A prior post noted that the global socio-economy is experiencing an unprecedented era of accelerated economic growth and enhanced quality of life. It began roughly 8 generations ago in one corner of Europe and has spread outward to the rest of the world. Growth continues to accelerate and its global reach is relentless. This post focuses on pathways through which it spreads and evolves with the global socio-economy.

An early pathway spreading accelerating socioeconomic growth was simple conquest combined with the European period of global exploration. This led directly to increased European wealth and capital to finance more ambitious ventures and provided the “trade currency” to support expensive trade routes between Europe, Asia and Africa. And eventually the Americas.

Another early pathway was colonialization – people moving from the home country to the New Land resulting in the transfer of human capital and infrastructure to the newly conquered lands. This could be Brutal as pre-existing populations were enslaved, exterminated or displaced to subsistence fringes of the land. The economic outcome as measured for the entire population was amazing, but the price paid was concentrated on a few. The Americas are an example of this pathway.

A third pathway is exploitation and export of in situ natural resources. These natural resources could include but are not limited to energy minerals, precious metals, agricultural and forest products, and so on. These resources could generate fantastic economic rents that flowed out of the region. Exploitation of non-renewable resources with a finite economic lifetime and subject to global competition, fluctuations in supply and wild price fluctuations often contributed to a corrupt culture and Dutch Disease could poison the social structure. On the other hand if the local population could capture a significant share of the economic rents, it could be a critical source of investment financing for local services whether it be human resources of supporting communication and transportation infrastructure.

A newer pathway is off-shoring of certain production activities, usually amongst the lowest value added activities to economies with surplus low-cost labour. This pathway is popularly reported as the loss of manufacturing jobs to over seas countries. This pathway has benefited from low-cost transportation (cheap energy, new business models including super sized ships and all the infrastructure associated with containerization technology). It has provided benefits and costs to both sides of the market but that is a topic for another post. How it balances is a matter of policy choices made by participants.

Another pathway is developing based on an emerging surplus of highly trained labour. India, with its surplus of highly trained labour, may be an early example of this pathway. As a consequence over seas production will include a higher share of the skilled value added activities spurring innovation and new product development. This new business model is sometimes referred to a the production “smile curve”.

The new business model is based on economies with a surplus of highly educated labour creating an incentive for higher education. A fuller discussion of this path as it relates to India is available on YouTube presented by Raghuram Rajan and Rohit Lamba.

The core message of this post is that the global socio-economy is dynamic, has produced wonderous levels of income and increases of the quality of life and continues to innovate and create new ways to spread these benefits. Of course there are costs and there are ways of dealing with the costs if willing.

From ACARA via ChatCPT

As many as 75 percent of global organizations are challenged by talent shortages. Amid this scarcity, India is recognized for its surplus talent in various fields, including information technology, engineering, medicine, finance, and more. In fact, the county is expected to have a skilled talent surplus by 2030, including more than one million highly skilled tech professionals.

What is contributing to the talent surplus?

India has an extensive and expanding talent pool, attributed to several factors, including:

Highly educated workforce: India produces many graduates, including engineers, doctors, and management professionals. Engineering and technology undergraduates had the highest employability rating in 2022 (55 percent).

Large working-age population: Boasting one of the world’s largest working-age populations, 65 percent are under 35 years old.

Technical expertise: A major player in the global IT industry, India is home to many software development and IT services companies, producing many skilled software developers, engineers, and IT professionals.

Cost advantage: India’s labor cost is generally lower than many developed countries and organizations can save up to 40 percent by hiring Indian talent. This makes it an attractive destination for outsourcing and offshoring services, with India being the world’s leading destination with over 60 percent of the global market share.

Diverse skill set: India’s talent pool spans various industries and disciplines. It’s not limited to just IT. Strong healthcare, pharmaceuticals, finance, design, and more sectors also exist.

Innovation and entrepreneurship: India has seen a surge in startups and entrepreneurship, with cities like Bangalore, Mumbai, and Delhi emerging as hubs for innovation and technology.

Strong communication: English is widely spoken and understood in India, making it easier for Indian professionals to communicate and work with global clients and companies.

Availability across time zones: India spans two time zones – India Standard Time (IST) and India Standard Time +5:30 (IST +5:30) for some regions, which includes Sri Lanka. This means that Indian workers can be available at various times of the day and night, making them potentially valuable for businesses that operate on a global scale or require 24/7 coverage.

Global diaspora: The Indian diaspora is spread worldwide, with many individuals holding influential positions in multinational corporations and startups. This network often serves as a bridge for collaborations and investments.

Government initiatives: The Indian government has launched various initiatives to promote skill development and entrepreneurship, such as “Skill India Digital” and “Make in India,” which aim to boost employability and foster innovation.