World Economic Forum Global Competitiveness Report 2011-2012

The United States once again found itself slipping on  the list of the world’s most competitive economies, compiled by the World Economic Forum. The United States fell one spot to #5 on this year’s rankings, after dropping two spots to #4 last year.  The Global Competitiveness Report of 2011-2012 ranked a record 142 countries on “twelve pillars of economic competitiveness,” which included metrics on institutions, infrastructure,  macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market development, technological readiness, market size, business sophistication, and innovation.

In the report, Singapore took the top spot, with countries from Northern and Western Europe dominating much of the top ten.  The United States and Japan filled out the highest positions ranking 5th and 9th respectively.   Emerging economies also continued to climb the list – notably China, South Africa, and Brazil – as “competitiveness in advanced economies has stagnated over the past seven years.”

For the United States, there was both good news and bad news coming out of the report.  As expected, the United States received high rankings in technology, innovation, and business sophistication, highlighting its status as one of the world’s most advanced economies.  It also ranked high in what the Report calls “Efficiency enhancers,” which are factors that aid in the continued development of more advanced societies.  The United States was ranked near the top for the quality of its research, tertiary education enrollment, university-industry collaboration, and its investment in workers.  Despite this, the report shows that the United States had trouble with the basics, ranking in the middle of pack on healthcare, primary education, and a solid macroeconomic environment.  In addition, the Report noted that “aspects of the United States’ institutional environment continue to raise concern among business leaders, particularly relating to low public trust in politicians and concerns about government efficiency.” In reference to trust and faith in the government, the United States ranked number 50, astonishingly behind countries such as Syria and Iran. Interestingly, the Report shows that much of what ails the economy seems to be much more structural than cyclical.

Posted by: Brian Gowen

Sources: World Economic Forum

Photo Credit: Global Competitiveness Report 2011-2012 courtesy of flickr user World Economic Forum

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