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
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Four disruptive forces are changing the world
An aging world Shifting economic weight
Greater inequalityDisruptive technologies
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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
1.81.7
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+
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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
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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
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Meanwhile, unprecedented progress on automation, AI and analytics is underway
Can boost innovation,
transformation, productivity
Can solve “moonshot” challenges
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Automation is not a distant future concept
SOURCE: O*Net 2014 database; McKinsey analysis
400 1200
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 <0.01), but with a high degree of variability (r2 = 0.19)
File
clerks
Chief
executives
Landscaping
and grounds-
keeping workers
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Those who felt their
incomes were not
advancing and were not
hopeful about the future
were
1.6-2.0xmore 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
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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
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