Concerns Mount Over Accelerating Economic Contraction Amid Plummeting Birthrates

 Concerns Mount Over Accelerating Economic Contraction Amid Plummeting Birthrates

Worries intensify as the economic downturn, coined as "shrink+economics," appears to be accelerating due to a concerning decline in birthrates and an aging population. Newly released data from Statistics Korea's "Statistics on Newlyweds in 2022" reveals a significant drop in the number of children born to newlyweds, reaching the lowest point since tracking began in 2015. As the average time for newlyweds to have their first child increases and the proportion of couples without children rises, concerns grow about the potential impact on the economy, exacerbating the existing challenges of a shrinking workforce.

Growing apprehension surrounds the pace of the economic downturn, characterized as "shrink+economics," driven by a worrisome decline in birthrates and an aging demographic. The latest data from Statistics Korea's "Statistics on Newlyweds in 2022," disclosed on November 11, indicates a significant drop in the number of children born to newlyweds, raising concerns about the potential consequences for the economy.

The report reveals that newlyweds married for five years or less had an average of just 0.65 children, marking the lowest figure since tracking began in 2015. This decline continues a trend observed since 2015 when the average stood at 0.82. Notably, the time taken for newlyweds to have their first child has increased steadily, reaching a record high of 17.9 months last year, up from 15 months in 2015.

The proportion of newlyweds without children has risen to 46.4%, a 0.6 percentage point increase from the previous year, and the highest level since 2015. Conversely, the share of couples with children decreased by 0.6 percentage points to 53.6%. The total number of newlywed couples also decreased by 6.3%, with 1.032 million couples recorded, the lowest figure since 2015.

Experts express concern that these trends may exacerbate the ongoing population decline in South Korea. The country entered a phase of natural population decline in 2020, where deaths exceed births, and the total population, including resident foreigners, has been decreasing since 2021. Dr. Lee, a prominent figure, notes, "The decline in the number of newlyweds in their fifth year of marriage or younger, who are responsible for more than 80 percent of newborns born in a year, means a direct hit to the population."

Addressing the issue, Dr. Lee emphasizes the need for creating an environment conducive to child-rearing, including improvements in working conditions for a better work-family balance and comprehensive labor reforms. The economic repercussions of a dwindling workforce and population decline pose challenges that warrant urgent attention and strategic interventions.

As concerns mount over the potential acceleration of economic contraction tied to demographic shifts, policymakers and stakeholders face the task of implementing effective measures to reverse or mitigate these trends and secure a sustainable economic future.

Key Takeaways:

1. The economic downturn, referred to as "shrink+economics," is raising concerns due to a notable decline in birthrates and an aging population.
2. Statistics Korea's latest data on newlyweds in 2022 reveals the lowest number of children born to couples married for five years or less since tracking began in 2015.
3. The average time for newlyweds to have their first child has reached a record high of 17.9 months, contributing to concerns about a shrinking workforce.
4. The proportion of newlyweds without children has risen to 46.4%, the highest level since 2015, impacting the overall population dynamics.
5. Experts warn that these demographic trends could further accelerate South Korea's population decline, necessitating strategic interventions and policy measures.

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