The age of the big Latin American family is over

JP Spinetto, Tribune News Service

In Mexico City, one of the world’s most populous metropolises, babies are becoming a rarity. Official figures show that the average number of children expected to be born to a woman over her lifetime — the fertility rate — has collapsed to 0.96, from 1.34, in only five years. That fall matches an astonishing decline on a national and regional level: Latin America’s ageing, slow-growing population is now similar to those in Europe and North America. While ageing populations and lower fertility rates are global trends, the consequences are more acute for Latin America. It’s the most unequal part of the world, and slower population growth and a faster demographic transition make the problems of inequality and subdued economic activity harder to solve, especially as countries try to pay for retirement, education and health-care programs. That said, the region is not without options — but its leaders need to choose wisely.

The numbers are stark. The average fertility rate for Latin America and the Caribbean has fallen to 1.8 this year, just above the 1.5 to 1.6 level of the rich countries in the Western Hemisphere, according to a recent United Nations report. That means the region is already below the 2.1 children-per-woman threshold necessary to maintain its population level, other things being equal — what’s known as the replacement level. The region’s fertility rate dropped 68% between 1950 and 2024, the fastest decline in the world.  Some of the reasons for this trend in Latin America are similar to those elsewhere: There is less social pressure for women to have babies at a young age. Contraception is more accepted and more available. People are living longer and spending more time in school before entering the workforce. Couples tend to wait until achieving a certain standard of living before considering children.

But there are also reasons specific to Latin America. Simone Cecchini, director of the demographic center at the U.N.’s Economic Commission for Latin America and the Caribbean, says the region has made considerable progress in reducing the number of teenage pregnancies. On the other hand, he notes, its recurrent macroeconomic crises and financial uncertainties tend to discourage people’s interest in becoming parents.  In 1950, Latin America’s fertility rates were similar to Africa’s. By the end of this century, he says, they will match Europe’s. Demographically speaking, “this is a very significant and rapid change.”

It all means that the region’s so-called demographic dividend — basically, when the labour force grows faster than the population — is expected to end in just five years, according to the U.N. report (there are a lot of differences within countries, but I’ll consider the region as a whole). Fewer working-age adults make it harder for governments to provide support to increasingly elderly populations, which could slow economic growth.

In a region notorious for a shortage of both public services and public funds, there is a risk that this transition will result in a lower standard of living for retirees and fewer resources for students. That could start a vicious cycle of weakening future demand.

But all these factors, as difficult as they are, don’t change the underlying challenge for Latin America: The region just needs to grow faster, period. If it became more productive and more inclusive, that would reduce inequality and foster opportunity.  Achieving these goals will be difficult, of course. But it would do more to compensate for the fertility decline than replicating specific policies tried elsewhere.  It’s worth noting that some of the (very expensive) ideas implemented by richer nations to boost birth rates don’t seem to be very effective; it’s very hard to influence people’s long-term personal choices. It’s also worth pointing out that Latin America’s relatively young population, which it has enjoyed for decades, has not automatically translated into faster growth.

In the end, Latin America needs to improve its standard of living to increase its fertility rate, not the other way around. The focus should continue to be on improving social and economic conditions, such as financial stability and reliable government services. Achieving gender parity in the labor market, which still overwhelmingly punishes women and couples who choose to have children, will require a cultural shift in the attitudes toward work-family balance. Governments should also encourage the elderly to invest some of their savings, for example, or to continue working beyond retirement age if they choose.  All these are policies Latin America should be pursuing regardless. The bottom line is that the era of the large, boisterous Latin family, with dozens of relatives gathering for birthdays or celebrations, isn’t coming back. But governments have some very powerful tools to help their citizens navigate the change.