Fewer babies, slower growth and the implications of declining fertility rates worldwide

It’s official: the world is running out of babies.

Once upon a time (around 1900), the average woman had about six children. Enough to comfortably fill a family portrait and a minibus. Fast forward to now, and that number has dropped from six to below two across most of the developed world. According to the UN, in just 25 years two-thirds of humanity will live in countries where fertility rates are below the replacement level — also known as the point at which each generation effectively replaces itself.

Replacement level fertility sits at about 2.1 children per woman. Why the extra 0.1? Because not every child survives to adulthood, and not every adult is physically able to have children. The mathematical “sweet spot” that keeps a population stable is 2.1: two parents, two kids, and a little buffer for the realities of life. Fall below that threshold, and over time the number of deaths starts to exceed the number of births. 

In plain English: we’re not currently making enough people to replace ourselves. And that has economists reaching for the panic button, because it’s not just about babies — it’s about how societies grow, spend and sustain themselves. By 2100, countries like Japan, China, Italy and South Korea could see their populations shrink by up to half.

It’s not quite Children of Men yet, but the trend isn’t looking good.

What happens when you invert a pyramid?

If you’ve ever seen one of those population charts shaped like a pyramid, you’ll know the drill: lots of young people at the bottom, fewer old people at the top. Well, that shape is changing. In many countries, it’s starting to look less like a pyramid and more like an obelisk — tall, skinny and top-heavy with retirees.

Across advanced economies and China, the share of working-age people is predicted to fall from 67% today to 59% by 2050. The global consumer landscape will tilt older too: seniors will account for a quarter of all consumption by mid-century, double their share from 1997.

In other words, the world’s shoppers are turning grey. And while that’s great news for retirement villages and hearing aid companies, it’s less ideal for GDP growth. The system we’ve built, where younger workers fund the lifestyles and pensions of their elders, starts to wobble when there are fewer workers and more pensioners cashing in.

When the economy retires

Here’s the uncomfortable truth: fewer babies today means slower economies tomorrow. Economists estimate that GDP per person could drop by 0.4% a year across developed countries between now and 2050. That might not sound like much, but stretched over decades, it’s the difference between thriving and treading water.

To keep up, countries will need to either double productivity (good luck with that) or have people work an extra one to five hours a week. Meanwhile, pension systems might need to siphon off half of all labour income just to support retirees.

That’s not exactly the future young people were promised. Instead of buying homes and starting families, they’ll be working longer to fund their parents’ golden years, like a kind of economic babysitting, but for adults.

South Africa’s ticking clock

So where does South Africa fit in? At first glance, we’re still the baby (no pun intended) of the global demographic family. Sub-Saharan Africa is the only region on Earth where birth rates are still above replacement level. That’s why economists call it the world’s “last demographic dividend”: a final surge of working-age people who can keep the global economy humming as the rest of the world greys out.

But that youth advantage won’t last forever. South Africa’s fertility rate has already fallen from over six children per woman in the 1960s to about 2.4 today, and it continues to decline. We’re not in “crisis” territory yet, but the trend line is clear. Within a couple of generations, our population pyramid could start looking suspiciously obelisk-like.

The real catch is that unlike countries like Japan or Germany, we don’t have the luxury of wealth cushioning to soften the blow. Our youth unemployment rate is among the highest in the world, and our social safety nets are already under pressure. If we age before we grow rich, we could find ourselves in the worst of both worlds: fewer workers, more dependents, and too little savings to go around.

Still, it’s not all doom and gloom. If South Africa and its neighbours can turn their youthful populations into productive workforces through education, digital skills and inclusive economic growth, the continent could power the next century of global growth. The race is on, and Africa is the only region still young enough to sprint.

Why nobody is having kids

The question, of course, is why all of this is happening in the first place. Why are birth rates falling almost everywhere?

It turns out the answer isn’t mysterious at all, if you consider maths, money and modern life. Women across the world are better educated, more career-focused, and less willing to sacrifice financial independence for motherhood than their grandmothers were a century ago. The cost of raising a child has skyrocketed, housing is unaffordable, and work/life balance is more theory than practice. Add in global instability and a touch of existential dread, and voilà: the perfect recipe for a baby bust.

Governments are scrambling to respond, some with cash bonuses for new parents, others with parental leave and childcare reforms. But fertility isn’t something you can simply “incentivise” back into existence. It requires rebuilding entire systems and adding in essential blocks like  affordable homes, flexible jobs, social stability and perhaps a cultural redefinition of what success looks like.

That’s a tall order for any government, especially one also trying to keep the lights on.

The shrinking future

So what happens next?

Picture a world that gets a little older, a little slower, and a little quieter each year. There will still be growth, just not the kind we’re used to. Consumption patterns will shift, economies will adapt (hopefully), and AI might pick up some of the slack in the workforce (if we’re lucky).

The global fertility crisis isn’t just about numbers. It’s about the shape of the future. For now, South Africa’s youthful edge gives it a temporary advantage, but demographics have a way of sneaking up on nations.

The real question isn’t if populations will shrink, but how societies will adapt when they do. Because in the race to sustain prosperity, the biggest challenge of the century might not be running out of resources, but running out of people. DM