Competitiveness Survey: U.S. Slides from 1st to 6th

The World Economic Forum, an institute based in Switzerland, has released its annual report on worldwide competitiveness, and it found that the United States has slipped from the top slot last year to the sixth due to less-than-impressive public-finance scores, The Wall Street Journal reports.

The group also said that the United States’ massive budget deficit could continue to cut away at the competitiveness of the country’s economy, according to the Journal.

The group’s Global Competitiveness Report provides rankings of countries based on a number of factors like macroeconomic policies, the regulation of markets, developments in technology, academic institutes and public institutions, among others, and the World Economic Forum says those criteria are indictors of a county’s productivity and potential future economic growth, the Journal reports.  Scores in the above mentioned categories are then combined with the results of a survey of business executives to determine final scores, according to the Journal.

This year, the Forum gave Switzerland the top slot due to the country’s effective public administration and market flexibility, the Journal reports.

“The U.S. remains a very competitive economy,” said Augusto Lopez-Claros, chief economist with the Forum, according to the Journal.  “It leads in innovation and patent registrations, has some of the best universities in the world, and it has extremely high level of collaboration between universities and industry.  However, how you manage your public finances is very important.”

The United States’ budget deficits have sparked an increase in public debt and more government dollars are therefore dedicated to debt service instead of to infrastructure or schools, the Journal reports.

Rapidly growing economies like those in India, China and Russia received middle-of-the-road scores, according to the Journal.  Of the 125 countries included in the Forum’s report, India took the 43rd slot, China took 54th and Russia was ranked 62nd, the Journal reports.

According to the Journal, the top 15 countries ranked by the Forum are as follows:

1. Switzerland

2. Finland

3. Sweden

4. Denmark

5. Singapore

6. U.S.

7. Japan

8. Germany

9. Netherlands

10. U.K

11. Hong Kong

12. Norway

13. Taiwan, China

14. Iceland

15. Israel

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