2021: Return of the "Golden Twenties"?

The (nineteen-) twenties are sometimes also referred to as the "Golden Twenties". After Germany overcame hyperinflation in 1923, the economy began to improve. The twenties were also a good time abroad and became known in English as the "Roaring Twenties". Unfortunately, the global economic crisis in 1929 quickly put an end to this.

One hundred years later, the world is shaken by corona, global warming and political populism. But if we take a step back and look at the bigger trends, there is reason for optimism. Below I outline three reasons why the next ten years will bring us enormous progress and prosperity.

2010s

If we look back at the decade, the results weren't really that great, at least from an economic point of view. Self-driving cars have not come as quickly as initially claimed. (Although this is also due to the Hype cycle is indebted). Although smartphones and social media have grown at an insane speed in this decade, they have not caused any major productivity gains. At the same time, the fear of security breaches slowed down several industrial trends.

Covid-19 unleashes innovation

But deep into the second lockdown, Covid-19 is the best example of what is possible: Within less than a year, we have developed and approved several vaccines. Covid-19 has also unleashed huge innovation potential in other industries. This was only possible because the potential was already there.

Vaccinations based on mRNA are in use for around ten years. Hardly anyone noticed anything about this, as it was primarily about cancer therapies. The idea of using such vaccines on a larger scale was already there, but there was no urgency. Covid-19 changed all that and the potential of this technology was unleashed in an incredibly short space of time.

Also Artificial intelligence (AI) falls into this area. Although self-driving cars are not yet commercially successful, they are nevertheless an impressive example of AI. A better example is the breakthrough in protein folding, which has enormous potential to transform medicine.

Expenditure on innovative research increases

The second reason is the enormous increase in investment in research and development. The last few years there was stagnation here. That is now changing. Adjusted for inflation, research spending in OECD countries has only been rising since 2017, before that it was falling. This is certainly due to the fact that technology is flowing into more and more areas of life and is therefore enabling much more innovation than before. Medical technology is a good example of this.

And innovations are being adopted faster than ever. A good example of this is conferencing systems, which many companies implemented within a very short space of time, keeping their employees productive. Of course, innovations also make jobs redundant, as we saw in the decade. Accelerating innovation will not reduce this, but it will (hopefully) create a disproportionate number of new opportunities.

There are plenty of potential applications for innovative solutions: new battery production, global warming and electronic patient records: We still have a mountain of topics and industries that we need to transform.

The World Economic Form sees it the same way: In a In a recent article, the WEF predicts 85 million displaced jobs, but 97 million new jobs. The article also looks at the skills that employees will need.

Conclusion

We don't know what things will look like in the 2030s. Who knows, maybe machines will finally take over all our tasks and we will be unemployed. I hope it won't be like that. But that's ten years from now: Now we can hopefully look forward to the return of the "Golden Twenties".

Image source: Wikipedia