The United States recorded its lowest-ever total fertility rate last year. Nicholas Eberstadt, a senior fellow at the American Enterprise Institute (AEI), raised the question in a recent report of whether "a depopulating America can continue to prosper in the future." His warning is that the painful changes brought by population decline could arrive with great speed. Some have already become reality. The education sector is being hit by low birth rates and the contraction of legal immigration. Economist Tyler Cowen pointed out that the decline in the college-age population will accelerate this crisis. Indeed, since 2013, more than 700 U.S. colleges — about 15% of the total — have already closed. The Congressional Budget Office (CBO) projects that the United States will enter a society of "permanent net mortality," with deaths exceeding births, in four years, and that by 2046 deaths will exceed births by one million. While immigration inflows would delay the onset of population decline until 2056, the population growth rate from 2037 to 2056 would be just 0.1%.
A depopulating America will grow increasingly frail. In just three years, the population aged 65 and over is expected to surpass the number of minors under 18. The fastest-growing "super-elderly" population of those aged 80 and over is projected to more than double by 2050. For decades, longer lifespans drove global prosperity, and prosperity in turn supported longer lifespans. The world's population, 3.5 billion in 1968, has surpassed 8 billion, and life expectancy has risen from 56 to 74.
Population growth means more consumers, workers, taxpayers and investors. The long-term population decline accompanying the extension of life expectancy among the elderly will inevitably demand longer working lives. This is the way to prevent the worsening ratio of retirees to working-age population that threatens social welfare systems such as health insurance. The U.S. labor force participation rate is currently lower than Europe's. If the current participation rate had been maintained at its 20th-century peak level of 1998, the labor force would be 5 million larger.
The reason this problem is not easily solved is that it is intertwined with complex social pathologies such as crime and excessive dependence on government. Eberstadt offered the analysis that "25 million people, or one in seven adult men, have a felony record." Dependence on government is also sapping the motivation to work. Eberstadt pointed out that "as of 2024, about a quarter of prime-age men with no dependent children belong to households receiving at least one means-tested welfare benefit," adding that "this is three times the rate of 1985." Moreover, disability benefits are remarkably widespread among prime-age men who are neither working nor looking for work. Population aging lowers the savings rate, which leads to reduced investment and declining productivity. This poses a fatal threat to the 36 million U.S. households with net worth of less than $25,000 as of 2023. Included among them are 40% of Hispanic households and nearly half of Black households.
A society with a declining population can never prosper. But there is one hopeful solution: increasing the inflow of skilled immigrants. The United States is an exceptionally good country at transforming newly arrived immigrants into loyal and productive citizens.
