How employers can accommodate a surprising baby boom

This article was originally published in Forbes on 20 October 2022.

The baby bust once attributed to the pandemic is actually a baby boom, a new report shows.

While economists predicted that the pandemic would accelerate a declining birth rate — to the tune of 300,000 to 500,000 children — that fear didn’t materialize. Instead, there was a 6.2% increase in the birth rate last year for U.S. mothers relative to the 2015 – 2019 trendline. This amounts to a net increase of births of 46,000 children.

One working theory? Hybrid working created the right conditions to encourage and enable working parents to start families. Working from home may have helped alleviate common concerns such as childcare, commuting and time available to spend with a growing family.

Birth rates usually drop in recessions — but that didn't happen this time

It makes sense that people don't want to have babies when times are tough. For example, birth rates dropped precipitously during the 2007 Great Recession. This current baby bump is the first major reversal in the declining fertility rates that we've seen since. Given the predicted upcoming recession — Goldman Sachs Chief Executive Officer David Solomon recently told Reuters that there is a “reasonable chance” of one — what other changes might this drive? How can workplaces prepare for the unexpected impacts to their people?

Understanding “spillover effects” — and what that means for the workplace

Smart businesses will predict and adapt to changes in an uncertain world. But they need to take that a step further and anticipate what the next effect or impact of any one behavior or environmental driver might be. After all, no behavior sits in a vacuum. In behavioral science, this is known as a "spillover effect."

If flexible working has, in part, led to this baby boom, what's the next logical step? A higher demand for flexibility? More requests for time off, or onsite child care when attendance in the office is mandatory? Companies would do well to consider these ripple effects.

Flexible workplaces need strong parental leave policies

Flexible working was a driver in a specific subset of women choosing to start families, namely college-educated women and women aged 30-34, who saw a drastic reduction in the opportunity cost of having a baby. Businesses need to take a hard look at how their flexible work policies attract talent. And, more importantly, how these policies work together with parental leave policies to create an attractive package.