Germany also ranked sixth last year in the survey conducted by the World Economic Forum (WEF), but for the first time this year, it surpassed the United States, which fell from fifth to seventh place on the list. The report was released Wednesday by the WEF in Geneva.
Switzerland topped the rankings in the global competitiveness report for the fourth consecutive year. Singapore ranked second, with the northern European countries of Finland, Sweden, and the Netherlands rounding out the top five. The United Kingdom ranked just behind the United States in eighth place.
According to the report's authors, the competitiveness rating of the US grew overall, but its spot on the list fell for the fourth year in a row. The reasons were cited as its "burgeoning macroeconomic vulnerabilities," and the institutional environment, "particularly the low public trust in politicians and a perceived lack of government efficiency."
Factors such as poor access to financing and rigid labour markets kept the southern European countries of Portugal (49th), Spain (36th), and Italy (42nd) lower on the list. The country at the centre of the euro crisis, Greece, was ranked 96th of the 144.
Klaus Schwab, founder and executive chairman of the WEF, urged governments to adopt long-term measures to enhance their countries' competitiveness. He said in a statement: "Persisting divides in competitiveness across regions and within regions, particularly in Europe, are at the origin of the turbulence we are experiencing today, and this is jeopardizing our future prosperity.”
Germany received high marks for infrastructure, business sophistication, education and innovation.
But the country ranked near the bottom of the survey when it came to certain labour issues, such as the flexibility of wage determination (139th) and hiring and firing practices (127th).