June is the time of year when we’re supposed to hear wedding bells. The invitations start coming in and you find yourself scurrying to order gifts from registries and block off summer weekends to attend ceremonies and parties.
Only, this year, there aren’t quite as many invitations. And next year, there will be even fewer.
According to the Pew Research Center, the American marriage rate hit a rock bottom of 50.3% in 2013, down from 50.5% the previous year. Compare that to 1960, when 72.2% of Americans married. Meanwhile, a new finding by the forecasting firm Demographic Intelligence, suggests marriage rates will continue falling into next year as Millennials choose to opt out of traditional relationships.
Marriage is going out of style and that’s a problem. An economic one.
This decline in marriage is the last thing a fragile economy needs. Historically, a rising household formation rate has contributed to America’s financial success. People meet, they marry, they buy a home, they have children and they buy more things. One new household adds an estimated $145,000 to the U.S. economy thanks to the ripple effect of construction spending, home improvements and repairs.
That ripple effect is disappearing as Millennials increasingly chose to live at home. In 2012, 45% of 18- to 30-year-olds lived with older family members, up from 39% in 1990 and 35% in 1980. The Atlanta Fed says, “The decline in household formations is the main reason why the housing industry did not play its traditional role of driving the economic recovery.”
Marriage and family also provides a sense of stability that encourages prosperity — especially for men. According to an American Enterprise Institute study by economists Robert Lerman and Brad Wilcox, young married men, ages 28-30 make, on average, $15,900 more than their single peers, while married men ages 33-46 make $18,800 more than unmarried men.
In a world of online dating and hook up apps like Tinder, where singles can browse pictures of nearby people they want to meet, society and government alike no longer seem to place as much value on the institution of marriage. Indeed, 41% of babies born today are born to single mothers — that’s 2.5 times as high as reported in 1980 and 19 times as high as in 1940. Americans are also having far fewer children — nearly half of child-bearing age women did not have kids in 2014, the most since the U.S. Census Bureau began tracking this stat in 1976.
While there are plenty of reasons for individuals to fear marriage — the poor job market, rising housing costs and high divorce rates, the U.S. government is doing its fair share to compound the problem, discouraging people from marrying through misguided, outdated and senseless tax policy.
Working couples tying the knot this June will get hit with a higher tax bill come April 15 because two incomes often put a married couple in a higher tax bracket than they’d be in as individuals living together. Add to that advantages single parents have in taking standard deductions for children and phaseouts for tax benefits that kick in at lower limits for couples than they do individuals and you have a tax policy that hardly encourages marriage.
Marriage may not be for everyone but the statistics tend to prove that it’s a strong predictor of healthier lives for the couples themselves and for their children especially. It’s also a better path to financial well-being and good for the overall economic health of the country. Bizarrely, our government’s tax policy has done nothing to encourage marriage and everything to discourage it. At the very least, economic policy should not penalize people for marriage.
It’s time for Washington to step up to the plate and do away with marriage penalties. And it’s time for couples — when and if they meet the right person — to start saying “I do.”
Image credit Stuart Beard/Flickr
Article via USA Today