Many fall into a fertility “trap”, having fewer children than they planned because they postpone starting a family until too late in life.

A report by the Institute for Public Policy Research (IPPR), a think tank with close links to Labour, quantifies the trade-off faced by many women as they juggle the financial implications of bringing up children.

A woman working in administration or a nursery school, for example, who delays her first child from 24 to the age of 28 saves £400,000 in lost earnings over her career, according to the report, Population Politics.

However, there is a penalty for women who delay childbearing. The report says: “Many of those who participate in higher education and/or establish their careers before having children face higher risks of infertility and do not have as many children as they originally aspired to. This means that fewer children are born to parents who are relatively affluent.”

By contrast, women who have children while they are young can be caught in a “fertility” poverty trap. Low-skilled women forfeit more than half of their potential income if they have two children.

The effect, according to the authors, has been to exacerbate the ageing of society. The report states: “If people were able to have the number of children that they planned for and aspired to at age 21-23, there would be 13% more children every year in Britain and the fertility rate would be well above replacement levels of 2.1.”

Nick Pearce, director of the IPPR, said: “Britain is now at a demographic fork in the road and in danger of taking the wrong direction. Although our population is rising, a fall in fertility would have serious long-term consequences — it would make it harder to earn our way in the world and to pay for valued public services.”

Pearce, who is urging the government to create a minister for demography and better childcare to enable families to combine work and family life more easily, added: “Fertility patterns can take up to 40 years to change so politicians need to start taking action now.”

The report says boosting immigration to the levels required to fill the gap is not politically viable. “According to estimates from the United Nations, maintaining current support ratios in the UK [between those in employment and dependants aged over 64] would require 59.8m migrants between 1995 and 2050, an annual average of slightly over 1m immigrants.”

The researchers, Mike Dixon and Julia Margo, examined the general household survey of 1982-84, in which 1,108 women in their early twenties predicted they would have 2.25 children. But the average family size for those women, now in their forties, is 2.02, meaning 92,000 predicted babies were never born. The report says the gap is significant, even if changes in women’s aspirations are taken into account.

The average age at which women have their first child has risen from 23.7 in 1971 to 27.1 in 2004, according to official statistics. One in five women remains childless compared with one in 10 a generation ago.

Stella Hards from Bristol delayed starting a family to concentrate on her career in insurance. Although she dreamt of having at least three children, she is now, at 41, still trying for her first baby with her husband Reda, 26, a caravan outfitter.

“Whenever a relationship started getting serious I would back away as I just didn’t feel ready to settle down. I was too busy enjoying life,” Hards said.

From 35 she realised she had to concentrate on having children, but had two miscarriages. “I know my dream of having three children is very unlikely to become a reality and that is hard to take. I never imagined how difficult it would be to have a baby,” she said.

Women who start their families in their early twenties suffer the financial consequences. Bethan Thomas, 32, from Llanmaes, South Glamorgan, had Elinor, the first of her three children, at 22.

She had studied economics and management studies at university and planned to go into finance, but said: “It didn’t work out that way.” She added: “Economically it doesn’t make sense and your life changes a lot but it’s the best thing you can ever do as well. I don’t regret not working as I have a wonderful family.”

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