Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

2014 Economy of US Infographic


Published on

Key features of the system and how it will differ from the current system.

Published in: Government & Nonprofit
  • Be the first to comment

2014 Economy of US Infographic

  1. 1. Re-Imagined Infrastructure System Global Change and The US Economic Position in the World US 2040 Economy Key features of the system and how it will differ from the current system • The world will continue on the path seen in the last 150 years where world wealth doubles every 15 years. Toward the end of the period, this may increase as new technologies reach a tipping point and usher in dramatic social and economic change. • The United States will grow on average at a rate of a little over 3 percent a year over the whole period—this is the approximate average growth in US GDP since the 1870s. • The United States will continue to have one of the highest standards of living (in terms of GDP per capita) of all major developed economies. Overall Structure of the Economy • The United States will continue to be a largely free-market economy; however, all industries and firms will face increasing competition and reduced margins. • The public sector will be characterized by increasing privatization, public–private partnerships, and market-priced provision of services. • Subsidies for major public products and services will disappear and be replaced by market pricing systems. Market Size and Available Workforce • The United States will remain a vital, growing nation with a population of more than 400 million. It will still attract immigrants and grow through ­internal demographic change—nearly 20 percent of Americans will be immigrants, compared with 10 percent today. • The number of working-age Americans and children will grow more slowly than the elderly population and will shrink as a share of the total population, but the United States will still have one of the youngest population among developed countries and one with the largest working age population. • Workers will be: (1) substantially better trained and higher skilled than today; (2) much more specialized; (2) more fluid and flexible, changing jobs and careers several times in their life; and (3) engaged in life-long education and training. Distribution of Economic Activity • Population and economic activity will continue to come from the megaregions and the megacities within them—more than 95 percent of US economic activity will come from these areas. • The regions outside the megaregions will be dominated by primary production (e.g., agriculture, forestry and fishing, mining, and extraction of oil and gas), tourism, and eco-zone protection. • Population will become more concentrated, with the outer suburbs declining as increased transportation costs reduce the benefits of living far away from growing cities; however, the suburbs will remain but will be more densely populated and less dependent on automobiles. Nature of Work: Major changes to work • Automation will continue to replace routine work and production (e.g., manufacturing, routine customer interactions). Lower-skilled “interaction work”—jobs that must be done face-to to-face today that require the exchange of complex information, such as food service, delivery services, security, janitorial services, retail—be increasingly automated, requiring fewer people. • Many highly skilled, highly paid, knowledge-based interaction jobs (i.e., jobs related to the development and exchange of complex information) will have been broken down into subspecialties and automated to the maximum extent possible, resulting in the erosion of wages in these occupations. Other highly skilled jobs (e.g., medicine, law) will be partially automated and use technology extensively. • More knowledge-based and interaction-heavy jobs will be virtual—this will extend to manufacturing and service work where a single worker will remotely control and monitor multiple real-world installations. Extensive, life-long training will be required to maintain in-demand skills. Technology Change • Technology change will continue to be a major driver for economic growth. • IT will continue to diffuse to new industries and products as increases in processing power, data storage and transmission, and machine ­intelligence increases drive the expansion of new and existing industries. • Biotechnology, nanotechnology, and artificial intelligence will produce major changes in industry and create new, as yet unimagined products and ­industries— robots and intelligent machines will be omnipresent in all industries. Distribution of Income, Wealth, and Prices • Globalization and rapid technological change will create a class of mega-rich—the first trillionaires will be seen in the United States. • Substantial wealth will be concentrated in older Americans as they continue to work to advanced years, accumulate wealth, and do not ­follow the typical retirement trajectory. • Automation of previously skilled groups will force downward pressure on wages for previously prosperous knowledge workers because interaction-based jobs require them to increase their skills or seek new careers. Distribution of Employment and the Contribution of Different Sectors to National Wealth • Telecommuting, virtual jobs, and tele-presence will mean that more than half of all jobs will be performed from home. • The service sector will continue to dominate the US economy. The growth of the service sector is a phenomenon seen in all advanced economies. • Manufacturing will continue to be a major contributor to the US economy but employ relatively fewer people than today given its importance to the economy. The United States will be one of the top five manufacturing nations. Most manufacturing will be technologically highly sophisticated, innovative, and capital intensive. Some industries and firms will reach zero employment with zero-worker factories—all production will be effectively automated apart from decisionmaking. • Primary production (farming, mining, resource extraction) will remain a major part of the US economy—however, it will employ relatively fewer people than today given its overall importance to the economy. Economic Change • The pace of economic change will increase dramatically (from technology, emergence of foreign competitors, diffusion of technology)—new industries and major firms will suddenly emerge, and old industries and market leaders will suddenly disappear. • Regions and cities will experience dramatic ups and downs as technology and new economic pressures constantly threaten to erode their comparative advantage. Disruptive Technologies • Approaching the Singularity? Many futurists believe we are on the verge of a great acceleration in technology as a number of key technologies (e.g., biotech, artificial intelligence, nontechnology) converge and create sudden, unprecedented, explosive economic growth. Between the Paleolithic Revolution and the Industrial Revolution, it is estimated world wealth doubled every 900 years. Since the 1860s, world wealth has double every 15 years. There is evidence that the speed of doubling is increasing as technologies converge (a phenomenon known as “consilience”) and diffuse into new industries and previously undeveloped countries. Futurists argue that it is feasible to think of the convergence of these trends reaching a point where technology and economic growth is essentially vertical on a trend line (known as a “Singularity”). Specifically, world wealth may double on an annual basis (if not faster), and vast unprecedented technological, social, economic, and environmental changes would occur. Potential Challenges • The difficulty in raising revenue and managing deficits may prevent the United States from investing in the education and infrastructure to maintain economic growth. • Continued economic inequality in the US economy may retard economic growth and spark increased social unrest. Alternatively, inequality may be evidence of major economic and technological change. Economic history shows that periods of dramatic increases in wealth by a small section of the population are often associated with periods of rapid economic and technological progress when a few innovation owners and experts are able to obtain dramatic returns on investment as new technologies are created and become widely used. • Major changes in the environment (e.g., climate change) and resource availability (e.g., peak oil) may dramatic slow economic growth or spur innovation in unexpected way. Potential Opportunities • Philanthropy, socially conscious investment, and new forms of economic organization and techniques (e.g., social bonds) suggest new ways of channeling investment toward social products. • While the US population will age, the United States will remain one of the youngest advanced societies—this will give the United States a major advantage over other advanced economies. • US civic culture and the free-market system may allow the American economy to develop innovate private sector or public–private sector responses to education and infrastructure challenges if the public sector is unable to act. System Operations Northwestern University Transportation Center Northwestern University Transportation Center