Australia’s fertility rate is now at a record low of 1.48 babies per woman. Gene Tunny and John Humphreys discuss the sharp fall in fertility rates worldwide and what it means for Australia’s economy and society. They explore how declining birth rates threaten our economy, government budgets, and social cohesion, and whether migration, pro-natalist policies, or cultural change can reverse this trend.

Gene would love to hear your thoughts on this episode. You can email him via contact@economicsexplored.com. 

Timestamps

• Introduction to Episode on Decline in Fertility Rates and Economic Implications (0:00 )
• Discussion with John Humphreys on Fertility Rates (5:12 )
• Economic and Social Forces Driving Down Fertility (14:16 )
• Impact of Low Fertility Rates on Asset Prices and Social Cohesion (15:50 )
• Challenges of Migration and University Policies (20:25 )
• Historical and Sociological Factors Influencing Fertility Rates (29:57 )
• Potential Solutions and Policy Recommendations (40:15 )

Takeaways

1. Australia’s fertility rate has fallen to 1.48 births per woman—its lowest level ever and far below the replacement rate of 2.1.
2. Migration isn’t a sustainable fix: fertility rates are also falling in nearly every country, even traditional migrant sources.
3. Economic and cultural shifts—urbanisation, delayed marriage, individualism, and welfare-state expansion—have weakened traditional social structures supporting families.
4. The Baby Bonus experiment of the 2000s temporarily lifted fertility, but its effects were uneven and costly.
5. Long-term implications include labour shortages, rising welfare burdens, asset price declines, and profound cultural change.

Links relevant to the conversation

ABS births data:

https://www.abs.gov.au/statistics/people/population/births-australia/2024

e61 analysis of the Baby Bonus:

https://e61.in/australias-fertility-decline-evidence-and-policy-experience/

Birthgap documentary:

https://youtu.be/m2GeVG0XYTc?si=vuZvBqwVkZn3q1oZ

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