Can the stagnation of incomes explain recent fertility trends in Europe?

Daniël van Wijk , Netherlands Interdisciplinary Demographic Institute
Tomas Sobotka, Vienna Institute of Demography
Krystof Zeman, Vienna Institute of Demography

Fertility rates declined in much of Northern, Western, and Southern Europe during the 2010s, whereas they remained stable or increased in many Central and Eastern European countries. In this study, we examine to what extent the unexpected fertility declines and divergent fertility trends across countries can be explained by differences in the income trajectories of young adults. We use country-level data on period total fertility rates (TFRs), differentiated by age and birth order, and tempo- and parity-adjusted total fertility (TFRp*). We analyse how these fertility indicators are associated with changes in real income, unemployment rates, consumer confidence, house prices and rent indices, and family spending policies, in 2007-2023. Within-between models show a strong positive association between changes in income and changes in fertility in 2007-2020, suggesting that the stagnation of young adults’ incomes in much of Northern, Western, and Southern Europe can explain an important part of the fertility decline. Positive income effects are also found for tempo- and parity-adjusted fertility, for women over age 30, and for higher-order births, indicating that stagnating incomes are not only linked with postponement of births, but also with declines in the period quantum of fertility. In addition, rising real rent prices are associated with declining fertility in this period. However, income trends are not closely linked to the period TFR after 2020, suggesting that other explanations are needed for the fertility decline during and after the COVID-19 pandemic.

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 Presented in Session 77. Flash Session Fertility, Economic Conditions and Inequality