1

J U N E 2010

m c k i n s e y g l o b a l i n s t i t u t e

How US multinationals drive

economic growth

As one of the primary sources of economic growth, US multinational

corporations could provide insights into how to sustain the US
economy over the long term.
 2

US multinational companies contribute disproportionately to private-sector real

GDP growth (or value added) and labor productivity. The record of these companies
on employment growth across sectors and business cycles is mixed, however. These
are the conclusions from a new McKinsey Global Institute (MGI) report, Growth and
competitiveness in the United States: The role of its multinational companies. With
the US economic recovery underway, government and business leaders are seeking to
identify and nurture future sources of economic growth. In this report, MGI examines the
contributions of US multinational corporations and the shifting global landscape in which
they make decisions about where to participate and invest.

While other researchers have analyzed narrower aspects of US multinational activity, this
report provides a more complete picture by detailing this segment’s share of a range of
measures linked directly to US economic growth and performance (exhibit). For the report,
which compares the contributions of US multinationals with overall economic activity by
sector and over time, MGI analyzed data, reviewed academic literature, drew on its prior
research
MGI 2010on sector competitiveness, and interviewed senior executives from 26 of the
largest and most
Multinational well-known
companies US multinationals.
teaser
Exhibit 1 of 1

Exhibit
US multinational companies contribute disproportionately to
several aspects of US economic activity
% US multinational companies All other US companies

Key indicators, Share of total

2007 private-sector GDP 23 77

Employment 19 81

Exports 48 52

Imports 37 63
Trade deficit 22 78
Private-sector R&D 74 26
Globally competitive
44 56
sectors

Compound annual growth

rate (CAGR), 1990–2007

Contributions Labor productivity 41 59 3.6 1.5

to growth,
1990–2007 Real private-
31 69 4.5 2.9
sector GDP
Employment 11 89 0.7 1.5

Related thinking
“Don’t blame trade for
US job losses”
“The power of productivity”
“The truth about foreign
direct investment in
emerging markets”
“Exploding the myths of
offshoring”
3
In 2007, US multinationals accounted for 23 percent of US private-sector GDP (or value
added). Since 1990, however, they have been responsible for 31 percent of the growth in
real GDP and 41 percent of gains in US labor productivity. Their outsized contributions
to productivity growth matter greatly because productivity increases have delivered
nearly three-quarters of US real GDP growth since 2000, with the rest coming from
employment gains—the reverse of the situation 30 years ago. Compared with other US
companies, US multinationals are twice as concentrated in globally competitive sectors.
Since many corporations confront similar pressures and choices, US multinationals may
provide insights into how other companies—and the economy as a whole—can respond to
increasingly intense global competition.
To read an executive summary or download the full report, visit mckinsey.com/mgi.
Copyright © 2010 McKinsey & Company. All rights reserved.