This is what decrease U.S. beginning charges might imply for Social Safety


Women gave birth to fewer children during the Covid-19 pandemic.

If these low birth rates continue in the US, it could have sustained economic repercussions, including pension and social security benefits.

The overall fertility rate has been falling for years. In 1964 women of childbearing age had an average of 3.2 children. By 1974, that number had dropped to 1.8, according to the Center for Retirement Research at Boston College.

Looking back at 2019, the tentative total fertility rate was just 1.7, according to a March 2020 report by the Centers for Disease Control and Prevention. Then Covid-19 resulted in even fewer births than expected in 2020. Recent research from Cornell University found the U.S. birth rate declined 7.1% during the pandemic.

Pregnancies that have been postponed from 2020 to 2022 can be postponed to 2024 to 2026, according to the Center for Aging Research.

Still, there are reasons to believe that the birth rate could remain low.

According to Anqi Chen, assistant director of austerity research at the Center for Retirement Research, the age of motherhood has risen in both the US and other developed countries in recent decades.

Today, that age for women in the United States is around 30 years. At the same time, the total fertility rate of 1.7 children per woman as of 2019 was well below the replacement rate of 2.1 children.

Factors Affecting the Birth Rate

While women can expect two children, there are reasons that cannot occur.

In women in their thirties who are delaying childbirth during Covid-19, fertility problems could prevent them from having the number of children they are expecting.

“The more you delay, the less likely you are to meet your expectations,” said Chen.

Additionally, women who were in their early twenties during the global recession caused by Covid-19 could also have fewer children in their lives, Chen said. This is because starting a career under these conditions could have lasting effects on their professional development and their earning potential.

The birth rate is closely monitored by experts because of its impact on retirement, namely social security.

This program is a pay-as-you-go system, Chen said. Today’s workers pay for today’s retirement benefits. Then the future employees will pay the benefits when the current employees retire.

As a result, the Social Security Administration is closely monitoring birth rates. In their latest trustee annual report, the government agency increased the overall fertility rate assumption from 1.95 to 2 children, an increase of 0.09% from the 2020 report.

This forecast, along with an estimated slower overall improvement in mortality, were positive factors in the most recent estimates.

Still, the program as a whole faces a potential deficit that should drive lawmakers to act to avoid “steep cuts” in benefits that would begin in 2034, the Center for Retirement Research said. If nothing is done by then, only 78% of the benefits will be paid.

How fewer births affect retirement

For women who have fewer children, there could be a potential upward trend in retirement.

Many women face a so-called “maternity sentence” because their income falls with every child they have, which permanently reduces their lifelong income.

This can carry over into retirement, particularly due to the lower income from social security benefits.

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Women with fewer children could minimize the effects of the maternity sentence as their income would not suffer as much.

However, since social security is a pay-as-you-go system, fewer births would also mean fewer future workers available for the system. As a result, this could result in a “penalty for all” with less benefit for all, Chen said.

“If there are fewer workers in the future, it could definitely affect the amount of money going into the social security system, which would also have an impact on benefits,” said Chen.

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