The Human Capital Index seeks to serve as a tool for capturing the complexity of education, employment and workforce dynamics so that various stakeholders are able to make better-informed decisions. Last year’s edition of the World Economic Forum’s Human Capital Report explored the factors contributing to the development of an educated, productive and healthy workforce. This year’s edition deepens the analysis by focusing on a number of key issues that can support better design of education policy and future workforce planning.

‘High Performance Working is a general approach to managing organisations that aims to stimulate more effective employee involvement and commitment to achieve high levels of performance’ (Belt and Giles 2009: ii). It is important because raising the supply of skills does not automatically result in the raising of workplace productivity. These skills need to be used and applied effectively in the workplace. High Performance Working (HPW) practices apply across a range of areas, including approaches to work organisation, employment relations, management and leadership, and organisational development.

Digital technologies have spread rapidly in much of the world. Digital dividends—that is, the broader development benefits from using these technologies—have lagged behind. In many instances, digital technologies have boosted growth, expanded opportunities, and improved service delivery. Yet their aggregate impact has fallen short and is unevenly distributed. For digital technologies to benefit everyone everywhere requires closing the remaining digital divide, especially in internet access. But greater digital adoption will not be enough. To get the most out of the digital revolution, countries also need to work on the “analog complements”—by strengthening regulations that ensure competition among businesses, by adapting workers’ skills to the demands of the new economy, and by ensuring that institutions are accountable.

First came the “fly-up,” the price spike on world markets for oil, gas, and a broad range of natural resources that began in 2003. Then came the abrupt bust, as prices tumbled and global spending on natural resources dropped by half in the course of 2015 alone. Now, even as resource companies and exporting countries pick up the pieces after this commodity “supercycle,” the sector is facing a new wave of disruption.1 Shifts taking place in the way resources are consumed as well as produced—less noticed than the rollercoaster commodity price ride but no less significant—will have major first- and second order effects on both the sector and the global economy. These shifts are the result of technological innovation, including the adoption of robotics, Internet of Things technology, and data analytics, along with macroeconomic trends and changing consumer behavior. We see three principal effects of this technological revolution: Consumption of energy will become less intense as people use energy more efficiently thanks to smart thermostats and other energy-saving devices in homes and offices, and the use of analytics and automation to optimize factory usage. Transportation, the largest user of oil, will be especially affected, by more fuel-efficient engines and by the burgeoning use of autonomous and electric vehicles and ride sharing. Technological advances will continue to bring down the cost of renewable energies such as solar and wind energy, as well as the cost of storing them. This will hand renewables a greater role in the global economy’s energy mix, with significant first- and second-order effects on producers and consumers of fossil fuels. Resource producers will be able to deploy a range of technologies in their operations, putting mines and wells that were once inaccessible within reach, raising the efficiency of extraction techniques, shifting to predictive maintenance, and using sophisticated data analysis to identify, extract, and manage resources. Scenarios we have modeled suggest that these developments have the potential to unlock $900 billion to $1.6 trillion in incremental cost savings throughout the global economy in 2035, an amount equivalent to the current GDP of Indonesia or, at the top end, Canada.2 As a result of lower energy intensity and technological advances that improve efficiency, energy productivity in the global economy could increase by 40 to 70 percent in 2035. We believe these changes will have profound implications not just for companies in the resource sector and for countries that export resources, but also for businesses and consumers everywhere.

Global migration is now at the center of policy debates in countries around the world—and while it is fair to have these debates, it is critical to ensure they are based on facts and evidence. The McKinsey Global Institute (MGI) has undertaken an ambitious research effort to understand the patterns and economic impact of people moving across the world’s borders. Combining an extensive review of hundreds of existing studies with expert interviews and our own economic analysis, we look at both voluntary and forced migration across more than 200 countries. We aim to provide a global perspective that is often missing from the current conversation, looking at broader migration patterns and specific population segments. Our research analyzes the impact of migration on labor markets and wages, on the global economy, on destination and origin countries, and on both native-born populations and migrants themselves.

The time we spend online is political. We may not think it so, but our engagement with the digital world is increasingly resembling a product that is stored, studied and sold. Our digital presences make up a mass that has come to be so valuable it is forcing entire political and economic structures to rewrite themselves. At the root of these changes are the major digital platform companies. Our extraordinary generosity needs to be set against the profitability of the work we do for the platform giants. Alphabet and Facebook alone reported £9 billion in UK sales in 2017, revenues on which they paid a total of £65 million in tax. Our first proposal, therefore, is to treat digital companies, for tax purposes, in the same way as conventional ones. Secondly, we seek to make an explicit connection between a reduced working week and our collective digital labour. By reframing the time, we spend online as labour, we intend to overcome the conceptual and cultural resistance to a 30-hour week. In simple terms, the working week would not be reduced, but merely altered to account for unrecognised labour, which would be rewarded to the benefit of millions of UK citizens.

Narrowing the global gender gap in work would not only be equitable in the broadest sense but could double the contribution of women to global GDP growth between 2014 and 2025. Delivering that impact, however, will require tackling gender equality in society.

This report examines recent changes in the logistics sector with special focus on technological change and the implications for future skills and training needs. Technological systems are considered to be a ‘competitive weapon’ for the logistics sector (Piplani et al, 2004). These systems can be any hardware or software that automates basic operational processes. However, to gain competitive edge from these technologies, expert knowledge or specialised skills are needed particularly IT skills and analytical skills. The research draws on an extensive literature review and analysis of the latest UK Employer Skills Survey (UKCES, 2014a), as well as drawing on the insights of employers and stakeholders through fifteen in-depth interviews and three focus groups to provide an assessment of the nature of the knowledge and skills needs required.

The 2013 survey represents the second edition in the combined UK series. It explores the skills challenges that employers face both within their existing workforces and in terms of bringing in new skilled labour, the levels and nature of training investment, recruitment of young people and education leavers and the relationship between skills challenges, training activity and business strategy. The study reports on the experiences of employers at the establishment level, rather than at the enterprise level. Sole traders and establishments with just one employee and no working proprietors were excluded from the survey population.