Tuesday, August 11, 2015

U.S. Births increased in 2014

by Bill McBride on 8/11/2015 11:24:00 AM

This provisional data for 2014 was released in June and shows a possible impact of the great recession ... and recovery.

From the National Center for Health Statistics: Births: Preliminary Data for 2014. The NCHS reports:

The 2014 preliminary number of U.S. births was 3,985,924, an increase of 1% from 2013. ...

The general fertility rate was 62.9 births per 1,000 women aged 15–44, up 1% from 2013, and the first increase in the fertility rate since 2007.
Here is a long term graph of annual U.S. births through 2014 ...

U.S. Births per Year Click on graph for larger image.

Births had declined for five consecutive years prior to increasing in 2013.  Births are about 7.7% below the peak in 2007 (births in 2007 were at the all time high - even higher than during the "baby boom"). I suspect certain segments of the population were under stress before the recession started - like construction workers - and even more families were in distress in 2008 through 2012. And this led to fewer babies.

Notice that the number of births started declining a number of years before the Great Depression started. Many families in the 1920s were under severe stress long before the economy collapsed. By 1933 births were down by almost 23% from the early '20s levels.

Of course economic distress isn't the only reason births decline - look at the huge decline following the baby boom that was driven by demographics. But it is not surprising that the number of births slow or decline during tough economic times - but that is over now.

U.S. Births per YearThe second graph is from the NCHS report and shows births per 1,000 women by teen age group. From the NCHS:
The preliminary birth rate for teenagers in 2014 was 24.2 births per 1,000 women aged 15–19—yet another historic low for the nation. The rate was down 9% from 2013 (26.5) and has declined more than 7% annually since 2007. Since the most recent peak in 1991 (61.8), the rate has declined a total of 61%. In 2014, the preliminary number of births to women aged 15–19 was 249,067, down 9% from 2013 and 44% from 2007 (444,899)
Far fewer teens births is great news (and is probably related to the much higher enrollment rates).

Another key trends ... women are waiting longer to have babies:
The preliminary birth rate for women aged 20–24 in 2014 was 79.0 births per 1,000 women, down 2% from the rate in 2013 (80.7), reaching yet another record low for the nation. The rate for women in this age group has declined steadily since 2007 at more than 4% a year. ... The rate for women aged 25–29 was 105.7 births per 1,000 women, essentially unchanged from 2013 (105.5).. Since 2008, the rate for women in this age group has declined more than 1% a year. The number of births to women in their late 20s increased 2% from 2013 to 2014.

The preliminary birth rate for women aged 30–34 in 2014 was 100.8 births per 1,000 women, up 3% from the rate in 2013 (98.0). The rate for this group has increased steadily since 2011. The number of births to women in their early 30s also increased in 2014, by 4%. The rate for women aged 35–39 was 50.9 births per 1,000 women, up 3% from 2013 (49.3). The rate for this group has increased steadily since 2010. The number of births to women in their late 30s increased 5% in 2014
Waiting longer to have children makes sense (see: Demographics and Behavior) and we should expect a baby boom in a few years as the largest cohorts move into the 25 to 34 years old age groups.

P.S. I expect that as families have babies, they will tend to buy homes (as opposed to rent)!   The demographics are favorable for renting now, but eventually the demographics will be more positive for home ownership.