“In a new report, economists writing for the Brookings Institution estimate that the United States could see “on the order of 300,000 to 500,000 fewer births next year” as a result of the economic recession triggered by the novel coronavirus.” – Washington Post
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I have been anticipating a drop in the birthrate as a result of Coronavirus, but I was not ready for this Washington Post headline: “Covid baby bust’ could lead to half a million fewer births next year.”
Here is how the article by Christopher Ingraham puts it: “In a new report, economists writing for the Brookings Institution estimate that the United States could see “on the order of 300,000 to 500,000 fewer births next year” as a result of the economic recession triggered by the novel coronavirus.”
I checked and according to Statista, there were 3.79 million babies born in 2018. 500,000 births represents roughly 13% of that figure. That is a significant percentage loss in the number of potential child end-users for the toy industry starting in 2022.
Why the decline? You would think that people, shut in together at home without anything else to do would become more amorous. It seems that the presence of sickness and job loss have a deadening effect on our desire to procreate.
According to the article, the Brookings institution used data from the 1918 flu epidemic and the more recent Great Recession to determine the population curve. In both cases there was a significant decline in births. The difference this time, however, is that we are experiencing an economic decline in the midst of a pandemic.
The article notes that after the flu epidemic, women were not increasing their households in order to make up for the children that were not born. It was a permanent drop in births that was never made up in subsequent years.
If the Brookings Insitution is correct in their predictions, we should anticipate a sharp drop off in our child end-user base that will last a decade. What will begin next years with a dip in the number of preschoolers will continue to have an impact until these children age out as tweens.
We, as an industry, have a lot on our plate right now. Never-the-less, we can’t ignore what is coming. Now is the time to start planning for how to manage our way through a potential significant drop in toy consumption.
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