Press release for media – 8 December, 2022
IMD World Talent Ranking 2022
Press release for media – 8 December, 2022
As talent migration patterns remain unpredictable, governments and businesses attract local and foreign talent by boosting overall appeal of their economies
8 December 2022
Global economies are reassessing the balance between cultivating domestic and international talent, in a bid to compensate for skilled labor losses as a result of travel constraints and lockdowns during the pandemic.
Data from the 2022 IMD World Talent Ranking (WTR), produced by the World Competitiveness Center (WCC), part of the International Institute for Management Development (IMD), shows that pre- and post-pandemic patterns with respect to brain drain have not been as damaging to the talent competitiveness of those countries that have strengthened their appeal.
Saudi Arabia (up eight places since 2021, at 30th) was the economy that improved its appeal to talent most between 2019 and 2022 among the 63 studied, the researchers found. They signaled a decrease in the cost of living, an increase in quality-of-life scores, and ambitious investment plans as the reasons why. The Czech Republic, Croatia, the Slovak Republic, and Mongolia also improved.
Conversely, the US (down two places at 16th), Canada, the UAE, Denmark, New Zealand, Hong Kong, Indonesia, South Africa, and Venezuela display the largest declines in their appeal to talent.
An economy’s appeal to skilled labor was measured by the researchers via factors including but not limited to remuneration, taxes, cost of living, and the education system, as well as the economy’s position on environmental issues and a fair judicial system.
“In the future, national education systems will become less important to determine the quality of the talent pool. This is the result of talent globalization, but also of countries borrowing successful educational policies from others and the resulting race to the top in education. Indirectly, quality of life and economic sustainability will indeed determine the quality of the talent pool as well. There will be winners and losers,” said Professor Arturo Bris, Director of the WCC.
The WTR studies 63 economies by quantifying 31 criteria (a mixture of hard data and survey responses from executives) in order to assesses these countries’ ripeness for fostering long-term value creation for their enterprises and the economy at large, via their workforce.
Overall, Switzerland remains the leader in attracting and retaining talent for the sixth consecutive year, followed by Sweden, Iceland, Norway, then Denmark. Since 2018, Iceland has leapt from 16th to third.
“Talent competitiveness in the post-COVID period hinges greatly on the motivation level of the workforce which, in turn, relies on remuneration but also quality of life and organizational leadership of the economy,” said Christos Cabolis, Chief Economist at the WCC.
Switzerland ranks first in Investment & Development and in Appeal, and second in Readiness. At the indicator level, there are strengths across the board. It is first in the effective implementation of apprenticeships, attracting foreign highly skilled personnel and the availability of finance skills and of managers with international experience. It ranks second in the prioritization of employee training by the private sector, the level of motivation of the labor force and the availability of language skills.
There is, however, room for improvement in quality of education as measured by pupil-teacher ratio which was low, the female labor force (as a percentage of the total labor force), graduates in science, and (despite excellent quality of life performance) exposure to particle pollution, which forms part of the Appeal factor.
Sweden remains in second spot by performing strongly in Appeal (second) and to a lesser extent in Readiness (sixth) and Investment & Development (seventh). It reaches its highest rank at the criteria level in the impact of brain drain and in the exposure to particle pollution, placing second in both.
Iceland moves up to third position (from seventh) mainly due to its performance in the Investment & Development (fourth) and in Appeal (eighth). It ranks 13th in the Readiness factor. Iceland’s strengths include total public expenditure on education (fourth) and expenditure per student (third), as well as the availability of skilled labor and finance skills (third in both) and quality of life (third).
Norway remains in fourth position overall, ranking fifth in Investment & Development, ninth in Appeal and 14th in Readiness. At the indicator level, it ranks first in the availability of skilled labor, second in the availability of finance skills, fourth in the impact of brain drain and fifth in both the total public expenditure on education per student and the pupil-teacher ratio (primary education).
Denmark remains stable in fifth position. It ranks second in Investment & Development and eighth in Readiness but its performance in Appeal is relatively weaker at 17th. It comes first in the prioritization of employee training, the prioritization of talent attraction and retention, worker motivation, brain drain, and the availability of competent senior managers.
Finland improves to the sixth spot from eighth, ranking 11th in Investment & Development, 11th in Appeal, and moving up from fifth to fourth in the Readiness factor. Its overall improvement is due largely to its stronger performance in indicators including in worker motivation (fourth, up from 10th),
Luxembourg declines four places to seventh position dropping across all talent factors. In Investment & Development, it falls to third (from second), in Appeal to fifth (from second) and in Readiness to 25th (from 23rd). Under Investment & Development, Luxembourg experiences a sharp drop in the implementation of apprenticeships (26th from 15th) and the prioritization of employee training (29th from 11th).
Austria drops to eighth position (from sixth) while remaining in sixth spot in Investment & Development, but slightly declining in Appeal to 10th (from eighth) and reading to 15th (from 14th). In Appeal, Austria drops in the prioritization of talent attraction and retention indicator from sixth to 13th, in worker motivation from third to ninth, in attracting overseas highly skilled staff from 18th to 22nd and in the fair implementation of justice from 17th to 23rd.
The Netherlands ranks ninth overall, remaining in the same position as last year. It slightly advances one spot in the Investment & Development factor to 16th and two places in Appeal to third.
Germany also remains in the same position (10th). It drops one place in Investment & Development and two spots in Readiness ranking 12th in both factors. In Appeal, conversely, Germany improves increasing from ninth to the seventh. In Investment & Development, despite ranking second in the implementation of apprenticeships, Germany’s performance in other criteria in the factor is relatively deficient. It ranks 39th in total public expenditure on education, 32nd in pupil-teacher ratio (primary education), 38th pupil-teacher ratio (secondary education) and to a lesser extent in female labor force (28th).
Regional patterns show Western Europe leading across the three factors. Eastern Asian economies perform especially well (second regionally) in the Investment & Development and Readiness factors, testament to the importance that these economies place on education and the development of local talent. North America takes second place in the Appeal factor, outlining the attractiveness of the US and Canada for the international talent pool of highly skilled professionals that the region manages to retain.
South America and Ex-CIS & Central Europe show the lowest performances overall and across the three factors. The former struggles with local talent development and the readiness of its talent pool (Investment & Development, eight; Readiness, eighth) while the latter fails to attract overseas talent to support its economies (Appeal, eighth).
Notes to editors:
This is the ninth edition of the WTR.
The 31 criteria measured are organized into three “factors”: The Investment & Development factor considers the domestic resources committed to cultivate homegrown talent. The Appeal factor evaluates the ability to attract and retain talent from both the international and domestic markets. And the Readiness factor quantifies the quality of the available skills and competencies in the talent pool.
In 2023, the WCC will produce the IMD World Competitiveness Ranking, the IMD World Digital Competitiveness Ranking, the IMD Smart City Index and the Hinrich-IMD Sustainable Trade Index and the IMD World Talent Ranking
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