The National Center for Health Statistics (NCHS) reports that the US birth rate has continued to decline in 2018. But now, the birth rate is the lowest it has been in 32 years. It fell 2% from 2017 to 2018. The fertility rate, the total number of children a woman is likely to have over the course of her lifetime, declined by 2% as well. Both rates have steadily declined over the past decade.
The declining birth rate is still surpassing the death rate in the US, so there is still population growth happening. Which is a good thing for the economy. But, if the birth rate continues to decline, what does that mean for HR and the workforce? We’re already in the midst of a workforce shortage crisis, with the current demand for skilled labor not being met.
There are a few things to consider for the future…
The Rise of AI and Automation
Robots taking over jobs might actually be a good thing. It will mean fewer jobs will need to be filled by a workforce that may not exist in just a decade or two. Companies are already hiring fewer employees as automation and artificial intelligence (AI) grow. Like in the high-tech warehouses at Amazon or with managing mutual funds and assets on Wall Street.
But this doesn’t mean there still won’t be jobs to fill. We just need to focus on making sure the talent we do have is trained for the new jobs. There will definitely be a bigger need for computer skills to keep up with the new technology. Also, high-touch jobs in healthcare will also continue to grow as our largest generation, Baby Boomers, age out of the workforce.
Strategic Workforce Planning
Fertility rates overall are continuing to decline, but not consistently across all states. South Dakota and Utah were still able to meet what is considered the replacement rate. That means both states were able to maintain their current populations. Its a striking contrast to the decline occurring in coastal cities.
Understanding birth and fertility rates by region are beneficial to your strategic workforce planning by giving you a chance to be proactive. You should consider the challenges you will face in certain regions. Especially in areas where people are aging out of the workforce but there’s not enough talent to replace them.
Some states have even begun to offer unique relocation perks to attract talent to their areas. Vermont is offering up to $10,000 for remote workers to move there in 2019. Maine has been offering to help pay your student loans since 2008 if you choose to move there. Both states have high median ages and are attempting to attract younger talent. You may want to consider remote workers, relocation benefits, and unique perks as possible tools in your strategic workforce planning.
Building Up Your Diversity and Inclusion Initiatives
The NCHS report goes even further to break down the data by ethnicity. These reports showed that Hispanic and black women actually surpassed the replacement rate in 29 and 12 states, respectively. White women did not meet the rate in any state.
Consider bolstering your diversity and inclusion initiatives. We all know the benefits of having a diverse workforce, but we need to ensure our organizations are making people feel included. If your employer brand reflects a culture where people of color don’t feel supported and comfortable, you may have a problem even attracting talent to fill your roles in the future. Just looking at the NCHS reports, there’s going to be less white people in the labor market.
We should also look to support more inclusive immigration policies. Current immigration policies already have an impact on certain US industries, like agriculture. A more streamlined process for immigration that encourages workers to work and pay taxes, could be the answer. Especially for those concerned that the decreasing birth rates will create economic issues down the line.
HR has a duty to be a strategic business partner to its organization.
To be the most effective business partner, HR needs to monitor trends that impact the workforce. It will help you provide the best recommendations to ensure the organization’s strategic goals are met. If your HR analytics maturity is at level 4, the declining birth rates can even be worked into your models and forecasting. This type of strategic guidance is what makes HR a valued member of the senior leadership team.
Declining birth rates are an external trend that strategic HR business partners should watch. But there are trends within their own organization’s workforce data that should be watched too. An HR dashboard can make it easy to track and manage those trends. It automatically creates visualizations for your workforce data based on your metrics. You can easily identify trends and patterns so you can focus on analytics and solutions.