Advanced Economies’ Missing Link
After a decade of recovery from the 2008 financial crisis, aggregate economic indicators across the OECD are looking bright, with GDP continuing to grow and employment reaching record levels. So why is public sentiment in the advanced economies so gloomy?
AMSTERDAM – As 2020 gets underway, employment in both Europe and the United States is at a record high and still rising. The job losses from the 2008 financial crisis and subsequent recession have been all but reversed. But you wouldn’t know it from the public mood in many developed countries. With so much good economic news, why is public sentiment so gloomy?
New research by the McKinsey Global Institute takes a deeper look at the advanced economies to determine how individuals’ experiences as workers, consumers, and savers have changed over the past 20 years. There is much to cheer about, including new opportunities for employment and lower prices for some goods and services. Yet there are also at least three critical issues that are adversely affecting hundreds of millions of people across 22 OECD countries, which may help to explain the mismatch between aggregate economic data and individual experience.
First, consider the good news. Job opportunities have expanded substantially in the first two decades of the twenty-first century, with employment rates across the 22 OECD countries climbing above 70%, on average. Some 45 million more people are employed today than were in 2000, and 31 million of them are women. Part-time employment, especially voluntary part-time employment offering more flexible work, expanded for both men and women.