U.S. birthrate plunges as child-rearing cost soars
The message hit with a startling combination of melancholy and mundaneness: Our eldest son was about to age out of our health insurance. Fortunately, he has a great job with a good salary and solid benefits — better than mine, actually — so I suspect he’ll be fine.
At the same time, though, the e-mail sent my thoughts wandering back to our early days of parenthood. Then and now, starting a family takes a heathy dose of faith and an even stronger capacity for enduring uncertainty.
In our case, the capriciousness of academic labor markets added extra anxiety, as professor jobs are tough to come by. When we welcomed our son into the world two weeks after I graduated from Washington State University, my employment situation was, to put it mildly, sketchy.
While I held a year-long post-doc position, and my wife was working as an early childhood education teacher at a children’s center in Moscow, Idaho, our prospects weren’t particularly bright. We just didn’t know.
Looking back, my wife’s job saved us.
Through her, we had access to affordable, high-quality childcare, and both of us could work outside the home. We weren’t getting rich, but we were surviving.
Ironically, landing my first teaching job at North Dakota State University a few months later complicated things. While my income went up, we lost our access to affordable childcare as the math for my wife’s career no longer worked. And kids two and three served to reinforce our awkward household calculus.
The root challenge was — and still is — that childcare falls into a weird market space.
An intermediate good, we basically buy childcare as an input into other processes. In this case, it is really an “ingredient” for both parents to work, and markets don’t handle such problems well.
Occupying a place between work and home creates a tension in how childcare is priced. If it is too high, people exit the labor force; if it is too low, no one provides it.
In this sense, our family’s challenges reflected the entire problem in a nutshell.
While we had the luxury of an early childhood educator in the family, we couldn’t afford to buy the service she provided to others. Consequently, we neither purchased nor provided childcare services.
To paraphrase a line from the great American philosopher Taylor Swift, “It’s us, we’re the problem.” After all, without us the market had neither demand nor supply, a decidedly unhelpful outcome socially.
There are, of course, textbook answers to this problem, mostly related to direct or indirect childcare subsidies. Indeed, there are solid historical precedents, including daycare centers at factories or public nurseries during the Second World War.
(What the end of these subsidies meant for “Wendy the Welder” and “Rosie the Riveter” postwar is a story for another day.)
Unfortunately, nothing on the horizon suggests such programs are likely to resume anytime soon. Although there has been limited discussion of a $5,000 “baby bonus,” that figure is almost laughably small.
According to Bureau of Labor Statistics data, full-day infant care typically costs between $8,000 and $15,000 per year. With many other programs designed to help working families enter the labor market currently under budgetary fire — WIC, SNAP, Head Start, Free and Reduced Lunches, etc. — prospects for truly easing childcare challenges seem slim.
This is all depressing.
Having kids increasingly looks like an unaffordable luxury, so it’s no wonder U.S. birth rates are in historic troughs and yet continuing to fall. According to the National Center for Health Statistics, the U.S. fertility rate hit an all-time low in 2024, after falling about 2% a year for most of the last decade.
Knowing where things stand today, and looking back with a quarter century’s perspective on child-rearing, I’m amazed we pulled it off. There’s no question we were luckier than many.
Of course, our world is changing now.
Like it or not, the e-mail from HR reminded us my wife and I are starting our slow pivot away from our child-rearing years. As that happens, I earnestly hope we, as a society, can find a way to ease, not amplify, the already daunting burdens working parents face.
About the writer: Eric Schuck holds a Ph.D. in economics from Washington State University and a professorship in economics at Linfield University. He’s twice been honored with Fulbright Fellowships to work and study abroad, once in South Africa and once in Lebanon. An officer in the Navy Reserve, he’s also served a pair of active-duty military tours in the Middle East. He and his wife are longtime McMinnville residents with three children.
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