TRANSITION ECONOMIES: LESS MONEY, FEWER CHILDREN

Press Release
REC/91

TRANSITION ECONOMIES: LESS MONEY, FEWER CHILDREN

UN/ECE Releases Its First 2000 Economic Survey of Europe

(Reissued as received.)

GENEVA, 26 April –- "The economic and social crisis was a prime force behind the large fertility decline in transition economies of Eastern and Central Europe, as well as in former Soviet Union republics", stresses Miroslav Macura, Chief, Population Activities Unit of the United Nations Economic Commission for Europe (UN/ECE). The Economic Survey of Europe, just released by the UN/ECE, shows that the onset of the political and economic transformation of the European transition economies has ushered in profound demographic changes, including a surge in international migration, divergent mortality trends, with temporary increases in many cases, and a precipitous decline in fertility in many parts of the region.

Fertility fall started in 1989 ...

The fall in fertility, the Survey stresses, started within a few years beginning in 1989. In most of the then European Soviet Republics and in Romania, it got under way in 1989, in much of Central Europe in 1992. In the former German Democratic Republic, where fertility fell more than anywhere else, it began immediately after the collapse of the Communist regime. In much of the former Republic of Yugoslavia, a gradual decline was already under way in the 1980s, and this continued without any major interruption as the country disintegrated (see chart 6.2.1).

Once the fall in fertility rates got under way, it generally proceeded without interruption beyond the middle of the 1990s. The major exception is East Germany, where recovery began after total fertility had reached an astonishingly low rate of 0.76 children per woman in 1993. In the majority of these countries, the decline has either decelerated in recent years or, as the data for 1997 and 1998 suggest, came to a stop or even, in some cases, turned into a modest recovery. Where the decline, at least for the time being, appears to have run its course, the total fertility rate has generally reached levels that are very low by European standards. In 1998, these were mostly below 1.3 children per woman, with Latvia (1.09) and Bulgaria (1.11) having the lowest rates. The average fertility rate in the transition economies in 1997 was 1.37, a third lower than in 1988. For comparison, the average rate in the European market economies in 1997 was 1.58. Within 10 years, fertility in the transition economies has fallen from an average rate that ensured the replacement of generations of the population to two thirds of that level.

- 2 - Press Release REC/91 4 May 2000

... and was mainly due to economic and social conditions ...

The start of the transition process was everywhere accompanied by large declines in output, employment and real wages, which combined to produce a reduction in total real income from employment accruing to the household sector, a major determinant of the living standards of, among others, individuals and couples in their childbearing years. Reversals of the decline in real income have occurred in Central Europe, although its recovery was not complete by 1998. Elsewhere in the region, a minor recovery has occurred in many countries, but in 1998 the level of real income from employment was nowhere higher than 50 per cent of its 1989 level.

Governments shared the experience of households, in that their incomes fell, as well. Partly because of this, State support to families with children fell in all the transition economies except Slovenia and Romania. The declines have been larger for two- than for one-child families. At the same time, some of the services provided to families with children (for example, institutionalized daytime child-care) that were once free or nominally priced have become more expensive. The real cost of children, therefore, increased as the real incomes of their parents fell. As a result, individuals and couples postponed, or abandoned altogether, having children, thus preventing their living standards from falling even lower.

... but also to changes in life style

The analysis published in the Survey provides ample evidence for the view that falling incomes had a depressing effect on fertility. However, this is only part of a bigger picture as other factors were also at work. In particular, the return of civil society to these countries reinstated rights and freedoms that were denied to the citizens of the former socialist countries. Also, the Survey argues that the norms and values that are now in the ascendant, and are consistent with the new political and economic order, have enlarged the scope for individual choice and decision-making in many areas of behaviour. These changes have encouraged new patterns of reproductive and family behaviour and new life-styles conducive to a trend away from conjugal life and children. The Survey suggests that expanding education, particularly among women (see chart 6.3.7), which has occurred throughout the region, might also have encouraged the spread of new forms of behaviour leading to lower fertility. These developments appear to have taken place primarily in Central Europe, where fertility has continued to decline despite the fact that the economy and living standards have started to improve.

Fertility recovery could be fostered by family policies

As governments in many transition economies view the current very low fertility rates with concern, the question arises as to whether they can do anything to assist its recovery. "Some recovery, although possibly not a major one", stresses Mr. Macura, "is almost certain to occur in a number of countries irrespective of what governments do because the impact of postponed births on the total fertility rate will eventually wane." Beyond that, where further recovery is judged necessary, "governments may be able to raise fertility by reinvigorating

various family policies, including the provision of financial or tax benefits to individuals and couples with children, as well as measures enabling them to balance more easily their parental and work roles. "Although expensive, these policies can be successful and are not incompatible with a market economy -– but they do require lots of political will", concludes Mr. Macura. Such policies can be very valuable: they add to the well-being of families and children; they help individuals and couples to approach, if not attain, their desired family size; they enable women to have children and remain in paid employment; and they can help to bring aggregate fertility back towards replacement levels, a goal that is judged important by many societies concerned with their long-term survival.

For further information please contact: Miroslav Macura, Chief, Population Activities Unit, Economic Analysis Division, United Nations Economic Commission for Europe (UN/ECE), Palais des Nations, CH-1211 Geneva 10, Switzerland. Tel: (+41 22) 917 27 64; Fax:(+41 22) 917 01 01, E-mail: ; Website: .

* *** *