Short- and long-term effects of unemployment on fertility

Fertility falls when unemployment rises, but there may be no long-run effect if women simply postpone childbearing. We analyze the effects of unemployment by following fixed cohorts of US-born women defined by their own state and year of birth. We find that a one percentage point increase in the unemployment rate experienced between the ages of 20 and 24 reduces the short-run fertility of women in this age range by six conceptions per 1,000 women. When these women are followed to age 40, a one percentage point increase in the unemployment rate experienced at 20 to 24 is associated with an overall loss of 14.2 conceptions. This larger long-term effect is driven largely by women who remain childless.