ANU MADGAVKAR MAY 2017 - GlobeWomen McKinsey & Company 5 1 CE 1000 2025 2010 1990 2000 1940 1913 1980

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  • Global Summit of Women

    Global megatrends: A fast-forward view

    CONFIDENTIAL AND PROPRIETARY

    Any use of this material without specific permission of McKinsey & Company is strictly prohibited

    ANU MADGAVKAR

    MAY 2017

  • 2McKinsey & Company

    Four disruptive forces are changing the world

    An aging world Shifting economic weight

    Greater inequalityDisruptive technologies

  • 3McKinsey & Company

    Two imperatives for the world – productivity growth and employment growth!

    SOURCE: The Conference Board Total Economy Database; UN Population Division; McKinsey Global Institute analysis

    NOTE: Numbers may not sum due to rounding.

    1.8

    1.8 1.7

    Productivity

    growth

    Employment

    growth

    Past 50 years Next 50 years

    at historical

    productivity growth

    2.1

    3.5

    0.3

    -40%

    GDP of G19 and Nigeria

    Compound annual growth rate, %

    By 2040,

    1 in 4 people in advanced

    economies and China

    will be 65+

  • 4McKinsey & Company

    Full-potential scenario

    $28 trillion

    Workforce participation matters - tackling the global gender gap at work is worth a lot!

    SOURCE: McKinsey Global Institute analysis

    ~60% from workforce participation

    ~20% from mix of part-time and full-time

    ~20% from sector mix and productivity

    Best-in-region scenario

    $12 trillion

    11% increase in global GDP if every country

    achieved the fastest rate of progress in its

    region on three key gender gaps

  • 5McKinsey & Company

    1 CE

    1000

    2025

    2010

    2000 1990

    1940

    1913

    1980

    1820

    1950

    1960

    1970

    1500

    Earth’s economic center of gravity

    The economic center of gravity is shifting east and south at an unprecedented speed

    SOURCE: Angus Maddison; University of Groningen; McKinsey Global Institute analysis

  • 6McKinsey & Company

    Meanwhile, unprecedented progress on automation, AI and analytics is underway

    Can boost innovation,

    transformation, productivity

    Can solve “moonshot” challenges

  • 7McKinsey & Company

    Automation is not a distant future concept

    SOURCE: O*Net 2014 database; McKinsey analysis

    400 120 0

    20

    20

    60 80 100

    60

    100

    80

    40

    Hourly wage

    $ per hour

    Ability to technically automate

    Percentage of time on activities that can be automated by adapting currently demonstrated technology

    1 Our analysis used “detailed work activities”, as defined by O*NET, a program sponsored by the US Department of Labor, Employment and Training Administration

    2 Using a linear model, we fine the correlation between wages and automatability in the US economy to be significant (p-value

  • 8McKinsey & Company

    Those who felt their

    incomes were not

    advancing and were not

    hopeful about the future

    were

    1.6-2.0x more likely to be opponents

    of foreign trade and

    immigration3

    SOURCE: INSEE; Bank of Italy; CBS; Statistics Sweden; ONS; CBO; McKinsey Global Institute analysis

    A large share of households in advanced economies are seeing flat or falling incomes

    % of households in income segments with flat or falling income, 2005 - 141

    20

    63

    70

    70

    81

    97

    France

    United States

    Italy

    Weighted average2 65–70

    Sweden

    Netherlands

    United Kingdom

    1 For each country we use the latest year the data are available—France (2012), Italy (2014 disposable incomes, 2012 market incomes), the Netherlands (2014), Sweden (2013), United Kingdom (2014), United States (2013).

    2 Population-weighted average of 25 countries extrapolated from six country deep dives.

    3 Based on a survey of individuals in the US, UK and France

    Market income

  • 9McKinsey & Company

    Some implications for business leaders

    Take a long term view

    Rethink work and the organization

    Make capital allocations adaptive

    Engage successfully with society

  • Global Summit of Women

    Global megatrends: A fast-forward view

    CONFIDENTIAL AND PROPRIETARY

    Any use of this material without specific permission of McKinsey & Company is strictly prohibited

    ANU MADGAVKAR

    MAY 2017