“The numbers are stunning,” the FT’s Gillian Tett said of our climate-change research in Aspen, Colorado, last month. “I would challenge anyone who sees [them] to walk away and just say, ‘whatever.’”
That’s one example of how McKinsey insights shaped conversations this year at the 2019 Aspen Ideas Festival, where our firm once again served as Knowledge Partner. An annual non-partisan event held by the Aspen Institute, the Ideas Festival is dedicated to discussing the biggest issues shaping our times.
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McKinsey_Website_Accessibility@mckinsey.comThe artist Common, performing “Let Love: An expression of art, words, and song” at the 2019 Aspen Ideas Festival. (Property of the Aspen Institute / Photo Credit: Leigh Vogel)
Every June, the event brings together hundreds of luminaries from the worlds of business, government, art, media, and sport. Speakers this year included the likes of Mark Zuckerberg, Janet Napolitano, the rap artist Common, the New Yorker’s Masha Gessen, the NBA’s Kevin Love, and more.
Four of our colleagues joined that esteemed company, presenting throughout the week some of McKinsey’s latest research on issues that matter hugely to businesses and society alike. Here’s what they shared.
Andre Dua on “The Zip Code Reality”
Andre Dua, a senior partner at our firm who founded and leads McKinsey’s higher-education work, laid out a fact base for one of the most talked-about conversations at this year’s Ideas Festival: “The Zip Code Reality: Where You Live Matters.”
Citing our firm’s long program of research around the future of work, Andre shared an early look at our newest report on the topic, published July 11, called “The future of work in America: People and places, today and tomorrow.” The New York Times’s David Brooks, former U.S. Commerce Secretary Penny Pritzker, and San Francisco Federal Reserve Bank President and CEO Mary Daly took the stage after Andre’s presentation, citing our work frequently in their remarks.
Andre’s talk focused specifically on our efforts to project the impact of automation over the next 10 years at as granular a level as we could understand it. While much of the public conversation on this issue has been about jobs lost and jobs displaced, he said, the more important story is one about transformation.
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McKinsey_Website_Accessibility@mckinsey.comAndre Dua, presenting at the 2019 Aspen Ideas Festival. (Property of the Aspen Institute / Photo Credit: Riccardo Savi)
About 40 percent of U.S. jobs, Andre explained, are currently in occupational categories that could shrink over the next decade. Many of them feature routine or physical tasks, and the jobs with the greatest displacement potential, he added, overlap with those that have lower educational requirements.
Different demographic groups will therefore differently feel the impact of automation. “Individuals with a high school diploma or less are four times more likely to be in an automatable job than someone with a bachelor’s degree or higher,” Andre said. “And they are 14 times more likely to be in an automatable job than someone with a graduate degree.”
About midway through his talk, Andre shared a map our firm produced to review all of the counties in the U.S. “We looked at the composition of jobs in each economy, the skills required for those jobs, and which of those skills are automatable,” he said. “Based on that, we made predictions about job losses and job gains.”
What our firm found was that the story about the future of work is not a simplistic narrative about rural versus urban, or one region of the country versus another.
We have a real opportunity to respond locally,” he added, “to reflect local economic circumstances.
Instead, our research shows that the future of work is shaping up to be a granular story about specific differences in communities. Andre reminded the audience how important it is to not lose sight of the fact that behind the numbers, such as the millions of jobs that will be transformed, there are individual human stories of real pain and real disruption that must be accounted for.
So what do we do? According to Andre, the communities where progress on this front is being made feature the full ecosystem of players—companies, educational institutions, governments, NGOs, labor unions, and so on—coming together. “We’re going to need to more fully deploy and scale things that we are seeing working in some parts of the country to others,” Andre said.
With this research, he added, “we have a real opportunity to respond locally, to reflect local economic circumstances.”
Lareina Yee on “Breaking Barriers”
Our chief diversity and inclusion officer Lareina Yee kicked off the week with a conversation called “Breaking Barriers: Women Defining Leadership,” where she laid out a fact-base and then joined a discussion with leaders from business, tech, and beyond. Pamela Reeves, a senior fellow in international and public policy at Brown University and founder of Reeves Advisory, moderated.
According to our latest Women in the Workplace report, Lareina explained, women today are outnumbered five to one in the C-suite, and only 79 women for every 100 men are promoted to manager. Those numbers, she added, are even bleaker for women of color, who are outnumbered 25 to one in the C-suite. Only 60 Black women for every 100 men, Lareina added, are promoted to manager.
Lareina’s fellow panelists talked about the impact these trends can have on women’s advancement. Microsoft’s Executive Vice President of Business Development Peggy Johnson talked about her early career, when she almost left engineering because of the feedback she was getting on performance reviews that measured things like assertiveness but not collaboration.
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McKinsey_Website_Accessibility@mckinsey.comLareina Yee, presenting at the 2019 Aspen Ideas Festival. (Property of the Aspen Institute / Photo Credit: Ian Wagreich)
Peggy’s manager at the time lobbied for changes to the review process. Yet our research shows that women don’t receive that kind of support often enough. Managers, Lareina explained, are less likely to help women navigate office politics than men, and women are also less likely to be given the resources they need to succeed.
At least one young woman is undaunted by these barriers. Lareina’s fellow panelist Lauren Simmons, who at just 23 years old became the New York Stock Exchange’s youngest female equity trader and only the second African American woman to hold that position in the exchange’s 227-year history, offered one of the event’s most memorable quotes. “We don’t need gatekeepers,” she said, “to make our dreams a reality.”
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McKinsey_Website_Accessibility@mckinsey.comLareina Yee’s fellow 2019 Aspen Ideas Festival panelists Peggy Johnson and Lauren Simmons. (Property of the Aspen Institute / Photo Credit: Ian Wagreich)
Our firm is optimistic about the future of women at work. According to Lareina, who leads our global technology hardware and services work, some 164 million new jobs—or 10 percent of employment in 2030—could be created in entirely new occupations as automation transforms the economy.
If governments, companies, and individuals invest in the right training programs for women to develop the necessary skills; develop the support networks they need to boost labor mobility and flexibility; and improve their access to technology, Lareina said, the barriers women face today might soon, and finally, fall.
Dickon Pinner on “Climate Breaking Points”
McKinsey’s Sustainability Practice co-founder and leader Dickon Pinner joined the FT’s Gillian Tett, Prudential’s Phil Waldeck, and Oxford Professor Cameron Hepburn for a session called “Climate Breaking Points: Business Strategies to Mitigate Economic and Social Risks.”
At the start of the panel, Dickon made the case for two climate-related actions: decarbonization and climate resiliency. Explaining how businesses are critical to reversing climate change, he argued that executives need access to the best available climate data, forecasting techniques, and risk analytics.
Companies tend to be preoccupied with the cost of making climate-related business changes, Dickon explained. Yet they are often less aware of the huge potential financial losses they already face, especially as extreme weather events become more frequent and severe.
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McKinsey_Website_Accessibility@mckinsey.comDickon Pinner leads McKinsey’s Sustainability Practice globally. (Property of the Aspen Institute / Photo Credit: Riccardo Savi)
For instance, McKinsey assessed the financial records of ten large power utilities in seven U.S. states where hurricanes are common. We found that over a 20-year period a typical utility could see $1.4 billion in storm-damage costs, losing significant revenues due to storm outages along the way.
Effectively for investors, numbers like that amount to debt that organizations are exposed to, explained Phil. If they are made aware of it, the volume of that exposure can have an impact on the will of people to act. “There’s a word for this,” Phil added, “it’s called leverage.”
Cameron echoed this point. Boards and companies all around the world, he explained, should understand that they have deep supply chain risks. “The reality,” he said, “is that there are a lot of people exposed who don’t know they’re exposed.”
Our view at McKinsey, Dickon explained, is that by converting good science to numbers that help organizations see the potential business risks of not addressing climate change, we can seize this extraordinary moment and make real progress.
Michael Chui on “Can We Trust Tech?”
Michael Chui, a partner with the McKinsey Global Institute, sat down with Craigslist Founder Craig Newmark, former Facebook chief security officer and Stanford research professor Alex Stamos, Stanford Center for Ethics in Society professor Rob Reich, and Aspen Tech Policy Hub Director Betsy Cooper for a lively conversation about how to build technology and solutions for good that encourage trust.
The chat began as a looser version of a McKinsey problem-solving session, which saw Michael ask each panelist to frame the challenge they face when it comes to tech and trust. For Alex, who headed up Facebook’s investigation into alleged foreign interference in the 2016 U.S. Presidential election, the answer was simple: stopping “bad guys from doing bad things with computers,” he said.
To that end, Alex and his colleagues have created the Stanford Internet Observatory, a program designed to help organizations of all kinds better see the internet, as he put it. In the same way that astronomers use a celestial observatory to understand what’s happening in space, Alex explained, researchers can use the Internet Observatory to see and respond to what happens online.
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McKinsey_Website_Accessibility@mckinsey.comMichael Chui, presenting at the 2019 Aspen Ideas Festival. (Property of the Aspen Institute / Photo Credit: Dan Bayer)
In theory, some of those responses could take the form of tech-driven policy, which is the big issue Betsy and the Aspen Tech Policy Hub are trying to address. This program accepts mid-career technology professionals as fellows and provides them with practical training in policy development, as they develop solutions to real-life policy problems.
Merging the values of tech with the values of the world beyond tech lies at the heart of Rob Reich’s academic work, which involves using lessons from the humanities to inform the decisions engineers and other technologists make.
What he has in mind, he explained, is to follow the lead of schools that teach law and medicine—which provide instruction in ethics and morality—to build lessons into engineering curricula that teach engineers how to make decisions that are good for business, good for technology, and good for society.
Craig Newmark, through his organization Craig Newmark Philanthropies, works toward the same aim in his efforts to “protect the values that America aspires to.” In particular, his group focuses on protecting a free press, voter rights, advancing women in tech, and supporting veterans and military families.
It’s not easy to do. Perhaps the most well-known technologist onstage that afternoon, Craig talked about the challenge developers face from bad actors like hackers, while also admitting that technologists themselves also bring certain inherent flaws to their work.
“Sometimes in our excitement for the technology,” he said, “we don’t consider the unanticipated consequences.”