are going to get water, food et al to cope with 

    • Guest

      “Overpopulation” is a lie pushed by the globalist elites through the liberal run colleges.

      • Riverolowen

        Really? ‘Overpopulation a lie…’ It would appear that you have been to neither elitist, or any college. The earth can only sustain a certain level of population, where you to have read anything you might well have understood that we are running out of water, air quality in many places is abysmal etc.
        It is counterproductive to breed at a time when we are facing monumental issues. Beyond which many of us are tired of paying for your demands you
        scream for to support your progeny. Get a life, and some knowledge. I am sure your husband (or other) may appreciate something other than a boring housewife.

      • Poetess

        How ridiculous? What evidence do you have to back up such an assertion? Have you been to other countries to see for yourself if they are overpopulated? What about this country? Obviously we have too many people to employ. With automation this will continue. We can’t even manage that, much less take care of the people outside our borders. Just because you learned to read doesn’t make you smart.

  • Lindsay Listanski

    As a recently married woman the title of this post caught my eye right away. I will never forget one particular moment of my wedding. As the lights came on at the end of the night and I watched my wedding slowly get broken down one votive candle at a time one of my relatives creeped up alongside of me, wrapped their arms around me and sweetly asked how soon until our family can expect a little one from us.

    WHAT?! Is she CRAZY I thought? As a young newlywed, 24 years old, I have worked really hard to be where I am today and have been blessed with a fantastic job. HOWEVER, despite the fact that both my husband and I make decent salaries, have little student loans and manage our  money fairly well the thought of having a baby, well frankly, scares the hell out of me. Not because I do not feel like I am ready in a maturity sense but strictly financially. With the economy the way that it is right now I am happy to be able to support my husband and I in a comfortable lifestyle with out much concern for penny pinching. At this point in our careers one never knows if the company is going to lay off those with the least experience or seniority. A baby just doesn’t fit into our financial cards right now. I agree completely with this post and hope to God that things get more stable in our world today so that I can feel more comfortable about starting our family on a solid financial foundation.