Europe's Fertility Slump

Europe's fertility rate has fallen to an average of 1.4 children per woman, echoing a similar decline in the U.S., where it’s now at 1.6. This isn’t just about numbers—it’s about skyrocketing costs, warped priorities, and the complex role of immigration. This article digs into what’s driving this trend, what it means, and how we can tackle it by focusing on personal freedom rather than government decrees.

History reveals these fertility slumps are recurrent yet intensified by modern policies. In the 1950s, the US averaged about 3.8 children per woman amid postwar prosperity and low living costs, while Europe experienced similar peaks before steeper declines—France fell from 2.7 in 1960 to below the 2.1 replacement level by the mid-1970s. The US remained above 2.1 until around 1971, but now parallels Europe's decades-long downturn. Industrialization transformed children from farm assets to urban expenses, a shift exacerbated in Europe by expansive welfare states that tax families heavily, often rendering childlessness more economical. Migration has long bolstered growth—Europe's post-colonial waves filled labor voids but sparked tensions when entangled with welfare, hindering integration.

More women are choosing to have kids later in life, with birth rates for those aged 40-44 climbing steadily since 1985. Skyrocketing housing costs don’t help—prices have more than tripled since the 1970s, thanks to strict zoning and building rules, leaving young adults stuck in tiny homes that aren’t exactly family-friendly. On the social side, modern life has shifted us toward smaller, more isolated family setups, a big change from the tight-knit, extended families of the past. And while women’s growing role in the workforce is a win for freedom and equality, inflexible labor laws can make employers hesitant to hire. OECD data shows how Europe’s maternity policies, though well-intentioned, sometimes backfire by discouraging hiring.

Fewer children create a ripple effect, driving up welfare demands and taxes, which in turn discourage young couples from starting families, all while we often overlook how technology could ease or expose these pressures. Policies like IVF subsidies in the US or Hungary’s tax incentives for parents might offer short-term boosts, but they come at a cost to personal freedom and public funds, often delivering only temporary results.

Culture plays a big role in shaping family size—take Israel, where the birth rate is about 3 kids per family, thanks to a mix of supportive policies and strong traditions that go against the grain. If left alone, markets could come up with creative ways to help families balance work and kids. Immigrants from countries where families typically have one more child than the local average tend to have about 0.12 extra kids compared to locals in their new country, but this small boost fades as they adapt over time, and some groups, like those from Eastern Europe, may even have fewer kids than locals, showing there’s a limit to how much people adapt. The bigger picture is worrisome: fewer babies mean aging populations, which puts a heavy burden on workers to support retirees. You see it in the U.S. with Social Security struggles and in Europe with pension crises. The UN predicts that by 2050, Europe’s old-age dependency ratio could hit 57%, much like Japan today, where labor shortages, sluggish innovation, and deflation are already dragging things down.

Immigration has been key to buoying Spain's economy despite persistently low birth rates among natives. Between 2022 and the third quarter of 2024, newcomers filled about 40% of the new jobs created, contributing substantially to population growth and helping fill labor shortages in sectors like hospitality, trade, construction, and agriculture. Still, with youth unemployment sitting at around 25.4%, there's ongoing debate about whether this influx suppresses wages, even as evidence points to migrants typically taking on tougher, less appealing roles that boost productivity overall. That said, economist Ludwig von Mises warned that when combined with expansive welfare systems, open borders can draw in lower-skilled workers and distort labor markets. However, tighter border restrictions could speed up population decline–and without continued immigration–Spain stands to lose population momentum, which would erode its tax revenues and hamper long-term economic vitality. Still, uneven integration often leads to tensions, as locals feel overlooked in their own communities.

Smaller families are weakening social ties, leaving older generations increasingly isolated without siblings to lean on, a trend starkly visible in Bulgaria where young people’s exodus is fragmenting communities. This dynamic also fuels inequality when voluntary support networks falter. Europe faces a growing crisis of lonely seniors, and the US is not far behind. Immigration brings vitality, with over 14% of EU newborns from non-EU mothers, but bureaucratic obstacles hinder integration, sparking resentment over perceived taxpayer burdens. Grassroots migrant cooperatives, however, build community bonds without top-down mandates.

Population decline is quietly eroding geopolitical influence, with the EU's global standing slipping. Immigration offers a lifeline, with inflows proving essential for aging economies struggling to stay vibrant. Eastern and Southern Europe are aging the fastest, losing their competitive edge without the influx of migrants to bolster their workforce. Persistently low birth rates leave countries with a stark choice: embrace open borders or brace for economic stagnation. In Spain, where the foreign-born population reached 19% in 2025, this influx drives economic growth but also stirs tensions, echoing historical unease seen in colonial eras. Libertarian thinkers like Murray Rothbard argue that free movement strengthens societies, but only if it’s not distorted by subsidies that burden taxpayers, which can fuel resentment and destabilize the very resilience immigration aims to foster. Generous welfare systems can attract less-skilled workers, increasing dependency if economic conditions sour, a concern Friedrich Hayek raised when he cautioned against policies that disrupt the natural flow of societal order.

When welfare systems grow too generous, they can quietly undermine drive and widen the gaps between people, sowing division where connection is vital. Think back to the early United States, before sprawling welfare programs, when open borders drew in waves of immigrants who powered a thriving, dynamic nation. Europe’s story is more mixed, its success tied tightly to how well newcomers weave into the social fabric. If integration falters, the pressure mounts—especially on pensions, with the OECD sounding alarms that plummeting birth rates could unravel economic stability. Globally, immigration can be a lifeline, preserving a nation’s influence, but clumsy policies risk igniting resentment, turning a source of strength into a flashpoint for unrest.

To breathe new life into struggling societies, we need to unleash markets by slashing taxes and regulations, which could cut housing costs by up to 30% and make it easier for families to thrive. Imagine communities coming together to form voluntary childcare networks, easing the burden on parents without heavy-handed government programs. For immigration, Ludwig von Mises had it right: open borders work best when welfare doesn’t distort the process, letting markets naturally guide newcomers to integrate and contribute. Tearing down trade barriers would spark wealth creation, giving families the financial breathing room they need. In Spain, loosening rigid labor rules could help locals and migrants find common ground, breaking the cycle of tension and mistrust. Ultimately, less government meddling and more personal responsibility—paired with strong, voluntary community ties—build societies that endure. America’s current struggles mirror Europe’s, but blending bold freedoms with smart immigration policies could restore lasting vitality.