A Case Study in Population Decline: Latvia. NewsWire

NewsWire: 9/30/21

• As many countries face the possibility of rapid population decline, it’s already the reality in Latvia. The country is dealing with both low birthrates and an exodus of young people. (The Wall Street Journal)
• NH: We often write about declining fertility rates and nations heading towards the dreaded “population decline.” And the three Baltic countries provide excellent case studies of what this looks like. Number one example: Latvia. Its total population has declined every year since 1991. That's a compound annual shrinkage rate of -1.1% per year. 

• There are two main drivers behind this trend: low fertility and high emigration.
• In 1987, Latvia’s TFR hit a high of 2.15, just above replacement (2.1). But with the breakup of the Soviet Union in 1991, its TFR tanked, hitting a low of 1.09 in 1998. The country soon enacted pro-natalist policies like child allowances and family housing stipends. While the TFR has increased to 1.61, it's still well below replacement. 

• Latvia has also suffered from a mass exodus of young people. After the fall of the Soviet Union, many youths moved to Western Europe in search of higher wages. When Latvia joined the EU in 2004, many more took advantage of open borders. According to the UN, Latvia’s net migration rate (per 1,000 population) for 2015-2020 is -7.6. That’s the second-lowest in Europe, just behind Lithuania. (Technically, Lithuania has experienced net positive immigration since 2019, though this uptick is not reflected in the UN data.)
• Latvia's falling population is causing a host of economic problems. Compared to 2021, its working-age population is expected to decline -13.5% by 2030. Brain drain is a particular concern. Currently, Latvia has the lowest number of doctors and nurses per capita than any other EU nation. During a pandemic, that’s not a good place to stand out. 
• So is there any way to reverse this trend? Latvia's Baltic neighbors Estonia and Lithuania are trying to overcome population decline with pro-immigration policies. But Latvia rejects this approach. Like Hungary and the Czech Republic, it fears that immigration will dilute its culture and heritage and thus accelerate the emigration of natives. Instead, the government is amping up its baby bonuses. The child allowance was doubled this year. (For a recent update on pro-natal trends, see "Global Demography Review.")
• In the end, Latvia is a warning to other countries. Once the demographic tide is far enough advanced to result in absolute population declines over more than a decade, it's difficult to reverse the erosion.