The global economy is not prepared for an ongoing global population crash, as deglobalization has been kicked into hyperdrive in the US over the last decade. Even in America's generous social welfare state, "fertility rates" or "births per woman," another way to look at it is in terms of missing births have suggested a lost decade of babies.
The Institute for Family Studies (IFS) asked this question:
If the population of women who might have kids changed the way it did over the last decade, and if fertility rates had remained at their 2008 levels (the last time we had replacement-rate fertility in America), how many more babies would have been born?
IFS came up with an estimate of 5.8 million babies. On average, the US produces around 4 million babies per year. The number of missing births is almost like no one had babies for an entire year and a half.
The first figure is the difference between if 2008 birth rates were sustained and actual births tracked by the Centers for Disease Control and Prevention. The data shows most of the missing babies were seen with Hispanic and White moms. At 2008 levels, Hispanic moms were having on average 2.8 kids, and now the figure is more like 2. The 33% slump in Hispanics' fertility rates resulted in 2.7 million missing Hispanic babies. Whites were the second largest population that made up missing babies, with almost 2 million.
The second figure shows how births are down across all racial segments of the population.
IFS said ethnic minorities in America suffered the sharpest decline in birth rates since 2007.
Hispanic births in 2019 were almost 30% below the number that might have been born, or about 860,000 births. Indigenous peoples are similarly far below trend, totaling about 81,000 missing births, and 13,000 just in 2019. Although births have declined among non-Hispanic whites, it is not as severe. Among Asians, there are over 210,000 missing births, making 2019 births 15% below their expected value, yielding about 47,000 missing Asian-American births per year. Finally, for African Americans, there are over 850,000 missing births, with 2019 births running 16% below the stable-fertility scenario. Non-Hispanic white births in 2019 were just 14% lower.
If birth rates were to maintain 2008 levels. It would have accelerated the pace of racial and ethnic change in the US.
These changes have meaningful effects on the racial and ethnic mix of the United States. Had birth rates remained at 2008 levels, 2019 would have been the first year when non-Hispanic whites did not represent a majority of new mothers at about 49.5% of moms. But because fertility rates declined so much more for minorities than for non-Hispanic white women, instead, the non-Hispanic white share of births actually rose between 2008 and 2013, before declining more recently. As is, non-Hispanic white mothers will probably not become a minority of new moms until 2026. Falling birth rates postponed this minority-majority shift by six years.
Many people wrongly believe that higher birth rates will prevent America from becoming a minority-majority country, but this is wrong. Because racial birth rates tend to converge towards each other over time while sharing similar cycles due to economic and other shocks, increases in birth rates tend to yield relatively more babies among minority moms. Moreover, because minority women make up a larger share of reproductive-age women compared to their share of the general population, fertility, in general, tends to cause a change in racial demography. On average, a baby is less likely to be white than a current adult, so having more babies tends to make the country more racially and ethnically diverse.
IFS offered the government advice to bolster higher birth rates by expanding the child tax credit across all racial and ethnic groups.
Millions of missing babies and slumping fertility rates in the US are bad news for the economy.
Family formation and child-rearing are the drivers of spending and consumption. A loss of millions of babies in the US over the last decade suggests slower growth is ahead.
To prevent a plunge in the economy and asset prices, we outlined how "declining quantity of females of childbearing age coupled with ongoing declining fertility rates means births will continue declining... and organic demand declining... and only via destructive federal government / central bank ZIRP, NIRP, and market manipulation, can consumption and asset prices be manipulated upward."
... and just when everyone thought the rollout of the vaccine was going to save humanity and the economy, it turns out new research has uncovered COVID-19 is reducing fertility in men.
This leaves us with one scenario: crashing fertility rates not just in the US but possibly the world may continue for the time being.
Fewer births and longer life expectancy will also mean a drastically older population.