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October 08, 2020

Singapore to offer baby bonus to combat potential coronavirus fertility slump

Singapore to offer baby bonus to combat potential coronavirus fertility slump

The Singapore government has announced a series of measures to support households in recovering from the Covid-19 pandemic, including economic support for those who may have postponed having children due to economic and health uncertainty.

Deputy Prime Minister Heng Swee Keat acknowledged that the “path to recovery [from the pandemic] will not be easy.” He said that alongside managing healthcare issues, the government needs to manage the economic and social consequences of the virus that are affecting businesses, workers, and households.  

As a result, to help new families with expenses during this period, Heng Swee Keat announced there will be a one-off payment for newborns. This will be provided on top of current baby-related benefits that are worth up to $10,000 Singapore dollars (£5,700).

The city state has one of the lowest birth rates in the world—1.1 births per woman in 2018—and the government is keen to improve fertility rates. However, while Singapore expects Covid-19 will cause a drop in its birth rate, other countries in south-east Asia are preparing for a post-pandemic baby boom as the virus has reduced access to contraceptive health care.

Elizabeth Brainerd has written for IZA World of Labor about whether government policies can reverse undesirable declines in fertility. She warns that “sustained periods of very low total fertility will radically shrink populations: long-term fertility rates at or below 1.3 children per woman will reduce a country’s population by half in less than 45 years.”

But, what, if anything, can governments do to stop or reverse the decline? 

Brainerd says that well-crafted pronatalist policies appear to change not only the timing of births but, more importantly, the probability of having a child as well. “However,” she warns, “these policies are unlikely to offset the impacts of broader social and economic changes on women’s fertility decisions, such as expanding economic opportunities and changes in incentives for investing in education. These changes appear to have a more profound impact on fertility and family formation than government policies.”

Read more from IZA World of Labor about the Covid-19 pandemic.