Study: Five US Game Changers for Growth & Renewal
The McKinsey Global Institute has identified five game changers in several sectors that could spur productivity gains, boost gross domestic product (GDP), and generate significant numbers of jobs by 2020 in the United States.
These five catalysts – energy, trade, big data, infrastructure, and talent – include specific sectors in which momentum is unfolding, such as shale gas and oil, as well as fundamental enablers that will underpin competitiveness across the broader economy, such as talent development, the McKinsey Global Institute stated in the “Game changers: Five opportunities for US growth and renewal” report. Most of these game changers “can immediately boost demand to accelerate the recovery, and all of them provide a foundation for long-term growth.”
Each catalyst can boost annual GDP by at least $150 billion by 2020 with energy providing the greatest annual GDP – about $700 billion for shale energy, and up to $1.7 trillion by 2030 for talent, according to the report. Energy, infrastructure and trade could deliver even more dramatic gains by 2030, potentially creating more than 1.5 million new jobs each year.
“If the United States fully realizes the opportunity, shale energy could revitalize the oil and gas industry, have downstream benefits for energy-intensive manufacturing, and send ripple effects across the economy,” stated Scott Nyquist, a leader of the energy practice with McKinsey Global Consulting, in the report. “We estimate that it could add 2 to 4 percent ($380 to $690 billion) to annual GDP and create up to 1.7 million permanent jobs by 2020.”
Furthermore, this sector could be a source of “high-wage employment for workers without college degrees, generating economic activity in parts of the country that have seen little investment in recent decades,” he added.
With the increase in hydrocarbon production, the annual GDP within the energy sector will surge from $115 to $225 billion by 2020. This increase will have a ripple effect and drive growth in manufacturing industries that rely heavily on natural gas as a fuel or feedstock, the report added.
As for infrastructure, the required structures needed to complete the necessary pipelines, rail networks, and drilling and gathering infrastructure would take up to $1.4 trillion in investment while generating 1.6 million temporary jobs during the build-out, mainly in the construction sector.
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