A decade has passed since PwC, in 2013, in a study entitled “What’s driving the future?”, identified five deep, global, long-term megatrends that would affect us all and have since transformed the world at a faster rate than anticipated.
Since that 2013, these megatrends have evolved and the way in which they manifest themselves today is different. For this reason, PwC re-examined these findings to understand how they have changed, what future they can create in 2030, how they can unfold and what challenges they will pose to humanity.
The five “megatrends” are:
- And climate change
- E Technological disruption
- And demographic changes
- And Fractured World
- and social instability
As humanity seeks to reduce carbon emissions, levels in the atmosphere are worsening, temperatures and weather events are becoming extreme and more frequent. The consequences that it brings to people are varied, but can be summed up as loss of homes, increased cost of living and also health risks. On the other hand, companies will have to face negative effects, insecurity of resources and increased costs, interruption of the supply chain, so they will have to strive to create employment through investments in climate technology. Meanwhile, states will face risks of financial crises, threats to world food security and agricultural exports, mass migration and new economic dependencies.
Most of the world now recognizes the severity of the climate crisis and is increasing their share of renewable energy production, and in parallel, more and more organizations are seeking net-zero emission commitments. But the transition to a carbon neutral economy will not be easy, so the world is racing against time.
Technology transforms our way of relating to the world and changes the way we understand humanity. On the one hand, it allows for great value creation, but it also brings consequences that are and will be increasingly difficult to mitigate.
Against this backdrop, individuals will need to significantly increase their capabilities while expecting massive work interruptions, loss of privacy, increased misinformation, and increasing mental health problems. On the other hand, in organizations there will be competitive differentiation, concentration of power, mismatch between the necessary and available skills and increased cyber risk. States, on the other hand, will face pressure to mitigate the unintended consequences of technology and changing economic dependencies, among others.
“While technology is having a positive impact at all levels of society and will play a critical role in solving some of the challenges facing the world, if due attention is not paid to these consequences before appear, there is a high probability that the negative implications of technology will outweigh the positive ones”, comments Martín Barbafina, partner at PwC Argentina in charge of Marketing and Communications.
The average age is increasing all over the world, but in each country at a different rate and this causes the breakdown of social security systems and the lack of labor in critical areas. Some countries face high levels of unemployment and weakening economies due to the emigration of citizens and the pressure on social support networks.
In this context, companies must deal with changes in consumption patterns, conflicts at work, and often a lack of qualified personnel. States, for their part, face massive migration, social polarization, failure of welfare systems, and erosion of the tax base.
To address these challenges, then, fair migration is needed. Countries with a low median age will need to focus on building thriving local economies, for which they need the help of strong economies.
As more states compete for global influence, the world is fractured and multimodal. The rest of the countries align around them, while some nations act as destabilizing factors. In response, more and more countries are looking inward, prioritizing their national resilience and their future location.
The decrease in personal security due to conflicts, the exacerbation of local concerns, the loss of freedoms and the increase in human rights violations will be the consequences that citizens will have to face. Companies, for their part, will find it difficult to do business in a world of contradictory rules and regulations, while international conflicts, insecurity, and migration will increase within countries, and there will be regions destabilized by the rise of subnational agents.
To address this, nations will need to work together to develop a new basis for international collaboration and to redesign or create new multilateral mechanisms that correspond to the needs of a changing world.
Massive pressure resulting from social and economic polarization, demographic upheavals, and the erosion of trust result in further social unrest. In this context, the possibilities of upward mobility decrease, thus increasing discontent. Companies must reconcile divergent needs within their staff and have greater responsibility to meet the needs of employees, while, in countries, the middle class is eroding, thus increasing world poverty and the real risk of political instability as a consequence of the deterioration of institutions and the increase of skepticism.
This is how the interaction between these megatrends becomes especially difficult to address. Each one of them is exacerbating the social challenges that the world is facing and the magnitude of these challenges brings with it the difficulty for society to combat the effects of climate change, technological disruption, demographic changes, global fracturing and social instability.
“In recent years, social issues have become a priority as a result of the increase in economic disparity, social and political polarization, and the growing lack of confidence of citizens in institutions. If we anticipate these problems and take the lead on how to do business in a positive way, companies will not only exercise their moral conscience, but also obtain record levels of profits”, concluded Barbafina.
Published in El Economista (https://eleconomista.com.ar/negocios/las-5-megatendencias-estan-transformando-mundo-gran-velocidad-n60752).
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