US Falls in Global Competitiveness Rankings
The World Economic Forum’s Global Competitiveness Report 2009-2010, an assessment of the productive potential of nations worldwide, is now available. Switzerland tops the overall competitiveness rankings, followed by the United States. The U.S. fell to second position after several years at the top of the rankings. Singapore, Sweden and Denmark complete the list of the top five countries.
The World Economic Forum defines competitiveness as the set of institutions, policies, and factors that determine the level of productivity of a country. Competitiveness is a complex phenomenon, resting on twelve interrelated pillars:
3. Macroeconomic stability
4. Health and primary education
5. Higher education and training
6. Goods market efficiency
7. Labor market efficiency
8. Financial market sophistication
9. Technological readiness
10. Market size
11. Business sophistication
Is the United States losing its competitive edge? Its competitiveness score fell from 5.74 in 2008 to 5.59 this year. The country’s strengths in the technological and market efficiency areas explain the country’s overall high rank (the U.S. ranks 1st in the innovation pillar and other competitive indicators). Yet, according to the report, “a number of weaknesses particularly related to public and private institutions, as well as continuing burgeoning macroeconomic imbalances, have somewhat eroded the country’s overall competitiveness potential over the past years.”
Since 2005, the World Economic Forum has based its competitiveness analysis on the Global Competitiveness Index (GCI), a comprehensive index, which captures the microeconomic and macroeconomic foundations of national competitiveness. Data sources include both publicly available data and the Executive Opinion Survey, an annual survey conducted by the World Economic Forum together with its network of research institutes and business organizations in the 133 countries covered in the report. The report contains a detailed profile for each of these economies as well as data tables with global rankings covering over 100 indicators.
The authors of the report call for “not losing sight of long-term competitiveness fundamentals amid short-term urgencies.”
You can access the report and rankings, and view interviews with the reports’ co-authors, here.