Economic uncertainty As of early 2025, the global economic outlook appears to be shaped by a combination of cautious optimism and persistent uncertainties. According to the World Economic Forum’s September 2024 Chief Economists Outlook,16 while there are signs of improving global conditions, vulnerabilities persist. Most surveyed chief economists (54%) expect economic conditions to hold steady in the short term. However, among those anticipating change, more expect conditions to worsen rather than strengthen. The 2024 economic performance was marked by a global decrease in inflation and an unusually resilient economy throughout the disinflationary process. While easing inflation and looser monetary policy offer some optimism, slow growth and political volatility keep many countries at risk of economic shocks. The International Monetary Fund (IMF) projects growth to hold steady at 3.2 percent in 2025, despite sizable downward growth revisions in a few economies, particularly low-income developing ones.17 Despite this comparatively steady outlook, price pressures persist in many economies. Inflation remains particularly high in services – at almost twice pre-pandemic levels – and is especially persistent in low-income countries. Low-income countries are disproportionately affected by rising inflationary pressures because of elevated food prices due to supply disruptions influenced by climate shocks, regional conflicts and geopolitical tensions.18 Against this backdrop, companies expect economic pressures to be among the most transformative drivers. Figure 1.1 shows rising cost of living remains a top concern, with half of all surveyed employers expecting it to drive transformation, making it the second-most influential trend. Slower economic growth is also a major concern, with 42% of respondents expecting it to impact their operations. Views on the impact of inflation and economic growth notably vary across regions. For example, in Sub-Saharan Africa, six in 10 respondents cite inflation as a key factor, whereas in Eastern and South-Eastern Asia, slower economic growth is seen as the more important issue. Finally, stricter anti-trust and competition regulations, though a lower priority overall, are expected to impact one in six employers globally Geoeconomic fragmentation Intensifying geoeconomic tensions threaten trade and supply chains, with lower-income economies particularly vulnerable, given that essential goods like food and energy comprise a larger share of household expenditures in these countries.19 Globally, governments are responding to geoeconomic challenges by imposing trade and investment restrictions, increasing subsidies, and adjusting industrial policies. The World Trade Organization (WTO) reports that trade restrictions doubled between 2020 and 2024, with the value of import restrictions reaching nearly 10% of global imports in 2024.20 These increasing protectionist measures may pose a medium-term risk to global economic growth, as they reduce opportunities for open innovation and technology transfer – factors that historically fuelled growth in emerging economies during periods of globalization.21 This shift toward geoeconomic fragmentation carries substantial macroeconomic implications, with the IMF estimating potential global output losses from trade fragmentation ranging from 0.2% to 7% of GDP , and losses deepening in scenarios of technological decoupling.22 Emerging and developing economies are particularly vulnerable to such disruptions. For example, Sub-Saharan Africa could see long-term welfare losses of approximately 4% of GDP due to declining global integration.23 The Future of Jobs Survey reveals that around one- third (34%) of surveyed employers see heightened geopolitical tensions and conflicts as a key driver of organizational transformation. Meanwhile just over one-fifth of surveyed organizations identify increased restrictions on trade and investment (23%), as well as subsidies and industrial policies (21%), as factors reshaping their operations. Geoeconomic concerns vary by economy. Employers in Eastern Asia and Northern America identify rising geoeconomic fragmentation as a key driver shaping labour markets, with nearly half of surveyed employers in these regions citing this trend. These regions also show significant concern about restrictions on global trade and investment, though to a lesser extent than in the Middle East and North Africa. Economies with comparatively high trade volumes with the United States, China, or both – such as Singapore (64%) and the Republic of Korea (71%) – tend to expect greater transformation from each of these geoeconomic trends, as shown in Figure 1.3 below. Future of Jobs Report 2025 13