Economic impact of population aging can be postponed, says IBGE president

A survey of data from the IBGE (Brazilian Institute of Geography and Statistics) carried out exclusively for the CNN shows that the fertility rate has been falling progressively in Brazil. In other words, Brazilian mothers are having fewer and fewer children, on average.

In recent decades, the index has already plummeted from an average of 6.16 children per woman in Brazil, in 1940, to 1.76 children per mother in the country, in the most recent data, in 2020.

In addition, Brazilian women are having children later and later. From 2000 to 2020, the proportion of birth registrations whose mothers were under 30 years old dropped from 76.1% to 62.1%. On the other hand, birth records whose mothers were 30 years old or older rose from 24.0% to 37.9%.

The lower fertility rate and the trend of late pregnancy indicate a process of demographic transition in Brazil. Until then, the country has experienced the so-called “demographic bonus”, when there are more Brazilians in the adult age group able to work – the so-called economically active population – than in the more advanced and retired ages. In the long term, the expectation is that this scenario will be reversed.

In an interview with CNN this Wednesday (12), the president of IBGE, Eduardo Rios Neto, said that expanding the population’s access to higher education is a way to postpone the impacts of the end of the demographic bonus, and still seek some economic boost in young workers.

For the economist and demographer, this question is the “key variable for the labor market until 2040”.

“For you to have a virtuosity in this moment of almost aging, which is the end of the demographic bonus, it is essential that income grows with age”, he said.

“Usually in the segments with less education, income does not vary so much by age, it is almost horizontal. You get older earning the same amount. But this occurs in the higher labor market”, he added.

Demographic bonus averted greater crisis

A study by the Instituto Brasileiro de Economia (Ibre) of Fundação Getúlio Vargas (FGV) indicated that the demographic bonus, between 1981 and 2019, contributed to a 0.9% increase in per capita income in Brazil. The economically active population contributed just over half of this growth.

However, the boost from the demographic bonus was affected by the recession from 2014 to 2016, with the aggravating economic impact caused by the Covid-19 pandemic.

“We didn’t lose as much as in the 1990s”, exemplifies the president of the IBGE, saying that, if it weren’t for the demographic bonus, the drop in Brazilian per capita income would have been “much greater”.

“If we didn’t win in the positive sense, we won in the mitigating sense. Even at that moment we had all the children in school and the quantitative coverage of education was reasonable”, points out Eduardo Rios Neto.

Teenage pregnancy drops 8.2% in 20 years

The demographer highlighted a data from the survey that he called the “deferral transition”.

“This means that many women are completing the reproductive cycle without having a child. And those who have children, be it one or two, start breeding after the age of 30”, he declared.

He points out that this phenomenon shows that teenage pregnancy is declining in Brazil.

“The rate was 21.6% in 2000, and it is already at 13.4% in 2020, according to birth records. It is still a social issue, but quantitatively it is easier to make public policy for this target audience”, he pointed out.

He indicates that most women who start having children after the age of 30 do so because they are in the job market and have higher education. “The key variable is the education of the Brazilian population”, he concluded.

In addition to the postponement of having a child, the economist highlighted what he calls a “transition in the fertility rate”.

The demographer draws attention to the fact that the process of population aging, the so-called demographic transition, occurs in practically every country in the world.

He highlights data on the fertility rate of Brazilian women. “In 2010, this rate was 1.9 children per Brazilian mother – below the house of two children”, he points out.

When the indexes point to an average of two children per woman, what demographers call a “replacement level” happens.

“If the fertility rate is maintained at this level for a long time, at some point the population will begin to have zero growth”, said Eduardo.

The president of the IBGE stated that the Institute’s projection is that the rate is currently below 1.7, and should reach 1.6 by 2030.

Reference: CNN Brasil

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