Is Divorce Good For The Economy?

When two people get married, they do not expect their relationship to end in a divorce. Unfortunately, a large portion of marriages end in divorce, but that number is dropping. The National Center for Family & Marriage Research reported that in 2015, 16.9 of every 1,000 married women received a divorce. According to the report, this number is down from 17.6 in 2014  and has decreased 25% since 1980. The locations in the United States with the highest divorce rate are Washington D.C., Wyoming, and Nevada; in that order. The states with the lowest rate of divorce are Rhode Island, Wisconsin, and Hawaii; in that order. Fun fact, Hawaii is the only state that fell under the 12 per 1,000 married women mark.

How Does Divorce and the Economy Relate?

A big debate about divorce is if it positively or negatively affects the economy.

  • Divorce slows economic growth
    • A common trend in economics is if there is an increase in households, there is a decrease in the economic growth rate. Naturally, an increase in divorce causes an increase in the number of households, an increase in the amount of power being used, an increase in the number of resources being used, etc. Therefore, an increase in the divorce rate leads to a decrease in the economic growth rate.
  • Changing family formula driving down divorce rates
    • The average divorce rate for first-time marriages is 41%. There are a number of factors that weigh into the divorce rate and how it fluctuates including age, first-time marriage, location, finances and other factors.
    • A change in the family formula means that the traditional roles of the family members are changing. An example of this is, for many households, the woman or mother is now the financial supporter. This has led to an increase in the number of dual-income families, which bring down the divorce rate. Another factor is that couples are getting married at a later age. It is believed that couples who wait to marry, are less likely to get a divorce.

What Factors Into Divorce Rates?

There is a wide variety of reason that people become unhappy in their marriage and decide to get a divorce. The following factors all play a part in any divorce:

  • Age
    • There is a direct correlation between the average age couples are getting married and the rate of divorce. According to CNBC, in 1950, the average age of men getting married was 23 years old; the average age of a woman getting married was 20 years old. Over the next 59 years, the average age of marriage has increased to 28 years old for men and 26 years old for women. The sweet spot for marriage is about 28-32 years of age.
  • Education Level
    • Education Level plays a factor in divorce. Couples who have a college degree are about 10% less likely to get a divorce. Women who completed college have a divorce rate of 14.2:1,000. The divorce rate rises to 23:1,000 when women do not finish college.
  • Location
    • Where you live when you get married has a factor in divorce rates. Nevada and Maine have the highest divorce rate, 14%. New York, New Jersey, Utah, California and North Dakota all have considerably lower rates.
  • Race
    • According to the 2014 Community Survey, the ranking of race and divorce race is as follows: Asian women, Hispanic women, white women, then black women.
  • Sexuality
    • A report came out that same-sex marriages in New Hampshire and Vermont had a lower rate of divorce than heterosexual couples. Shortly after, the Washington Post came out with an article that stated this is not true. The article also stated that the rates are the same.
  • Children
    • Usually, having children decrease the likelihood of a divorce, but having children often decreases the parents’ rate of happiness and their life satisfaction.
  • Religion
    • Religion tends to be a marriage give marriages some stability. The highest rate of divorce over all religions is Christianity which comes in at 74%. The next highest is atheist at 20%.
  • Mental Health
    • Depression and substance use disorders are both factors in increasing the divorce rate.
  • Parents’ Marital Status:
    • Basically, if your parents were divorced, you are more likely to have a marriage end in divorce. This is due to the fact that you are brought receiving messages that convey the thought that marriages and relationships are not long-term.

All of these factors can weigh into why you a couple’s relationships may end in divorce, but they are not end all be all. There are exceptions to every rule.

A common misconception is that a higher divorce rate will lead to a stronger economy. This is simply not true. Divorce rates have an inverse relationship with the economy, as they go begin to decrease, the economy will begin to rise. If you are going to get a divorce, hopefully it is mutual and you and your partner can have a collaborative divorce. Contact a divorce attorney today to find out more about your options when it comes to divorce.