Is the world economy’s current, long-running upturn running out of steam? Jittery financial markets that have struggled to regain a firm footing since February’s sell-off, anxieties over the US-China trade tariffs confrontation, and now a spate of weaker data for some major economies have all sparked concern over whether the global economy’s expansion may be stuttering or at risk.

Over the next decade, a great wave of technological change will wash through the economy, transforming the nature of work and the shape of the labour market. In a recent study we carried out in partnership with Cisco, we built a brand-new modelling framework to explore the implications of this change in a more comprehensive way than ever before. We simulated the real-world dynamics of technological change and its interaction with the labour market and found that 6.5 million US workers will have to seek out a new profession over the next decade.

But what significance does that number have? Our bottom-up approach to understanding the evolution of the labour market around this technology trend enables us to identify what needs to be done to meet the needs of the future economy. After all, at the macroeconomic level, our ability to take advantage of the opportunities technology presents will be defined by how smoothly those 6.5 million workers make the transition from the old to the new.

Here are our seven key implications for the future of work:

Chinese consumer market to overtake America’s by 2034

“Let China sleep, for when she wakes, she will shake the world.” The cautionary words of Napoleon have echoed ever more powerfully as China’s economic and political power has burgeoned over recent decades.

And with the seismic impact of the world’s most populous nation set to resonate ever more strongly than ever in coming years, in few areas of life will those reverberations be felt more than in the rise of China’s consumers as a global force.

As winter turns to spring, around the world investors are anxiously watching the present spasm in global equities and bonds and asking themselves whether the bears of the financial markets are finally waking from a long hibernation.

We think not. To us, a correction of the sort seen in recent days was overdue and a jump in volatility along with this sort of adjustment in equity valuations was just a matter of time. The pretext and triggers were, and remain, less important – stretched valuations in equities often find their own triggers for such an upset.

Companies’ spirits boosted by buoyant world trade and US fiscal stimulus measures as fears over North Korea tensions and China slowdown retreat

Businesses are increasingly positive about prospects for the world economy, with optimism over the global outlook at its strongest for two years, according to Oxford Economics’ latest survey of global risk perceptions among clients and business contacts, including some of the world’s largest companies.

How our EPRE risk tool helps keep users on their guard in a volatile world

The upsets and surprises of the past 12 months show all too clearly how, in an ever more unpredictable world, risk can catch out the unwary. And, as we begin 2018, nowhere is this more apparent than in the realms of economic and political risk.

As one of the world’s foremost independent economic forecasters, Oxford Economics has collaborated in a joint venture with Control Risks, the global specialist in political and security risks, to create a unique tool for organisations to weigh-up the uncertainties lurking in every corner of a volatile globe.

China’s cities’ GDP to double, and will outstrip Europe’s and North America’s by 2035. But New York, Tokyo, London and LA to stay as world’s urban superpowers as Shanghai closes in.

The world is ever more urban. The top 780 global cities already produce almost 60 per cent of all world economic activity, and they are set grow in importance as urbanisation continues.

By 2035, these cities will be home to almost half a billion additional people with their GDP rising by $32 trillion (constant 2015 prices and exchange rates).

In our latest forecasts, we see world GDP growth accelerating from 2.9% this year to 3.2% in 2018. This would mark the best year for the world economy since the rebound from the global financial crisis began.

It is plausible that recent low volatility is the new and persistent norm, with economic surprises muted and downside risks in decline.

As a tempestuous year in world politics comes to an unnerving close, in economics the nervousness flows from an almost entirely and strangely opposite cause. 2017 ends as the year of the risk conundrum.

Even as the advent of the Trump Administration, the UK’s great Brexit gamble, and the rise of populism and separatist tendencies in parts of Europe have raised the global political stakes, in the global economy both macro and market volatility have recently plummeted. Conditions, in fact, appear more stable than during the period of the Nineties and early 2000s, which itself became known as the ‘Great Stability.

The UK launched its Industrial Strategy yesterday, seeking to tackle the UK’s pervasive slow productivity growth. Developing technical skills is one of the key recommendations, through increasing teaching of STEM subjects, enhanced Computer Science education and “T levels,” the establishment of a National Centre for Computing Education and an Institute for Coding.  Coincidentally, last week BT and Accenture launched their study “Tech know-how: The new way to get ahead for the next generation.” Though they both seem on the same page in promoting tackling technology skills shortages, there are important differences in emphasis.

Lost amid Europe’s political drama and recurrent euro doomsday scenarios is the fact that the Eurozone economy has a business cycle that is alive and well.

Our analysis suggests there is plenty of room left in the current expansionary cycle, which could see the single currency area enjoy a golden decade of economic growth. 

More than four years into the current upturn, most indicators signal the Eurozone economy is still somewhere around mid-cycle, suggesting that – absent an unexpected shock – we should see several more years of sustained expansion. 

One reason is that the amount of economic slack in the Eurozone countries –  the size of the “output gap” before an economy hits a ‘speed limit’ above which growth comes with inflation – may be larger than commonly accepted. 

Economy would be 2% smaller than otherwise expected by end of 2020 - equivalent to a £16bn hit to GDP

With Theresa May’s UK Government struggling to make progress in ‘Brexit’ negotiations with the EU and strike a deal for Britain to leave the bloc, Oxford Economics analysed the potential impact of the talks collapsing with no agreement.

Businesses remain fearful over risks of major economic upsets that could trigger a global slowdown - despite the present upswing in world growth, according to our latest quarterly survey of global corporate risk perceptions.  Business fears over tensions between the US and North Korean and over potential US policy errors emanating from the Trump Administration have persisted since the summer, even as world growth has strengthened.

Equity earnings cycles to power ahead – especially in underperforming Europe and EM markets

The world economy is evidently in the midst of what many are calling a synchronised upswing in growth. A strong rebound in manufacturing, led by Europe, appears to be at the heart of the resurgence. And the pace of expansion has accelerated in recent months. This environment is fundamentally conducive to outperformance by assets leveraged to global growth.

Investors have now been uneasy for many months that in some key global equity markets, shares are becoming overvalued, with share prices relative to corporate earnings – P/E ratios ¬– stretched, especially in the United States.

But our analysis concludes that equity earnings cycles, especially in underperforming markets in Europe and emerging markets (EM), should continue to power ahead for some time.

Ten years on from the global financial crisis, and eyes are peeled for triggers for a new world economic upheaval.  And chief among the prime suspects is debt, and especially household debt.

Last month, the International Monetary Fund highlighted the danger from big increases in both the level of household debt and the pace at which it is rising in many key economies.  “Higher household debt is associated with a greater probability of a banking crisis, especially when debt is already high, and with greater risk of declines in bank equity prices,” the Fund warned in its influential Global Financial Stability Report.

Building on the IMF’s analysis, Oxford Economics has put the debt bogeyman under the spotlight.

We investigated just how great the risks really are, and just where they may lie, country by country, creating a global risk map to identify the debt danger zones to the world economy.  This goes beyond the Fund’s study which while looking at 80 economies and across 25 years of data stopped short of naming the countries where the risks loom largest.