America slips as Europe hold top rank in competitiveness survey
The US, while maintaining its status as the world’s largest economy and as a worldwide innovation powerhouse, slipped further in the Global Competitiveness Report for the fourth consecutive year. The 2012 survey, published by the World Economic Forum, ranks the competitiveness of 144 countries based on over 100 key economic indicators including infrastructure, macroeconomic environment, labor market efficiency and innovation.
The competitiveness report stands as a damning piece of evidence for President Barack Obama, as the political right has frequently criticized him for his handling of the economy. One day before he is set to speak at the Democratic National Convention, Obama has given his opponent, Mitt Romney, a new angle to attack the incumbent’s record from. The election has been the most negative campaign in US history, with negative ads accounting for about 90% of each candidate’s advertisements.
World Economic Forum Lead Economist, Jenifer Blanke states, “there is continuing concern about the macro-economic environment, continuing debt levels – the inability to get the spending under control and really political deadlock about how to even deal with this issue. And, this is leading to concern about political institutions in general. So, the business sector has concerns about its confidence in politicians to make the sorts of decisions that are needed going forward”.
Despite a decline in its overall ranking, the US remains to be one of the world’s top innovators, supported by an ‘excellent’ university system, and continues to offer vast opportunities thanks to the sheer size of its domestic economy.
For the fourth consecutive year, Switzerland is ranked first, due to its notable market efficiency, sophistication of business sector, and its innovative capacity. Switzerland has the highest rates of patents per capita, and its productivity is further enhanced by its business sector offering excellent job training opportunities and labor markets that balance employee protection with the interests of employers.
Including Switzerland, six European countries dominate the top ten ranks, in hand with Hong Kong, Japan, Singapore and the US. It is apparent that northern European countries have strengthened their positions since the financial crisis in 2008. However, the survey found that southern Europe, such as Greece (ranked 96th) continues to suffer from poor access to financing and rigid labor markets.