Recession affects Birth rates as well as death rates
It is an undeniable fact that in a recession, parents seem to take on board the economic environment and postpone having babies until financial circumstances improve. In America for instance, statistics show that the country’s birth rate dropped by 2% in 2008- the worst decline in four decades.
However, recent figures from the UK Government Office for National Statisitics, published on 30th november 2009, also point to the fact that company births have been impacted by the recession. In 2008, new company start ups fell 3.7% compared to 2007. ( down from 281, 000 to 270, 000). Mind you, these figures shouldn’t come as much of a surprise. Many entrepreneurs act very much like “wannabe parents” in as much as if they think the economic conditions are not right to help their “babies” develop healthily through the early years, they are very likely to delay the birth until favourable conditions return.
Quite understandably, economic commentators concentrate very heavily on insolvency stats during a recession to see how bad things might be; what I’m saying is that there is another side to the coin. When company start up numbers begin to climb again, it will be a sure sign that on the ground, optimism among business people is on the up again.