McKinsey & Company

March 2025For the first time since March 2022, surveyed executives foresee geopolitical instability as the top risk to companies’ growth over the next 12 months. In the latest McKinsey Global Survey on economic conditions, weak demand—which was the most-cited risk in the previous three quarters—is now the second-most-cited disruption, followed closely by changes in the trade environment and trade relationships. While private sector respondents remain more likely to expect improvement than…

So much can change in three months. In the December edition of our quarterly McKinsey Global Survey on economic conditions, respondents’ expectations for the global economy were largely stable with the previous quarter and more positive than negative. Now, amid a spate of policy shifts, uncertainty permeates views on the economy in the latest survey. Respondents are now equally likely to see geopolitical instability and changes in trade policy or relationships…

A just and inclusive society has long been a strength of European countries. The continent is a world leader in advancing social imperatives such as gender equality and, historically, socioeconomic mobility. Yet progress on the latter has stalled in recent years, limiting the economic growth that is vital for Europe’s competitiveness. Research shows that social mobility can accelerate productivity—including through greater workforce participation, better skills matching, higher consumer spending, fewer…

The downstream wholesale market in the United States is a critical component of the refined fuel supply chain, moving fuel from refineries to end users through pipelines and secondary terminals countrywide (see sidebar “Refinery-to-rack and rack-to-retail: Definitions”). However, many companies in this sector are grappling with the challenges posed by shifting macroeconomic and geopolitical forces. To thrive in this complex environment, operators need to make integrated, data-driven decisions to capture…

US midsize industrial companies are renowned for their distinctive technologies, widely recognized products, and strong brands. But in terms of performance, they could do a lot more. If they realize their full potential, they could collectively boost US GDP by $275 billion to $460 billion and add up to 1.5 million jobs by 2030, a McKinsey Global Institute analysis shows. What’s more, by raising their profiles and performance, they could…

Across sectors, companies are accelerating remanufacturing as a way to mitigate supply chain shortages, reach new customers through affordability, and implement high-margin alternatives for parts. However, those looking to build or optimize their remanufacturing operations face unique challenges, such as pricing a long tail of SKUs and undertaking accurate core forecasting—that is, predicting the volume, timing, and quality of returned products (core) that will be available for remanufacturing. Enter AI.…

Mounting headwinds in recent years have prompted biopharmaceutical companies to redefine how they create and sustain value. Over the past decade, the industry has produced major scientific breakthroughs, leading to improved outcomes for patients and strong shareholder returns of roughly 9 percent annually. However, companies are increasingly competing within crowded therapeutic spaces, asset life cycles are compressing, and major patents are expiring—all of which are compounded by stagnant R&D productivity,…

While it is increasingly clear that the contact center of the future is likely to be an AI-led environment, the pace at which companies will arrive at this future state is far less certain. Today’s leaders are faced with the difficult choice of just how far to go with their automation plans to retain the right balance between humans and AI as they build toward this AI future. There is…

Translating fashion’s decarbonization targets into action has proved difficult, as we wrote in our March 2024 article. At the time, we outlined six actions fashion brands could take to become more sustainable. Among those, one stands out as having the highest potential impact: working with Tier 2 suppliers to reduce emissions. Tier 2 production—the stage in which fabrics are produced and treated before being assembled by Tier 1 suppliers—typically accounts…

Spain is well-positioned to boost its sustainable fuel production and become a major producer as Europe accelerates its net-zero transition. The European Union has set a target to reduce greenhouse gas (GHG) emissions by at least 55 percent by 2030 compared to the 1990 levels. To achieve this target, major changes are required in Spain’s energy consumption and efficiency, shifting from fossil fuels to more sustainable energy sources by embracing…

McKinsey analysis of the performance of more than 50 industrial organizations over a 15-year period found that those with a high service focus generated 1.7 times the total shareholder returns (TSR) of those that focused mainly on products. In the aftermarket and field services context, services cover a wide range of activities. They range from the traditional—such as equipment installation and commissioning, or repair and aftermarket supply of components and…

Organizations are starting to make organizational changes designed to generate future value from gen AI, and large companies are leading the way. The latest McKinsey Global Survey on AI finds that organizations are beginning to take steps that drive bottom-line impact—for example, redesigning workflows as they deploy gen AI and putting senior leaders in critical roles, such as overseeing AI governance. The findings also show that organizations are working to mitigate…

In the payments industry, open banking and account-to-account payments have experienced slower adoption in certain markets as they compete with card-based and peer-to-peer systems. In this episode of Talking Banking Matters, McKinsey payments sector leader Roshan Varadarajan speaks with Johan Tjärnberg, the Group CEO of the open-banking and account-to-account company Trustly. The following edited transcript shares highlights from the conversation. For more discussion of the banking issues that matter, follow…

In an era of persistent change, how can companies foster an environment that empowers employees to anticipate, respond to, and even leverage unexpected shifts in the business landscape? In this episode of McKinsey Talks Operations, host Daphne Luchtenberg is joined by McKinsey Senior Partners Dan Swan and Ruth Heuss, global co-conveners of McKinsey’s Operations Practice, to explore strategies and approaches to technology, workforce planning, and sustainability that will help organizations remain agile…

Recent years have seen the publication of a number of reports about how water and wastewater utilities in the United States can become more resilient, particularly when it comes to addressing rapidly aging infrastructure, optimizing operational efficiencies, and contending with increasing water demand. There has been significantly less discussion about how state and local leaders (including mayors and county offices) can help water utilities invest in resilience. We believe that…

Judy Marks is one of a few dozen women leading a Fortune 500 company. Otis Worldwide Corporation has been making elevators for more than 170 years, so it has seen its share of change over the decades. So has Judy. Not long after joining Otis as president in 2017, she quickly became CEO and led the company through a spin-off from its former parent to become its own, independently traded…

The sporting goods industry faced a difficult environment in 2024. Softer growth prospects, persistent inflation, and cautious consumer spending all tested companies’ resilience. Despite these hurdles, the industry managed to sustain a growth rate of 7 percent a year from 2021 to 2024 (Exhibit 1). The growth outlook for 2024 to 2029 is projected at a slightly more modest 6 percent a year, driven by a slowdown in the Asia–Pacific,…

The automotive industry—including OEMs of passenger cars and trucks, suppliers, and downstream players such as aftermarket or financing providers—is a major part of Europe’s economy. These players collectively account for 7 percent of Europe’s GDP, providing about 13.8 million direct and indirect jobs. In 2019, the European Union dominated the global automotive market, hosting ten of the top 20 suppliers and four of the top ten OEMs by revenue. Yet…

The invention of the automobile in the late 1800s soon attracted entrepreneurs. Car manufacturers sprung up across the world, with the number in the United States increasing from 30 in 1899 to about 500 by 1910. The early industry’s hallmark was rapid and constant innovation, which included the introduction of V-8 engines, the replacement of hand cranks with electric starters, and the addition of folding tops for weather protection. By…

Over the past few years, our analysis shows that the engineering and construction (E&C) industry has grown steadily by about 5 percent per annum. This number is expected to accelerate to 6 to 7 percent by 2030 in response to a confluence of tailwinds, including continued growth in emerging markets, such as Asia and the Middle East; government infrastructure programs and megaprojects in Europe and North America; pent-up demand for…

Services drive the global economy. They make up 75 percent of real gross value-added activity in high-income countries and 63 percent of the same measure in low- and middle-income countries (LMICs). Globally, value-added trade in services now exceeds trade in goods, and services are growing faster than the total world economy. Yet economic development efforts in LMICs often still focus on manufacturing and while that may be understandable—it was the…

NEWARK/BARCELONA – The effects of falling birth rates and rising life expectancy are increasingly evident in advanced economies like Germany, Italy, and Japan. Labor markets are tightening, worker shortages are worsening, and families are struggling to find care for aging parents. In some areas, declining student numbers are forcing schools to shut down.South Korea offers a stark example. In 2023, as the country’s total fertility rate plummeted to just 0.7…

McKinsey Global Institute (MGI) found that as of 2020, about 61% of the global population were unable to pay for their basic daily needs and begin to save. Building on the work of development economists, we established the “empowerment line” to measure progress towards a world where everyone’s essential needs are met.Higher than the international poverty line, the empowerment line varies greatly from country to country. In the lowest income…

US consumers are taking an increasingly active role in their health, seeking information from a variety of sources and considering new engagement models. As this trend continues, healthcare organizations must recognize that many of the assumptions that they have made about healthcare consumers no longer hold true. Addressing these changed expectations and interests can unlock substantial opportunity to engage consumers across their healthcare journeys more effectively and improve business results.It’s…

In 2013, SQM, based in Santiago, Chile, became the first mining company to adapt the principles of lean management to the complexities of extracting minerals in some of the world’s most challenging locations. Three years into the company’s transformation, McKinsey spoke with three senior SQM executives about the organization’s progress—especially the lasting benefits from changing the way people lead. Now, more than ten years after SQM’s journey began, leaders at…

Can a steel company build the infrastructure for the rapidly growing data center business? Nucor CEO Leon Topalian thinks so. Through a series of recent acquisitions, the company aims to offer customers made-to-order data center buildings with most of the components they require—cooling systems, overhead doors, equipment racks, and more—not just the steel that goes into them. That’s just one of the many opportunities Nucor is pursuing. With a history…

This is a special, bonus episode of The McKinsey Podcast. McKinsey Partner Ferry Grijpink joined McKinsey Editorial Director Roberta Fusaro to share some immediate takeaways from the annual Mobile World Congress (MWC) event in Barcelona.The McKinsey Podcast is hosted by Roberta Fusaro and Lucia Rahilly. This transcript has been edited for clarity and length. Roberta Fusaro: What’s the mood in Barcelona? Ferry Grijpink: On the one hand, it’s very exciting. We…

Senior housing—the spectrum of residential solutions aimed at people over age 65—is a sector associated with many needs. By 2050, the world is expected to have 1.6 billion people in this age cohort, more than double the number in 2021. Due to the rising prevalence of chronic illnesses among the elderly, it is likely that less than half of them will perceive themselves as being in good physical, mental, and…

Although there is meaningful momentum, the world is not on track to achieve greenhouse gas emission reductions in line with the Paris Agreement’s goals. Despite numerous net-zero commitments from countries and companies, and an increase in climate-related investments, global CO2 emissions are far from on track to reach net-zero by 2050. As the world considers how to meet climate goals in the aggregate, national decision makers will need a comprehensive…

A sleek, metallic car with a glass rooftop is depicted in a 3D image against a gray backdrop, giving off a futuristic vibe. Self-driving cars, or autonomous vehicles (AVs), have zoomed around our popular imaginations for decades. In recent years, films and television shows such as WALL-E and Silicon Valley have poked fun at early versions of self-driving cars—and even further back, in the 1980s series Knight Rider, a retro…

Since the early 17th century, New York has been a global hub for the flow of goods, capital, people, and ideas. It has experienced constant economic transformation, dominating first in the fur trade, then in shipping, sugar refinement, machine tools, the garment trade, business services, and finance. Through its evolution, New York has grown not only as a center of innovation but also as a catalyst for progress around the…

In this episode of Eureka!, a McKinsey podcast on innovation in life sciences R&D, hosts Navraj Nagra and Alex Devereson speak to Kim Branson, senior vice president and global head of AI and machine learning at GSK. They discuss how these emerging technologies are being used to potentially reshape how drugs are developed and about the complexities AI and machine learning introduce in data management, cross-functional collaboration, and responsible innovation.…

Trucking is a significant source of emissions. Given that transportation is the second-largest source of greenhouse gas emissions in the United States, with medium- and heavy-duty trucks accounting for about a quarter of these, transitioning fleets to zero-emission vehicles (ZEVs) has emerged as an urgent priority. McKinsey’s recent survey of more than 200 US trucking fleets found that while two-thirds are committed to decarbonization and over half are piloting ZEVs,…

At Davos 2025, the 55th Annual Meeting of the World Economic Forum, Shelley Stewart III, senior partner at McKinsey, and Angela F. Williams, president and CEO of United Way Worldwide, sat down to discuss some of the key themes of the conference. The conversation explored investments in people, collaboration, AI and technology, and how United Way Worldwide is thinking about these themes in serving communities. Their discussion also highlights the…

Workplaces are full of talented, educated, and hardworking women. Many are caught off guard when, several years into their careers, they see that they are falling behind their peers, and they can’t put a finger on exactly how or why. Women, after all, are doing everything they can to prepare themselves for successful careers. As early as kindergarten, girls on average outperform boys across all disciplines, including math. Women in…

By Becca Coggins, Christina Adams, and Kari AlldredgeIn the first quarter of 2025, US consumers reported feeling nearly as optimistic as they did at the end of the previous year. This optimism was buoyed by a robust economy with low unemployment, steady job growth, and stable inflation. However, for US consumers across income groups and generations, spending intentions were down across several discretionary categories. Unlike in early 2024 (when consumers carried their…

Telecom operators have long provided the infrastructure to power communication and connect people. Now they are poised to take on a new role: building the AI infrastructure that enables enterprises, governments, and consumers to unlock AI’s full potential. But finding the sweet spot to capture meaningful revenue and renewed success will require speed and precision amid complex market dynamics, uncertain demand, and significant competitive headwinds. Delays or missteps may heighten…

After a prolonged period of disruption spurred by new technologies, new competitors, rapidly evolving customer demands, and dwindling opportunities in the B2C space, the telecom industry is now in a position to catalyze rapid B2B growth. McKinsey’s latest survey of decision makers across industries and geographies found that more than half of companies are planning to increase telecommunications and technology spending this year as organizations rush to embrace artificial intelligence…

As telecommunications companies employ better AI and other analytics tools to increase the resolution of their view into customer satisfaction, they’re quickly reaching the point where they can be more precise about their capital allocations to efficiently expand and improve the network. By building on telcos’ recent advances in data and AI (such as data digital twins and a more robust cloud IT infrastructure) that provide clearer insights into how…

Banking has had a couple of very good years—the best, in fact, since the global financial crisis of 2007–09. Yet to some, the industry’s outlook seems less buoyant than recent profitability might suggest. On this episode of The McKinsey Podcast, McKinsey Senior Partners Klaus Dallerup and Pradip Patiath speak with McKinsey Global Editorial Director Lucia Rahilly about McKinsey’s latest global banking annual review, breaking down the sources of skepticism, the risks and…