Europe’s Fertility Crisis: Can We Pay The Way Out Of It?

Europe is facing a quiet yet profound crisis. Fertility rates across the EU have remained below replacement level for decades, with the average woman having around 1.5 children.

In countries such as Italy, Spain and Malta, the rate is even lower, hovering near 1.1.

During last Monday’s Budget 2026, the government announced a number of tax cuts for parents who have children, with tax cuts increasing depending on how many children a couple have.

Married couples with one child will see their tax-free income threshold rise from €15,000 to €22,500 over three years.

Larger families will receive the most substantial relief. Married couples with two or more children will see their tax-free threshold rise from €15,000 to €37,000, saving up to €6,000 annually.

Malta Daily asked Professor Stephanie Fabri, an economist and lecturer at the University of Malta, specialising in entrepreneurship, strategic management and public policy.

“Europe’s fertility crisis is not about convincing people to have children, it’s about creating an economy where they can”, she told Malta Daily.

She went on to propose a number of things that studies show work at addressing the fertility crisis:

1. Universal childcare

Make childcare affordable and accessible to help parents, especially mothers, stay in work and balance family life.

2. Equal parental leave

Provide gender-neutral, use-it-or-lose-it parental leave so fathers share caregiving and mothers face fewer career setbacks.

3. Secure housing and jobs

Tackle high housing costs and unstable employment so young people can plan families with confidence.

4. Support for dual earners

Reform taxes and work structures to encourage both parents to work, with flexible and predictable schedules.

5. Fertility and health access

Ensure affordable access to reproductive healthcare, fertility treatment and education about family planning.

6. Gender equality at home and work

Promote shared domestic roles and equal opportunities, as equality supports higher birth rates.

7. Education and innovation

Invest in skills, research and technology to strengthen productivity and offset population decline.

#MaltaDaily

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