Fertility Rates and Household Wealth

A new U.S. government report noted that the birth rate continues to fall, now with a fertility rate of just 1.6 children per woman. That rate is considered “below replacement rate” meaning that the next generation will be smaller than the current one and that the overall population will grow older on average.

According to the World Bank, the overall percentage of the global population under 14 years old in 2019 was just 25.6%. It was just 18.5% for the United States, down significantly from 30.8% in 1961 in the post-World War II boom years.

There is a meaningful divide between the western world and the rest in terms of the number of children and how it relates to household wealth which will be reviewed here.

Children and Household Wealth around the World

There are three parts of the world which have a very young population, with over 35% of the population being 14 years old or younger: sub-Saharan Africa, several Muslim countries, and the islands of the Pacific.

Roughly 42% of sub-Saharan Africa is under 14 years old. Most of the countries are very poor, with a GDP per capital under $2,000. Outliers like Seychelles (with a relatively low 24% of the population under 14 y.o.) and Mauritius (17%) have much higher GDP per capita (GDP/C) of $17,448 and $11,099, respectively.

The other regions have a more scattered correlation between GDP per capita and high percentage of children as seen in the chart below.

Countries with over 35% of the population under 14 years old fall into three buckets: sub-Saharan Africa (not shown), Muslim countries (yellow) and Pacific islands (blue)

The blue dots represent Pacific island countries and the yellow dots correspond to Muslim countries. Pakistan, Tajikistan, Yemen and Afghanistan have GDP/C of around $1,000 or less. The two subsidized Muslim economies of Iraq ($5,955) and the Palestinian Authority ($3,562) are outliers in their relatively higher income levels and young population. Only Tonga and Samoa have similar around $4,000 GDP/C outside of Africa.

The United States

The GDP per Capita in the United States crossed $65,000 in 2019 while the fertility rate plummeted. The country has a diverse population so a deeper review of the drivers of the fertility drop as well as the dynamics of household wealth are worth exploring to appreciate the underlying causes.

As seen in the US Fertility Rate table above, the fertility rate for women of all races declined significantly between 2008 and 2016. The drop was greatest for Hispanic women (-26%) and Native Americans (-24%), followed by Whites and Blacks (-12% each).

The census data on average household income by race and status adds further color.

CharacteristicAll racesWhite alone, not HispanicBlack aloneAsian aloneHispanic (any race)
No Children89,31596,08160,794113,35470,604
With children <18119,506138,97079,151165,79380,592
Married no kids127,016132,34099,595141,35096,487
Married with kids146,238161,392123,121178,51094,336
Unmarried, no kids103,795107,34278,588156,37791,062
Unmarried with kids87,86595,92571,381(B)78,031
Male, no kids92,13399,11874,695123,49282,112
Male with kids83,98394,73363,69388,76473,777
Female, no kids74,95379,14869,54392,75564,067
Female with kids57,27465,24846,90090,47652,923
Household income for various US groups in 2019 according to the U.S. census. Too small a data set for unmarried Asian households with children at home.

There’s a lot of data here, so some observations:

Households headed by married couples with children at home make more money. Households (HH) with children under 18 at home make more money than those without, but that is purely driven by married HH. Asian married HH that have kids at home make an average of 26% more than married Asian HH without children. For Blacks the difference was 24%. Meanwhile, Hispanic married HH – and only Hispanics – without children make slightly more money than those with kids.

Non-traditional” HH with no kids make more money. Unmarried HH and those headed by either a single father or mother have greater wealth if there are no children. The difference is the greatest for Black HH headed by a woman, where average HH income is 48% higher if there are no kids at home, and for HH headed by Asian men, who make 39% more money on average if no kids are at home. Only HH headed by Asian women have virtually no difference whether there are kids at home or not.

Asian and Blacks have dramatically different household wealth. Not only do Asians make significantly more money than Black HH (86% more in HH with no kids at home and 109% more in HH with kids at home), the biggest drivers were in unmarried HH without kids and woman-headed HH with kids.

The change in household income adds additional color, with the table below showing the change from 2012 to 2019.

CharacteristicAll racesWhite alone, not HispanicBlack aloneAsian aloneHispanic (any race)
Married no kids38%38%40%39%35%
Married with kids44%42%51%49%50%
Unmarried, no kids35%34%37%62%20%
Unmarried with kids48%45%41%NA55%
Male, no kids38%41%42%37%32%
Male with kids41%41%35%34%44%
Female, no kids32%31%33%24%38%
Female with kids40%33%47%60%50%
Change in household income between 2012 and 2019 for various groups in the United States according to US Census

Households with kids have income growing faster. Income grew faster for households with children relative to those without kids between 2012 and 2019 for every type of household. Income grew fastest for those households headed by unmarried couples. Minorities faired better than Whites for female-headed homes with kids and married homes.

Hispanic households seeing the biggest gaps to an increase in income between having kids and not having kids. While Whites, Blacks and Asians mostly followed the averages or had mixed results, the Hispanic community saw big advances among those families which had children at home relative to the more modest gains among those with no children at homes.

In summary, the Hispanic community which accounts for 16.7% of the US population is having a steep decline in the number of children which is driving the overall low US fertility rates. While this is happening, the wealth for Hispanic households without kids is growing at a much slower pace than those HH with children. This is creating a gap in the Hispanic community between the wealthier HHs with children and the poorer ones which are having no kids.

Possible Reasons for Fertility Rates and Changes

There is clearly a correlation around the world that poorer countries have more children than richer countries.

The Guttmacher Institute estimates that 93 out of 1,000 pregnancies are unintended in poor countries compared to 66 in middle income and 34 in wealthy countries. Abortions are also more prevalent in wealthier countries with 40%, 66% and 43% of such unwanted pregnancies ending with an abortion in poor, middle and wealth countries, respectively. The net result is a higher fertility rate in poorer countries.

Religion should also be considered as a factor as many devout Muslim countries do not promote contraception and abhor abortions.

The low fertility rates in the United States goes beyond income and abortions.

Minority groups have the highest rates of abortion in the US. In 2016, 28% of abortions were by Black women even though they account for just 13% of the population. Hispanics accounted for 25% of abortions while they make up 17% of the population. This is in contrast to the global trend where poorer segments had fewer abortions.

In the US, Hispanics and Blacks still have higher fertility rates (2.1 and 1.9, respectively) than Whites (1.7) but the trends are much steeper for Hispanics as they are quickly adopting the more prevalent fertility rates found throughout America.

The lower fertility rates may seem strange relative to Pew Research which shows that women in America are having MORE children, albeit later in life as they prefer to pursue advanced degrees and build their careers. Pew notes that their work looks at the lifetime fertility rates of women whereas the standard definition of fertility is based solely on that one year’s accounting of births.

The Pew report also noted that one of the biggest changes in fertility is among women who were never married having children, where 55% of women aged 40-44 have had a child in 2014, up from just 31% in 1994. Incorporating the data above, this suggests that unmarried women are having children despite the fact that they are likely to be poorer for doing so, but the income level for this segment (unmarried moms) is growing the fastest.

Outlier

One country seems to be defying the trends in fertility, with a higher fertility rate and a high level of wealth: Israel.

From 2000 to 2019, Israel’s fertility rate stayed relatively constant, growing from 2.95 to 3.01. With a GDP/C of $43,600, this is a remarkable achievement.

The country’s ultra-Orthodox and Bedouin communities continue to have large numbers of children and the number of abortions in the country continues to hit new lows every year.


A quick read of the low and declining fertility rates in the US is certainly reason for concern, but a deeper dive into the numbers reveals some important facts. 1) Women are extending the period of time in which they have children to later in life so the total number of children they have is actually rising. 2) The drop off in fertility in the US is mostly due to the Hispanic community moving quickly towards the societal average. 3) The average income for the growing “non-traditional” households (unmarried, single parent) with children is growing faster than the rest of society.


Related First One Through articles:

Follow the Money: Democrats and the Education Industry

Hispanics for Trump

BLM Does Not Celebrate Father’s Day

Jerusalem Population Facts

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1 thought on “Fertility Rates and Household Wealth

  1. Pingback: Being Purple, I’m Neither Anti-Abortion Nor Pro-Abortion. I’m Anti-Infanticide | FirstOneThrough

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