The world could see more disruption in the coming decade than at any time over the last 60 years, a leading management consulting firm is predicting. Bain and Company says demographics, automation and inequality will combine to create increasing extremes in the economy and “have the potential to dramatically reshape our world in the 2020s and beyond.”
While change can be painful, it also provides new opportunities. Increased productivity for automation could fuel an economic boom, and properly managing the change can give less-skilled workers the time they need to adjust.
“The analysis and business insights in this report can help leaders put these changes in context and consider the effects they will have on their companies, their industries and the global economy,” Bain’s says.
As the report by the company’s Macro Trends Group sees it:
- the total size of the labor force will continue to stagnate or decline, which will slow economic growth;
- the next phase of automation will accelerate to address the growing labor shortage, eliminating as many as 25 percent of current jobs; and
- highly skilled workers (about one-fifth of the workforce) will see their incomes rise even faster, increasing income inequality.
As a result, Bain and Company expects the 2020s to bring about:
- a potentially rapid increase in interest rates, which will then drop back toward historical lows;
- a 10- to 15-year economic boom driven by automation;
- a peak in the growth of baby-boomer spending;
- increased government taxes and regulation to address income inequality; and
- an increasingly small pool of highly skilled, high-income workers.
“We call the coming period of upheaval ‘the Great Transformation’ and define it through 10 interlocking themes, including the changing ages and stages of life, the rise of platforms and post-globalization in geopolitics. Our research indicates that the depth and breadth of changes in the 2020s will set apart this transformation from many previous ones.”