The United Kingdom is on the cusp of a profound demographic shift, with a leading think tank predicting that deaths will begin to consistently outnumber births from around 2026. This pivotal moment, not witnessed for over a century, signals the start of a "new era" for the country's population structure.
The Numbers Behind the Shift
This historic turning point is driven by two powerful and converging trends. Firstly, fertility rates have plummeted to record lows. In 2024, the rate in England and Wales fell to just 1.4 children per woman, representing the steepest decline of any G7 nation. Surveys indicate that financial pressures are a primary cause, with nearly half of British adults delaying or deciding against having children due to money concerns.
Secondly, while the UK has historically relied on immigration to bolster its population and workforce, recent official data shows that net migration has halved. This reduction is attributed to fewer people arriving for work and study, tightening the demographic squeeze from both ends.
Implications for the Workforce and Public Finances
The combined effect of an ageing population, fewer births, and reduced immigration presents significant economic challenges. A central concern is the shrinking proportion of working-age adults. This demographic group is crucial for driving economic growth and funding public services through taxation.
With fewer people in employment supporting a growing retired population, analysts warn of intense pressure on the Treasury. To maintain current levels of spending on services like the NHS and state pensions, the government may have to consider raising taxes to compensate for the narrowing tax base.
A New Reliance on Immigration
The projected demographic shift underscores the nation's increasing dependence on international migration to sustain any population growth. Without a steady flow of immigrants, the UK's overall population could begin to decline sooner than previously anticipated, exacerbating the strain on the economy and public finances.
This new reality sets the stage for complex policy debates in the coming years, balancing immigration controls with the stark economic necessities dictated by an ageing society.
