Britain has entered a birth rate crisis

Few will notice, yet this year England and Wales are almost certainly going to cross a remarkable threshold: the number of deaths will exceed the number of births. In the year to mid 2023 – figures for which have been published today by the Office of National Statistics (ONS) – there were 598,400 births and 598,000 deaths. Given the long-term downward trends in births, and the lag in the figures being published, we have almost certainly arrived at the point of negative natural population growth – a condition which has not properly afflicted Britain since the Industrial Revolution. Across the whole of the UK, deaths did narrowly outnumber births in the pandemic year of 2020, but other than that the only period over the past century in which that happened was between 1976 and 1978, after the end of the post-war baby boom. The world wars themselves did not reverse the natural growth of the population.

The end of natural growth in the population has been masked, however, thanks to high levels of migration. Indeed, the ONS itself chose to lead its press release with the figure that the population of England and Wales grew by a net 610,000 in the year to mid-2023. That growth is almost entirely down to net migration. If we were to eliminate net migration – which was Reform UK policy in the election – we would be on the verge of a falling population.

High levels of migration also mask our lousy economic performance. With net migration of 610,000 we would need GDP growth of nearly 1 per cent just to stand still. Yet in the year to the first quarter of 2024 the economy of the UK (the ONS net migration figures are for England and Wales rather than the whole of the UK) economic growth was just 0.3 per cent. In terms of GDP per head, in other words, economic growth is negative. Per capita we are in recession. So much for the argument that migration boosts the economy; it isn’t obviously doing much for our economic performance at the moment.

Negative per capita growth in the economy should come as no surprise if you look at another set of statistics released by the ONS today, which show that productivity in the public services fell by 0.6 per cent in the 12 months to the first quarter of this year. Not only has productivity in the public services failed to recover from the pandemic, it remains lower than it was when Tony Blair came to power 27 years ago. This is all the more astonishing when you consider the opportunities which the public sector has had to improve productivity in that time, through the internet, AI and so on. 

It is a reminder of the stupor into which the UK economy has fallen, and just how far we have to go before Keir Starmer’s government can claim to have realised its ambition of growing the economy. Without per-capita economic growth we cannot have any sustained rise in real earnings. That was a point which Jim Callaghan repeatedly made when he was prime minister in the 1970s, telling workers that pay rises would have to be paid for by productivity growth. Whether Starmer will be brave enough to tell that to public sector unions is another matter.