I'm not talking solely about births (didn't even mention the birth rate), I'm saying for mental health/general thriving of society too.

Kids raised in married 2 parent households are less likely to end up homeless, achieve better academically and earn more, have less depression/suicide rates etc. Literally every outcome is better for stable 2 parent homes. The decline of the 2 parent nuclear family means more kids will suffer.

I don't really understand why it has to be either or. You can have your population decline if you want, but why does that have to mean single parent homes?

Can't you raise your 1 or 2 kids in the context of marriage to give them a higher chance of a better outcome, and still have your population decline?