Britain's baby gap threatens demographic crisis

Feb 20 2006 by Brian Amble Print This Article

British women face a 'fertility penalty' if they have children earlier in life and almost a third return to a less well paid job than before they give birth, according to new research by the Institute for Public Policy Research (IPPR).

The average woman forgoes £564,000 in earnings over her lifetime if she has her first child at 24 compared to a similarly educated childless woman; but if she waits until 28, she will forego £165,000.

IPPR's analysis also suggests that the 'baby gap' between the number of children Britons want and the number they actually have is over 90,000 a year.

What's more, because Britons are having children later in life and more are remaining childless, the UK is facing a demographic 'fork in the road'.

The ageing population means that taxation will have to rise to keep public spending at current levels. But fertility rates make a difference: if fertility falls, the basic rate of income tax rate would need to be 2p higher within fifty years than if it rises, and 9p by 2074.

But the report warns against French style tax incentives to encourage women to have more children because they have acted as a disincentive for women to return to work.

Instead, it recommends improved family friendly entitlements, a tackling of the gender pay gap and more state supported childcare to enable people to have the number of children they want, without damaging their careers.