Demographers have been for some time observing an upward trend in fertility rates, often referred to as 'the baby bounce'.

Now, it seems it is offiicial. Australia is in the midst of a baby boom according to a new report from the Producivity Commission and family benefits like the baby bonus only played a ‘modest part’.

Births in Australia are at an historical high with around 285 000 babies born in 2007. This corresponds to an estimated total fertility rate of 1.93 babies per woman, the highest since the early 1980s.

According to the report, this is not a one-off event as fertility rates have been generally rising for the last six years. Overall, the evidence suggests that after its long downward trend after the Second World War, Australia's fertility rate may have stabilised at around 1.75 to 1.9 babies per woman.

The report says that much of the increase reflects that over the last few decades, younger women postponed childbearing and many are now having these postponed babies (so-called 'recuperation').

Other reasons behind the fertility rates include buoyant economic conditions and greater access to part-time jobs which have reduced the financial risks associated with childbearing and lowered the costs associated with exiting and re-entering the labour market.

“With more flexible work arrangements, women today are more able to combine participation in the labour force with childrearing roles<” the report says.

The report says “a recent increase in the generosity of family benefits (such as family tax benefit A and the 'baby bonus'), though not targeted at fertility, is also likely to have played a part”.

However, that role has probably only been a modest one it said.

Rather than affecting fertility rate, family policies are more powerful in providing income support, improving child and parental welfare, and serving other social goals it said.

The paper is available online here.