Hospitals across the country have encountered a significant increase in the number of births in 2021, the likes of which has not been seen for over 10 years. Births in Australia grew by 8.8% in the March quarter of 2021, the largest quarter increase since March 1985. Additionally, the number of microbiological serologies conducted during a pregnancy completed through Medicare increased by 23.9% in 2020, indicating a considerable increase in possible pregnancies and further growth in the number of births.
‘The COVID-19 pandemic has contributed to significant lifestyle changes in terms of job redundancies, travel plans, work-life balance and much more. These changes have pushed some to reconsider family plans and accelerated the number of births,’ said IBISWorld Senior Industry Analyst Victoria Baikie.
Australia’s fertility rate has been in long-term decline, falling to 1.66 children per woman in 2019. IBISWorld expected the number of births in Australia to decline by 0.3% over the five years through 2021-22, in line with the downwards trend in fertility rates. However, a possible surge in pregnancies may provide a short-term boost to the fertility rate, and demand for associated products and services.
IVF and pregnancy services
Obstetricians and gynaecologists are expected to generate $816.1 million in revenue in 2021-22, accounting for 6.1% of the Specialist Medical Services industry. Demand for obstetricians and gynaecologists is projected to increase in 2022-23, in line with a rise in the number of pregnancies. IVF services that were initially delayed due to COVID-19 restrictions are also anticipated to resume in the current year, contributing to increased demand.
‘The fertility rate for women aged 45 and over grew by 44.4% over the five years through 2019, driven by improvements in IVF technology, supporting a gradual increase in the median age of a mother to 31.4 years in 2019,’ explained Ms Baikie.
The costs of IVF services are substantial and most of the cost is unsubsidised. In May 2021, the Victorian Government announced a $70 million investment to establish public fertility care services, boosting demand for IVF services. The investment is anticipated to help single parent and same-sex couples attain IVF services, as they are often not eligible for Medicare subsidies. Despite accounting for a small share of the industry, rising demand for IVF services is projected to support the Specialist Medical Services industry to grow at an annualised 3.7% over the five years through 2026-27.
Baby products
‘A surge in the number of births has affected demand for products targeted at infants and children. The COVID-19 pandemic has also altered the way in which these products are purchased, with online channels becoming particularly popular,’ explained Ms Baikie.
A greater share of retail products has been derived from online sales, with the Online Baby Product Sales industry expected to be worth $1.25 billion in 2021-22. A boost in the number of births will likely contribute to a 6.3% revenue increase in 2022-23. COVID-19 lockdowns and restrictions have pushed consumers to shop online for baby products that must be regularly replenished, such as nappies and baby formula.
Future impacts
The baby boom is anticipated to be short-term due to long-term declines in the fertility rate. The fertility rate is projected to remain below the replacement level of two children per woman over the next five years. Much of the increase in birth numbers is from people bringing forward baby plans and will therefore have little influence on the overall fertility rate. In addition, greater access to work and education for women across Australia will continue to put downward pressure on fertility rates.
However, trends relating to working from home and a greater emphasis on work-life balance during the COVID-19 pandemic are anticipated to support women having both children and a career. This factor, combined with improvements in IVF technology, is projected to result in demand for specialist medical services rising by 3.7% over the next five years. This increase will likely be particularly driven by demand from women aged between 40 and 49, single parents and same-sex parents.
IBISWorld reports used to develop this release:
- Specialist Medical Services in Australia
- Online Baby Product Sales in Australia
- Fertility Clinics in Australia
For more information, to obtain industry reports, or arrange an interview with an analyst, please contact:
Jason Aravanis
Strategic Media Advisor – IBISWorld Pty Ltd
Tel: 03 9906 3647
Email: mediarelations@ibisworld.com
