Falling fertility rates: new challenges to the European welfare state

Abstract

One of the biggest issues currently plaguing many advanced industrialized countries is the persistence of below-replacement fertility rates (fewer than 2.1 children per woman). Decreasing fertility rates threaten economic growth, while government budgets have to accommodate more pension and health services, as the number of adults of working age who contribute to older generations' pensions diminishes. In addressing the dilemma of low fertility in Europe, we are inevitably confronted with a combination of institutional and human factors: while governments can attempt to put into place institutions and policies that will encourage childbirth (such as subsidies for children, family leave policies, and day care facilities), population reproduction is fundamentally a micro-level decision. The crux of the matter is that women and men must choose to have children; no number of institutional configurations will by themselves result in the birth of babies. Rather, it is the combination of systems of welfare provision, people's ability to provide for their well-being, and the choice of women and men to conceive children, that will likely result in increased fertility rates across Europe. This article examines several factors that influence the makeup of state, market, and family decisions, surveying literature in the field of work and family reconciliation and fertility decisions. The article concludes by highlighting several issues of societal polarization that are related to family policy and indicates avenues for future research on fertility and government policies.

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