The Future of Industrial Strategies: Five Grand Challenges for Resilient Manufacturing

The report identifies three global megatrends—geopolitical tensions, technological innovations, and climate change—that are disrupting global value chains. To address these, it outlines five grand challenges: decarbonizing operations, enhancing supply chain resilience, accelerating technology adoption, securing the future workforce, and linking business values with social and environmental responsibility. The document argues that overcoming these challenges requires deep collaboration between governments and the private sector to move beyond short-term adaptation toward long-term industrial transformation.

• Three global megatrends—emerging technologies, climate change, and geopolitical tensions—are driving frequent disruptions that force manufacturing systems to undergo both short-term adaptation and long-term transformation.
• Decarbonizing the industrial sector is particularly complex because heavy industry operations often require high temperatures currently only achievable through fossil fuels, and key assets like cement kilns and blast furnaces have long operational lives of 30-40 years.
• To limit global warming to 1.5°C, the industrial sector must substitute fossil fuels and increase the share of electricity in its final energy demand to 35% by 2030, 40-45% by 2040, and 50-55% by 2050.
• Chemicals, steel, and cement are the most critical industries for decarbonization, as they collectively account for approximately 70% of industrial CO2 emissions and nearly 60% of industrial energy consumption.
• Traditional lean manufacturing and just-in-time production models, while efficient for cost reduction, have left supply chains highly vulnerable to disruptions, as evidenced by shortages of semiconductors, medical supplies, and critical minerals during the COVID-19 pandemic.
• A significant gap exists in technology deployment: over 60% of urgently needed climate mitigation relies on technologies not yet available at scale, such as direct air capture, hydrogen electrolysers, and advanced batteries.
• The manufacturing workforce faces a skills gap where new technologies demand multidisciplinary competencies in software, electronics, and mechanics, alongside a need to overcome outdated public perceptions of manufacturing as dangerous or low-paid labour.
• Industrial safety remains a critical global issue, with inadequate safety measures and hazardous environments causing nearly 3 million deaths annually and resulting in a loss of roughly 3.9% of annual global GDP.

APA

World Economic Forum (2023). The Future of Industrial Strategies: Five Grand Challenges for Resilient Manufacturing. https://www3.weforum.org/docs/WEF_The_Future_of_Industrial_Strategies_2023.pdf

Chicago

World Economic Forum. The Future of Industrial Strategies: Five Grand Challenges for Resilient Manufacturing. 2023. https://www3.weforum.org/docs/WEF_The_Future_of_Industrial_Strategies_2023.pdf.

Wikipedia

{{cite report |author=World Economic Forum |title=The Future of Industrial Strategies: Five Grand Challenges for Resilient Manufacturing |date=January 2023 |url=https://www3.weforum.org/docs/WEF_The_Future_of_Industrial_Strategies_2023.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldeconomicforum2023future, author = {{World Economic Forum}}, title = {{The Future of Industrial Strategies: Five Grand Challenges for Resilient Manufacturing}}, institution = {World Economic Forum}, year = {2023}, month = jan, url = {https://www3.weforum.org/docs/WEF_The_Future_of_Industrial_Strategies_2023.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }