19 trends reshaping economy, business

John Raidt
Foundation Scholar
Senior Fellow, Atlantic Council

Today, as ever, man seeks to comprehend the world more coherently. We aim to identify and better understand the trends shaping society so that we can better anticipate their opportunities and challenges.

For the past 20 years, the mega-trend of globalization has been the central driver of human progress—transforming society, politics, economics, and commerce. While globalization is here to stay, a wider spectrum of trends are in play that will significantly shape life in the years ahead. Offered here are a set of “catalysts” driving change in society and the economy. They are a function of markets, innovation, investment, marketing, planning, and policymaking. In many cases, the factors are inter-connected. In combination they have networked effects. The better we understand these trends and the interplay between them, the better our ability to understand their future implications. We can also better see and seize opportunity, identify and avert obstacles, and prepare for the downsides that inevitably accompany social, economic, or political change.

1. Urbanization: Mankind is flocking to cities—and with them business and opportunity—a phenomenon we are seeing in the United States and across the globe. Today, approximately 50% of the world’s population lives in urban areas by 2050 the figure will be 70%. According to McKinsey, “Today, 80% of the 2,200 large companies in emerging economies are spread across almost 100 cities; by 2025, 80% of the 7,000 large companies are likely to be spread across nearly 160 cities.”

2. Graying: As health sciences advance, individuals will live longer lives. In 1900, the average life span was 45 years. In the year 2000 it was 75 years, and by some estimates it could reach upwards of 94 years old by 2050. Individuals over the age of 65 will go from a quarter of the population today to one in three by mid-century. Aging is playing out in many developing nations.

3. Shrinking: The population of numerous developed countries and China are declining, which will impact trade, produce, and service demand. It will also have inevitable and unforeseen impacts on geo-politics.

4. Integration: Economic, social, and political life are increasingly borderless. Broadening access to transportation, immigration, and ICT connections is continuing to enhance personal reach.

5. Internationalization: Increasingly, commercial enterprises, educational institutions, and civic organizations have international footprints and multi-national identities, no longer operating under or representing a single flag.

6. Shifts in the balance of economic growth: Today the developed nations of the world mainly OECD countries account for around 60% of global GDP and developing nations account for the rest. In 20 years it will be the reverse, significantly altering patterns of demand, growth, and investment.

7. Automation: An increasing range of tasks and jobs formerly handled by human beings are being automated in the age of mechanization, computerization, artificial intelligence, and robotics? In addition, the percentage of jobs requiring technical know-how is on the rise.

8. Customization: The age of one-size fits all has been evolving into an era of customization. From the comfort of our homes, we have access to an increasingly large range of customized goods and services with features and capabilities of our individual choosing. Functions that used to be centralized, such as telecommunications, computing, printing are now in the hands of individuals. The same revolution of individualization and empowerment of people in the home is taking place in manufacturing (3D printing), energy (off-grid), home health care, home schooling, and more.

9. Digitization: Practically all information is being digitized so that it can be logged, manipulated, analyzed, shared, and used to perform an exponentially greater range of functions. Digitization has yielded the era of Big Data. The use of computers and Internet linkages to manage an increasing spectrum of societal functions, including critical infrastructure, has a broad spectrum of social, economic, commercial, legal, and security implications.

10. Virtualization: In the era of ubiquitous information and communications technology, humans increasingly interact with one another remotely. We socialize, shop, learn, collaborate, and communicate in cyberspace on broadband networks connection us from our home, at work, and on the run practically anywhere in the world.

11. Synergy: The opportunity and capability to collaborate across groups, cultures, and disciplines continues to grow exponentially.

12. Monitor-ization: ICT-connected sensors and monitors are pervasive and capable of being built into manufactured goods, public spaces, and even our bodies. There’s almost no system animal, vegetable, or mineral that can’t be monitored, tracked, analyzed, and reported, including every aspect of our lives. Part of this trend is T2T enabling “things” to communicate via the Internet to perform an expanding array of functions.

13. Harmonization: Standards, rules, and protocols are being internationalized to keep up with the pace of borderless capital, transactions, and information flow.

14. Miniaturization: A broad range of consumer products are being made smaller, lighter, faster and more capable. Cellphones the size of a shoe box are now mobile communication devices/computer devices capable fitting inside a fist, along with a growing spectrum of devices we can place on or in our bodies or imbed in our clothes. (To every trend is a counter-trend, such as the advent of the phablet.)

15. Geneti-cization: Man’s capacity to isolate, understand, and manipulate the genetic instructions for life will continue to transform health care, preventative medicine, and criminal justice.

16. Openness: Social media and ubiquity of broadband communication devices make every individual not only a channel to receive mass communications and publicity, but a vehicle to transmit into the public domain. The trend is for more and more of the data we create to be more broadly shared and accessible.

17. Mobile-ization: Mobile communication devices are enabling socializing, shopping, learning, communicating and working on the run from any place.

18. Underutilization: Global unemployment and underemployment mean a massive amount of human capital and resources capable of improving personal lives, communities, nations, regions, and the world are going underutilized, to the detriment of mankind.

19. Game-ification: An expanding array of human activities are being game-ified to add an element of entertainment and personal interaction, including learning, training, and marketing.

What other trends do you see?

What are the social, political, and economic implications of these trends, independently and in combination?

How will they change markets?

What do they mean for the future of innovation, the design and delivery of goods and services, marketing, job training, and employment?

What should the implications mean for public policymakers, small enterprise, and corporate planning?

What are the key benefits, undesirable effects, and unintended consequences?

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