Global Competitiveness Report 2010-2011

Posted on September 09, 2010 11:03 AM

As news of Malaysia slipping two places to rank 26 in Global Competitiveness Report (GCR) 2010-2011 which was released at the World Economic Forum (WEF) in Tianjin, China today (9 September), among the concerns raised were higher education, institutions and labour market efficiency.

These concerns are represented in the 12 pillars that the GCR uses to assess the competitiveness of each country.

They are institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market sophistication, technological readiness, market size, business sophistication and innovation.

The GCR considers quality higher education and training as crucial for economies that want to move up the value chain beyond simple production processes and products.

It believes that today’s globalising economy requires countries to nurture pools of well-educated workers who are able to adapt rapidly to their changing environment and the evolving needs of the production system.

Under its higher education and training pillar, the GCR measures secondary and tertiary enrollment rates as well as the quality of education as evaluated by the business community.

According to the report, “The extent of staff training is also taken into consideration because of the importance of vocational and continuous on-the-job training—which is neglected in many economies—for ensuring a constant upgrading of workers’ skills.”

Also of importance in assessing a country’s competitiveness is the efficiency and flexibility of its labour market, which the GCR says are critical in ensuring that workers are allocated to their most efficient use in the economy and provided with incentives to give their best effort in their jobs.

“Labour markets must, therefore, have the flexibility to shift workers from one economic activity to another rapidly and at low cost, and to allow for wage fluctuations without much social disruption.”

It adds, “Efficient labour markets must also ensure a clear relationship between worker incentives and their efforts, as well as equity in the business environment between women and men.”

Among the 22 Asia Pacific countries, Malaysia was ranked eighth ahead of China, Thailand, India, Indonesia, the Philippines and Pakistan.

The Geneva-based WEF reportedly used 30% statistical data and 70% from survey data gleaned from 110 company executives in Malaysia between February and April this year.

Malaysia was also assessed unfavourably in terms of technological readiness, with Internet users at 57.6 per 100 population and broadband Internet subscribers at 6.1 per 100 population.