Why There’s More Bad News Than Good in Falling Birth Rates

In most industrial nations, the average number of childbirths per woman has fallen below 2.1—the “replacement rate” at which population growth ­levels off. That may be good for a resource-strained planet. But for businesses and governments, it’s a looming challenge. One impact of declining fertility—a sinking ratio of working-age people to retiree—is already eroding social safety nets in the U.S., Europe, and Japan. Falling birth rates also threaten consumer-facing industries whose growth depends on ever-expanding pools of customers. To address the problem, we’ll need big gains in productivity and better immigration policy. Those solutions are anything but child’s play.