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Below is an complimentary research note from Demography Unplugged written by Hedgeye Demography analyst Neil Howe. Click here to learn more and subscribe.

Howe: How Will COVID-19 Impact Fertility Rates?  - 3 24 2020 2 35 28 PM

It’s a question some demographers are already asking: How will COVID-19 impact fertility rates? Historical research on epidemics indicates that fertility tends to decline in the short term and rebound in the long term, but the effect is far from consistent and heavily dependent on the scale and nature of the crisis. (Institute for Family Studies)

NH: The historical evidence suggests that the impact of deadly disasters on fertility is highly variable. It depends mostly on the severity of the disaster.

At the mild end--if the "disaster" consists mostly of events or warnings that keep people at home but don't actually result in much loss of life or property--the impact is often positive. Prolonged power outages frequently cause fertility rates to rise nine months later. So do low-severity storm advisories. (Contrary to "Netflix and chill" urban legend, the rise does not occur among single young adults; it occurs among married couples, especially those who already have one child.)

But as the severity of the disaster rises, the effect on fertility quickly turns negative. For example, as storm warnings shift from "tropical storm watches" to "severe hurricane advisories," later fertility declines. And once the emergency is associated with a significant rise in the regional death rate, the suppression becomes stronger. Once the death rate during the crisis rises 60% or more over normal monthly levels, the fertility impact is always negative. Hubei Province certainly exceeded that threshold in February, and Italy is hitting it today. It remains to be seen how many other countries will hit it as well--and for how long.

The threshold mortality delta is well-illustrated in the first chart below. Note that Lyman Stone, the IFS author, includes a variety of hurricane, tornado, earthquake, and epidemic disasters. In the second and third charts below, he shows the negative fertility hit in each case. But he also observes a well-known demographic fact: Short-term fertility falls are typically followed by short-term fertility rebounds. In nearly all societies, social institutions and each couple's longer-term "target fertility" tends to compensate falls with rebounds so that longer-term population growth is relatively unaffected.

What is likely to happen if COVID-19 turns into a significant mortality event in America? Stone offers two hypothetical scenarios (see chart three). One assumes an infection rate of 10% and a CFR of 0.5%; the other assumes an infection rate of 30% and a CFR of 3.5%. IMO, a more plausible scenario would be a higher infection rate (>50%) with a low-end CFR (between 0.5% and 1.0%). Given the curves he draws, that would likely lead as well to a significant fertility fall--and later rebound.

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ABOUT NEIL HOWE

Neil Howe is a renowned authority on generations and social change in America. An acclaimed bestselling author and speaker, he is the nation's leading thinker on today's generations—who they are, what motivates them, and how they will shape America's future.

A historian, economist, and demographer, Howe is also a recognized authority on global aging, long-term fiscal policy, and migration. He is a senior associate to the Center for Strategic and International Studies (CSIS) in Washington, D.C., where he helps direct the CSIS Global Aging Initiative.

Howe has written over a dozen books on generations, demographic change, and fiscal policy, many of them with William Strauss. Howe and Strauss' first book, Generations is a history of America told as a sequence of generational biographies. Vice President Al Gore called it "the most stimulating book on American history that I have ever read" and sent a copy to every member of Congress. Newt Gingrich called it "an intellectual tour de force." Of their book, The Fourth Turning, The Boston Globe wrote, "If Howe and Strauss are right, they will take their place among the great American prophets."

Howe and Strauss originally coined the term "Millennial Generation" in 1991, and wrote the pioneering book on this generation, Millennials Rising. His work has been featured frequently in the media, including USA Today, CNN, the New York Times, and CBS' 60 Minutes.

Previously, with Peter G. Peterson, Howe co-authored On Borrowed Time, a pioneering call for budgetary reform and The Graying of the Great Powers with Richard Jackson.

Howe received his B.A. at U.C. Berkeley and later earned graduate degrees in economics and history from Yale University.