As advanced economies around the world emerged from the 2008 financial crisis, they began an arduous journey toward protracted recovery. Today, labor markets in these advanced economies are still among the tightest in two decades, with the number of job vacancies per unemployed person having increased by more than four times on average by 2023.
How does labor tightness affect economic productivity and output? In this data-driven report by the McKinsey Global Institute, senior partner Olivia White and coauthors say that “GDP in 2023 could have been 0.5 percent to 1.5 percent higher across these economies if employers had been able to fill their excess job vacancies.” What’s more, since 2010, countries that have increased GDP fastest have done so primarily by adding more jobs rather than by tackling the harder job of improving productivity. Now, to maintain their current level of growth, advanced economies will need to find ways to both expand the workforce and boost productivity.
To be better prepared for the future, explore these insights to learn more about labor market tightness and the productivity imperative.
Help wanted: Charting the challenge of tight labor markets in advanced economies
The ups and downs of global productivity
Investing in productivity growth
2024 and beyond: Will it be economic stagnation or the advent of productivity-driven abundance?
The economic potential of generative AI: The next productivity frontier
A microscope on small businesses: Spotting opportunities to boost productivity
Human capital at work: The value of experience
Today’s skills, tomorrow’s jobs: How will your team fare in the future of work?
MORE FROM MCKINSEY
Chart of the Day: Productivity picks up the pace