08 February 2013, London, UK: The world's richer economies, including the US and the UK, can expect a decade or more of low growth, according to a new Future Perspectives report by The Futures Company.
The main factors shaping their economies point to falling productivity and squeezed margins from external pressures, which will continue to push down demand and reduce the scope for investment.
The report, entitled Succeeding in low-growth markets, outlines the seven factors that are causing this squeeze on growth. They include structural factors such as demographic change, the long-term shift towards services, the upward shift in long-term energy prices, and economic factors including continuing levels of consumer debt, greater inequality, and increasing business scale. The rise in digital technology, often seen as a source of innovation, has also stripped value out of economies.
The report builds on recent work by the American economist Tyler Cowen and economic historian Robert Gordon, who have each published widely-read articles about long-run growth rates.
The Futures Company Director, Andrew Curry, who co-authored the report, says: "The headwinds don't look good for growth over the next decade - everything has slowed down, from productivity levels to the rate of innovation. That doesn't mean there aren't opportunities for businesses out there, but it does mean they have to look harder for them."
Although the report argues that low growth will be the dominant factor in the economies of the US and Europe, that does not mean there is no scope for innovation. What is clear, though, is that innovation strategies will have to change.
The Futures Company Chairman and report co-author, J. Walker Smith, says: “Our purpose in publishing this report is to point out where and how businesses can succeed despite the on-going struggles of the broader economy. Low growth can be high growth for savvy businesses, and this is what’s been missing from other reports on low growth. Our report is about what to do, not just what’s coming.”
Succeeding in low-growth markets is available for download at http://thefuturescompany.com/free-thinking/. It is part of the Future Perspective series of thought-pieces with concise, focused insights into important issues of interest to marketing and business strategists. Recent titles in the series include Women 2020: How women’s actions and expectations are changing the future and The coming decade for Latin America.
About The Futures Company
The Futures Company is an award-winning, global strategic insight and innovation consultancy. Unparalleled global expertise in foresight and futures enables The Futures Company to unlock new sources of growth through a range of subscription services and research and consulting solutions.
The Futures Company was formed in 2008 from the coming together of The Henley Centre, HeadlightVision and Yankelovich.
The Futures Company is a Kantar company within WPP with teams in Europe, North America, Latin America and Asia.
Follow The Futures Company on Twitter @FuturesCo.