Report

The long-term employment challenge – The productivity solution

Global employment growth has been slowing for more than two decades. By around 2050, our research finds, the global number of employees is likely to peak. In fact, employee headcounts are already declining in Germany, Italy, Japan, and Russia; in China and South Korea, they are likely to begin falling as early as 2024. While there is significant scope for policies that boost labor-market participation among women, young people, and those over the age of 65, that will be far from easy. Employment growth could double, to 0.6 percent, in the countries we studied: the G19 (the G20 without the European Union as a composite member) plus Nigeria—economies that account for 63 percent of the world’s population and 80 percent of global GDP. But that will happen only if each gender and age group, throughout these countries, closes the employment gap with the high-performing economies. In any case, even a doubling of employment growth won’t fully counter the erosion of the labor pool.

Capture d’écran 2015-01-16 à 12.19.03

So productivity growth must drive the expansion of GDP in the longer term. Indeed, it would have to reach 3.3 percent a year—80 percent faster than its average rate during the past half century—to compensate fully for slower employment growth. Is this possible? Actually, our case studies of five sectors (agriculture, automotive, food processing, healthcare, and retailing) found scope to boost annual productivity growth as high as 4 percent, more than enough to counter demographic trends.

The productivity solution

The world isn’t running out of technological potential for growth. But achieving the increase in productivity required to revitalize the global economy will force business owners, managers, and workers to innovate by adopting new approaches that improve the way they operate.

Our study found that about three-quarters of the potential productivity growth comes from the broader adoption of existing best practices, or catch-up improvements. The remaining one-quarter—counting only what we can foresee—comes from technological, operational, or business innovations that go beyond today’s best practices and push the frontier of the world’s GDP potential. Efforts to improve the traditionally weak productivity performance of the large and growing government and healthcare sectors around the world will be particularly important.

Chosen excerpts by Job Market Monitor. Read the whole story at  Can long-term global growth be saved? | McKinsey & Company.

Related Posts

The Demography of Largest Countries 2010–50 in a Figure

Source: THE UNITED STATES AFTER THE GREAT RECESSION:  THE CHALLENGE OF SUSTAINABLE GROWTH

China | Demography | Aging : the long-term implications

Canada and Europe are not alone in dealing with important demographic shifts. And worries about increasing recruitment problems, workforce shortages and skills gap are widespread. But there might be more critical situations. For instance, China is just beginning its huge demographic transition. In an article published on brookings.edu, Wan Feng qualifies China as a “demographic overachiever” and analyses … Continue reading 

Highly-Skilled Migration in US – LinkedIn data show a decrease, from 2000 to 2012, in the percentage of professional migrants, worldwide

There is a large body of literature, mainly in the disciplines of sociology, demography, economics, and geography, about international migration, and, more specifically, highly-skilled migration. It is beyond the scope of this article to discuss theories of migration and the rich and healthy debate about them. With this article we emphasize an outstanding problem in … Continue reading 

Population aging could have effects that are positive study says

In this paper, we addressed the important question of how selected areas of life will be affected as populations grow older and smaller. We used the case of Germany, a country that is at a relatively advanced stage of the demographic transition, to study the potential long-run implications of population aging. In the decades prior … Continue reading 

Graying World – There will be 13 ‘super-aged’ nations by 2020

The world is graying at a break-neck pace and that’s bad news for the global economy. By 2020, 13 countries will be “super-aged” — with more than 20% of the population over 65 — according to a report by Moody’s Investor Service. That number will rise to 34 nations by 2030. Only three qualify now: … Continue reading 

Discussion

Trackbacks/Pingbacks

  1. Pingback: The Aging Global Workforce – The productivity challenge could be do-able McKinsey finds | Job Market Monitor - January 29, 2015

  2. Pingback: Job Market Monitor - May 25, 2017

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Jobs – Offres d’emploi – US & Canada (Eng. & Fr.)

The Most Popular Job Search Tools

Even More Objectives Statements to customize

Cover Letters – Tools, Tips and Free Cover Letter Templates for Microsoft Office

Follow Job Market Monitor on WordPress.com

Enter your email address to follow this blog and receive notifications of new posts by email.

Follow Job Market Monitor via Twitter

Categories

Archives

%d bloggers like this: