Falling births and economic costs

Worldwide, families are increasingly having fewer children than in the past (or no children at all), and Sri Lanka is no exception to this universal demographic phenomenon. In light of the considerable decline in annual births in the country, many have raised alarm over low population growth while fearing the impact it could have on the future of Sri Lankan society.

A few have attributed the decline in birth rates to couples delaying having children due to COVID-19 as well as the 2022 economic crisis. However, figures clearly demonstrate that births declined even in 2015-19, a period marked by relative economic stability. The total number of live births declined from 336,097 in 2015 to 319,010 in 2019. Thereafter, unfortunate events post-2019 accelerated this decline, with the number of births dropping to 275,321 in 2022. Experts estimate Sri Lanka needs at least 330,000 births a year to keep the population stable, but birth rates are currently hitting record lows.

Today, newly wedded Sri Lankan couples face difficulties in starting their lives, as building a home has become a challenging task, driven by elevated costs. Moreover, modern-day women have prioritised pursuing their career paths over having children. There is a tendency among some young metropolitan women to remain childless as they view raising children as detrimental to their independence. The migration of thousands of young Sri Lankans—many of reproductive age—to find better-paying jobs abroad as well as seek permanent residence in developed countries has contributed in no small measure to this worrying demographic trend. According to the latest Population and Housing Census, Sri Lanka’s Total Fertility Rate (TFR) is 1.3, which is considerably lower than that of its regional neighbours—India at 1.9 and the Maldives at 1.7.

According to experts in demography, Sri Lanka has now entered the stage of ultra-low fertility—defined as a TFR of 1.3 per woman or lower—which leads to a shrinking and ageing population. Among ethnic communities, Muslim women show the highest fertility rate at 2.0, while Sinhala women record the lowest at 1.2. Interestingly, although Muslim women are known for having more children than their counterparts in other ethnic groups, their fertility has also declined compared to the past.

In a report published by Financial Times Chief Data Reporter John Burn-Murdoch, it is disclosed that, over the last 10 to 15 years, birth rates have gone into steep decline across a wide range of regions, cultures, and levels of economic development. According to the publication, in more than two-thirds of the world’s 195 countries, the average number of children born to each woman is now below the replacement rate of 2.1. In 66 countries, the average is closer to 1 than to 2. As a result, lower- and middle-income countries are now getting old before becoming rich.

Ageing populations result in increased spending on pensions and elder care, which pushes policymakers to either raise taxes or cut spending on infrastructure investment, or both. With fewer young people entering the Sri Lankan workforce, labour shortages are deepening across a range of critical sectors of the economy, such as agriculture and services, which invariably slows economic growth. This disturbing demographic challenge could hinder the nation’s cherished ambition of becoming a high-income economy, apart from serving as an impediment to attracting foreign investment and increasing exports.

Development planners need to pay serious attention to this challenge and devise practical and far-reaching policies to address the consequences of falling births. Opening borders to foreign workers in a systematic manner could resolve labour shortages in critical sectors of the economy to a considerable extent. Thought should also be given to offering generous financial incentives to encourage child-rearing and reverse the declining trend in births.