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14 Reasons Millennials are Having Fewer Babies

According to the Department of Health and Human Services, the U.S. birthrate has tanked. And who’s to blame? Millennials.

There’s been plenty of hand-wringing about this in the media, along with elaborate think-pieces about why this might be happening. But if you’re a Millennial, your response might be a solid eyeroll. To many of us, the reasons people our age aren’t having more—or any—kids are screamingly obvious. But strap in, because we’re going to get into those reasons anyway.

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Women have more options now

The #metoo movement has shown that the workplace is still anything but discrimination-free for women. Still, women have more choice about the direction of their lives today than at any other point in recorded history. 

According to the Pew Research Center, 36% of Millennial women held a Bachelor’s degree or higher as of 2017—more than men of their generation, as well as both genders of previous generations. And with education comes options.

Many highly educated women still choose to have kids, but others are pursuing different life purposes and goals. And that’s an option for us now. When you frame it as women just having more choices, it’s difficult to see the declining birth rate as a bad thing. 

Even so, it’s not that simple. According to Demographic Intelligence, there’s a gap between the amount of children women want to have, vs. the amount they wind up actually having. That gap—2.7 to 1.8—is the highest it’s been in four decades.

The data seems to indicate that many women in the U.S. would have more kids if they could, but something’s stopping them. If you’re a Millennial, I know exactly what you’re thinking.

It's the student debt, stupid

Student debt levels are at a record high: over $1.4 trillion

According to the Federal Reserve, Millennials in their 20s hold an average of $22,135 in student loans—with an average monthly payment of $351. According to a study by ORC International, one in three Millennials is more than $30,000 in the hole with student loans.

See also: The Key to Lowering Student Loan Payments

...but other debt is skyrocketing, too

Take a look at GoFundMe and other crowdfunding sites, and you’ll see that many people use these sites to pay for medical bills.

And credit card debt just hit a record high—about $6,375 per person, according to Experian. These particular statistics apply to the population as a whole, not just Millennials. But with their already-heavy student debt loads, Millennials are in a worse position to deal with unexpected medical expenses or credit card debt—their financial situation is more precarious to begin with.

When your financial situation is already unsteady, bringing kids into the world looks like a daunting prospect.

Millennials are underpaid

According to the Census Bureau, Millennials these days make about 20% less than Baby Boomers did at the same age.

Many graduated during a recession, when jobs and salaries were already down—and a large number had to take lower-paying jobs that didn’t require a college degree. Even when the recession ended, many stayed stuck in a cycle of underemployment and low salaries.

The gig economy is taking over 

It used to be that most people stayed with one company for a lifetime—and got their healthcare, a solid pension, and other perks through their employer. But those jobs have gone the way of the VCR—along with the stability they used to provide.

They’ve been replaced by a prevalence of short-term, freelance jobs that come with no protections and no benefits. Workers are on their own for healthcare, retirement, and other benefits they used to get through employers.

According to Nation1099’s recent exhaustive audit of gig economy studies, about 11% of workers in the U.S. are full-time freelancers—and many of these jobs don’t provide the kind of stability you can build a family on.

The housing market is tight 

Before you have a kid, you want a house, right? It’s not necessary—but if you’re considering starting a family, you may see it as a prerequisite. A house means stability and community; a place to put down roots. 

But many Millennial first-time home-buyers are shut out of the housing market. Trulia recently reported that the supply of starter homes decreased 14.2% in the first quarter of 2018—and while new homes are being built, they’re mainly in the luxury market.

According to the study, the prices for existing starter homes are on the rise. The median list price rose 10% from 2017—to $180,931—and mortgage payments for a home at that cost would take up about 41% of median income.

Millennials’ incomes are already stretched—between student debt, other kinds of debt and low wages, many just don’t have 41% to spare. That stops many from putting down the kind of roots that encourage starting a family.

Healthcare costs are through the roof

When it’s just you—and you’re healthy—it’s easier to justify going uncovered. But when you have a kid, it becomes a lot harder. When affording a kid means affording both health insurance and the medical bills it doesn’t cover, it’s no surprise many Millennials are opting out.

The United States is the most expensive place in the world to give birth. Costs vary wildly, but one study by Child Connection tagged an average price of $32,093—and $51,125 for a C-section. If you have complications of any kind, the cost can run into the hundreds of thousands. 

And you could have to pay for a lot of that out of pocket—even if you have insurance. A separate study by the International Federation of Health Plans listed an average amount insurers paid for hospital births as $10,808. That means many new families are being left on the hook for over $20,000—just for a routine birth.

This is just a tiny sliver of the healthcare cost crisis in the United States. Health insurance is often both extremely costly and stingy with benefits— which helps explain why medical debt is the top reason people in the U.S. declare bankruptcy.

Millennials are highly fiscally responsible

A recent Charles Schwab survey tracked 1,000 Americans aged 21 to 75 across several metrics to gauge their financial literacy, engagement, and ability to manage their money responsibly. 

Across a 0-to-100 index, the study found that the average American ranked a 49. Baby Boomers ranked 49; Gen X came in at 45 and Millennials scored a 51—higher than other generations and the national average.

The study showed that Millennials are more aware of their retirement accounts and engaged in investment decisions, demonstrate positive saving habits, and are more likely to have a written financial plan than other generations.

We’ve also written in the past about how Millennials are more engaged than other generations when it comes to charitable giving, and are more likely to pay attention to how their donations are spent.

There’s no question Millennials are financially savvy. They see clearly the challenges they face—overwhelming debt, stagnant wages and a tough housing market. To a financially aware person in that situation, adding a baby to the mix can seem reckless.
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No paid maternity leave

In addition to all these financial factors, the workplace is particularly hostile to working families.

The United States is currently one of only four countries that doesn’t mandate paid parental leave—the others are Swaziland, Lesotho, and Papua New Guinea.

Of private-sector companies, only 58% offer some form of paid maternity leave, according to the 2016 National Study of Employers. But for those who offer full pay, that number drops to 10%.

For those that do offer some form of maternity leave, the average length of time is 14.5 weeks, or a little over three and a half months—which is pretty scanty for women recovering from birth with a new infant at home.

No paid paternity leave

Only about 15% of companies offer some form of paid paternity leave for new fathers. The average amount of leave for them is about 11 weeks—under 3 months.

There's a stigma around taking leave

Even if your company offers paid parental leave, there’s often an unspoken stigma around taking that leave.

For fathers, that stigma was put in the national spotlight in 2014, when Mets second-baseman Daniel Murphy took a measly three days off to help his wife through a Cesarean section. He missed two games, including the first one of the season.

This caused an uproar. A number of sports commentators made insulting comments—including Boomer Esiason, who said “Quite frankly, I would've said, ‘C-section before the season starts. I need to be at opening day.’” The resulting controversy highlighted the stigma men still face when taking parental leave.

It’s not just famous fathers, though. According to a study by Deloitte and Touche in 2016, less than half of men surveyed felt comfortable taking paternity leave. One in three feared losing their jobs if they took it. 

... and it’s worse for women

The stigma for women is so bad, in fact, that it has its own name: the Mommy Penalty.

Despite the biases around taking paternity leave, men are seen as more committed to their jobs once they have kids—and they can expect an average 6% pay increase. Moms, however, are paid about 4% less for every child they have.

The reason stems from implicit biases. Men are perceived to be even more dedicated to work once they have children to provide for. But mothers are viewed as less focused and competent than their childless coworkers.

If they leave work for a few years to care for kids, it’s commonplace for new moms to struggle in getting their careers back on track.

Millennial women—the most educated cohort of the most educated generation—aren’t oblivious to this. When it could cost them the career they went into debt to earn a degree for, it’s no wonder many Millennial women are opting out of motherhood. 

Finding affordable childcare is next to impossible

Care.com’s Cost of Care Survey found that one in three families spend 20% or more of their yearly income on childcare.

There’s no question this has an impact. About 20% admit to having fewer kids than they’d like because of the high cost of care.

There’s less judgment around being child-free

Most of what we’ve listed above are negative reasons. But there are some positive reasons, too. One of those is that, in recent years, the stigma of being child-free has lessened somewhat—especially for women.

In 1974, 60 Minutes ran a segment on people who chose not to have children. The segment was not a positive portrayal, and the subjects suffered ostracism afterward.

We’ve come a long way since then. Women write freely about their decision to be child-free; there are dating sites that cater specifically to the child-free; and New York Times bestsellers like All the Single Ladies and Selfish, Shallow and Self Absorbed have put this decision in the spotlight in a positive way.

Sure, childless people—especially women—still feel pressure to have kids, and face annoying questions and assumptions from others. But it’s getting easier in recent years.

Converging factors

To Millennials, it's no secret why the birthrate is falling. The economic conditions are not conducive to having kids. Facing extreme financial constraints, the possibility of having to sacrifice jobs and careers, and waning stigma around choosing to be child-free, many people are making what they see as the most practical choice.

This will likely only change when the country becomes friendlier to working parents—and the student debt load is lessened.

See more posts about gaining your financial freedom.

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