SHAPING THE FUTURE HOW CHANGING DEMOGRAPHICS CAN POWER HUMAN DEVELOPMENT

BOX 4.9:
Ageing countries begin encouraging larger families
Even in the face of ageing, well-designed policies
have enabled some countries to keep their birth
rates at desirable levels. In Sweden, for example,
enabling women to work as well as become mothers
has helped birth rates rise. Swedish parents receive
480 days of paid parental leave for each child,
of which up to 60 days are reserved for fathers. The
law also prohibits women from being dismissed
from jobs due to reasons related to marriage or
childbearing. In Norway, the state, municipality
and parents share the burden of childcare, with the
state’s share being about 40 percent of the total
cost. Subsidized public childcare programmes expanded
extensively through the 1980s and 1990s,
and nearly 66 percent of children now have access
to these. Parents who do not use them can receive
an equivalent cash bonus.
Family-friendly policies have helped France attain
one of the highest fertility rates in Europe, even
as female labour force participation is higher than
the average for countries in the Organisation for
Economic Co-operation and Development (OECD).
France spends a significant 3 percent of GDP on
family policies. Additional tax breaks and monthly
stipends kick in from the second child. Women can
take maternity leave, reduce the number of hours of
work and receive childcare support for up to three
years. Immigration has helped keep birth rates high
in the United Kingdom, although family policy in
the last 10 years has also played a role, including
through extending maternity leave from 16 weeks
to 54 weeks. Public childcare has been very limited,
covering only 2 percent of children under age three,
the lowest ratio in Western Europe. Reforms now
seek to extend public facilities and provide low-cost
care for poor families.
In Asia-Pacific in 2014, the Republic of Korea had
the lowest fertility rate. People are disinclined to
have more children in part because of high costs of
schooling and childcare. Women struggle between
choosing a career or staying at home to care for
children; only half participate in the labour market.
The Government now aims to extend public childcare
to cover 30 percent of children by 2017, and
also to encourage expansion of private health care.
Policies are being devised to reduce the length
of the workweek, increase parental leave and cut
costs of education.
Sources: Rønsen 2004, Ivanovićc 2008, Toulemon, Pailhe and Rossier 2008, Toulemon et al. 2008.
shortage of younger workers, economic slowdown
and increasing fiscal pressures have led
some to encourage people to have more children.
In October 2015, China’s one-child policy was
abolished and replaced with a two-child policy
aimed at overcoming the negative socioeconomic
implications of ageing. Countries in Europe,
including France, the United Kingdom and
Scandinavian countries have successfully increased
fertility rates close to the replacement
level. The Government of the Republic of Korea
is incentivizing higher fertility by lowering the
cost of education.
Japan’s latest draft population policy aims to
increase its birth rate by supporting local governments
and others in sponsoring speed-dating
events and matchmaking, and offering more
paternity leave and fertility centres. Australia
and Singapore have introduced baby bonus
schemes and considerable cash incentives to
improve fertility rates. Box 4.9 shows how different
national polices have been effective in
reversing falling fertility rates.
Although fertility in many ageing Asia-Pacific
developed countries may rebound in the coming
decades, it will probably not reach replacement
level in the foreseeable future. Any increase
would need at least a couple of decades before
becoming ‘visible’ to the labour market. In
this context, expanding the labour force can
be done primarily by increasing female labour
force participation, raising the retirement age
and encouraging immigration. In most cases,
the first two will be sufficient to maintain a
reasonable balance between people working and
dependents. In other instances, international
migration is the only option in the short to
medium term to address risks from rapid ageing
combined with greater demand for health care.
As migrants are usually younger, migration
is often proposed as a quick solution to labour
shortages, including among care workers. It can
make a significant contribution to the economy
and to individual well-being, as long as the
process is managed in a way that upholds the
safety and rights of people who decide to migrate.
Some countries want
people to have more
children to slow
the speed of ageing
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