The United States faces a daunting challenge in creating jobs: at current rates, it will take until 2016 to replace the 7 million of them lost during the 2008–09 recession. To regain full employment—finding work for the unemployed and accommodating the 15 million Americans expected to enter the labor force this decade—the US economy must create 21 million jobs by 2020.

Only under the most optimistic of three scenarios that the McKinsey Global Institute modeled would this be likely to occur, according to a new MGI report, An economy that works: Job creation and America’s future. The study sheds new light on how companies use labor, where new jobs are likely to come from, and what conditions are needed to ensure that they can be created in a sustainable way. In addition to original research and scenario analysis, the report draws on a survey of 2,000 business leaders, as well as interviews with more than 100 business executives, public-sector leaders, educators, and other experts on US labor markets.