Top > Business > 2007 > January > 2007-01-25

Germany Makes Plans to Increase Birthrate

The German Federal Statistical Office released a report that shows that the German birthrate has declined by 4% between 2005 and 2004, with the number of births at 690 thousand, the lowest number of German births since World War II and the lowest birthrate in Europe today. In France the birthrate in 2004 was 12.7 new born babies per one thousand citizens. In Sweden 11.2 newborns were born the same year per every one thousand citizens, while in Germany only 8.5 new citizens were born per every one thousand citizens. The German government estimates that if this rate is sustained the German population will diminish by up to 16% by the year 2050, from 82.4 million today to 69 million people, a fact that is likely to harm the economy, diminish the work force and undermine the government pension system.

Due to this demographic nightmare, the German government has decided on a plan to assist parents, in an attempt to encourage working women have children. The new "Elterngeld" (money for parents) plan, which sprung into action as of January 1 2007, allows adults, who stop working after having a child, to receive two-thirds of their net income, up until a maximum of $2,375 a month. People, making low wages may receive up to 100% of their salary. One parent may receive the benefit for up to 12 months. If the parents take turns leaving their jobs and taking care of the new born, 14 months are allowed, in an attempt to encourage fathers to pitch in.

Before this law Germany paid its parents $400 worth of benefits every month, for two years. This year due to the change in law, the sum spent on German parents is expected to grow by $1.2 billion to $5 billion annually.