Last weekend, something unusual occurred – a demographics expert went viral. Not usually the purview of front-page news, a piece by Dr Paul Morland, of Oxford University, on how Britain could improve its falling fertility rate provoked accusations of Nazism and of treating women as incubators.
Certainly, some of Morland’s suggestions were stupid, some even cruel. The “negative child benefit” tax, financially punishing not only those who do not wish to have children but those who simply cannot, particularly deserved the ire it drew. Meanwhile, the proposal that the Queen send a telegram to those who have a third child is milquetoast when the scale of the demographic challenge ahead of the UK is considered. But our plummeting fertility rate does carry serious economic consequences and the conversation Morland started, does need to continue.
The UK’s birth rate has fallen to an unprecedented low, the pandemic accelerating a decades long trend. To compound that, we are now skirting around the edge of a recession, with an established link between economic performance and birth rates: good times produce baby booms and bad times baby busts.
But what does this actually mean for us? Fewer births means fewer young people, resulting in a smaller workforce. A smaller workforce is less productive. It generates less tax receipts, even as the ruinous expense of an ageing society mounts, particularly in terms of pensions and healthcare. Imagine what this might look like in fifty years’ time, as a rare baby in a pram is disproportionately fussed over, living standards falter alongside economic growth, and we run critically short of workers to care for the elderly.
Instead of punishing childless people as Morland suggested – parenthood is not for everyone – we must create a country in which couples want to become parents. Polling shows only one in eight childless people aged 18 to 24 have already decided they do not wish to have children, meaning there are a great many young people who may simply require the right economic conditions to do so.
Those conditions do not currently exist in the UK. Despite the gift to our future that those who have children give us all, they pay a high price for their generosity. Previous analysis has pegged the cost of raising and supporting a child from birth to age 21 at an incredible £230,000, and that was before the cost-of-living crisis. Reducing this cost on parents must be the immediate priority of any strategy to improve birth rates.
Factors such as housing costs and the general cost of living are extremely relevant, but perhaps the lowest hanging fruit for policy makers keen to avoid a future of economic decline is childcare reform.
The UK has the third-highest childcare costs in the developed world: a full-time nursery place for a child under two is £274 a week. The high cost can force primary carers – almost always women – out of the labour market because their wages cannot match these costs, rendering a career, no matter how fulfilling, an economically insane choice. This disincentivises parents from increasing the size of their families, and encourages couples to delay having children until their careers are more established.
We need only to look across the Channel to see what demographic rewards we might reap from an affordable childcare system. France has worked hard to make childcare inexpensive to couples by providing high quality public care – its prize is the highest birth rate in the EU and a brighter economic future.
Fresh plans to reform nursery care in the UK were announced this week, with the ratio of teacher to child for under two-year-olds set to be reduced. But even children’s minister Will Quince was busy downplaying the effect this would have on family finances. Real change to the childcare system is complicated, but it will also be worth it. It will be an acknowledgement of the cost of kids and lay the groundwork for a sunnier economic future for us all.