PH moves a notch to 48th in global talent ranking, poor education cited

Published November 12, 2020, 4:59 PM

by Bernie Cahiles-Magkilat

The Philippines moved up a notch to 48th in the latest global talent ranking where the country was shown scoring the worst performance in most subfactors related to investments and development in the education sector.

Now on its 7th edition, the annual Talent Ranking Report 2020 by the Institute for Management Development’s World Competitiveness Center measures talent in economies based on three factors — Investment & Development factor measures the resources earmarked to cultivate a homegrown workforce; the Appeal factor evaluates the extent to which an economy attracts foreign and retains local talent; and the Readiness factor that measures the quality of the skills and competencies that are available in a country’s talent pool.

This year’s report emphasizes that the quality and readiness of workforce across borders are expected to play a key role in the post-COVID economic recovery.

 For the Philippines, the report showed that the country performs poorly in the Investment & Development factor, ranking 61st out of 63 countries. This is due to low ranks in most subfactors, with those related to education showing the worst performance.

 The Philippines’ performance in the Readiness factor also decreased by 7 spots to 33rd. This indicates the increase in Philippines’s ranking is due to a worse performance by other countries.  In addition, the

Philippines’s Appeal factor, at 31st overall, shows little change.

The country, however, performs well in the personal income tax and cost-of-living subfactors, and shows an increase in the worker motivation subfactor. In the Readiness factor, Philippines’s labor force growth (ranked 3rd globally), availability of skilled labor, and graduates in sciences subfactors perform well.

However, a large drop in the skilled labor subfactor, low ranking in Programme for International Student Assessment (PISA) score subfactor, and small drops in most subfactors culminate in a Readiness ranking of 33rd.

Released on December 3, 2019, the latest PISA results revealed that the Philippines scored 353 in mathematics, 357 in science, and 340 in reading, all below the average of participating Organization for Economic Co-operation and Development (OECD) countries.

IMD further explained that the poor performance in the Investment and Development factor means that the Philippines underperformed in educational investments and in developing local highly-skilled workforce for the private sector compared to the other 62 economies included in the World Talent Ranking 2020. Total Public Expenditure in education as of GDP (50th) and the quality of education in primary and secondary education (i.e., Pupil-teacher ratios, 59th and 57th respectively) are among the indicators in this area with the most room for improvement.

“The decline in the Readiness factor compared to 2019 is mostly driven by the 58th position out of 63 in the educational assessment tests (PISA) and by increasing concerns among the executives we surveyed in the Philippines on issues related to the availability of highly-skilled professionals in the job market as well as a low level of international experience among managers,” IMD said in an email interview.

The country’s overall improvement by one rank higher to 48th was a result of a combination of a decline in the Readiness factor and a stable performance in the Investment & Development factor from last year, while showing small improvements in a number of indicators, such as worker motivation and brain drain.

“The country’s most significant improvement is in labor force growth, where it now holds the third rank overall. These results in the context of a difficult talent economy, allowed the country to improve its ranking in comparison with other countries that presented a lower performance compared to last year. The Philippines will need to leverage its comparative advantages in order to continue their increasing competitiveness for talent,” IMD further explained.

The Philippines talent global ranking has been erratic over the past five surveys. The country ranked 55th in 2016 and jumped to 45th in 2017 but was backed to 55th in 2018 before recovering to 49th in 2019 and to 48th this year.

For the Asia Pacific, the survey said the region has been relatively stable in the last few years, with improvements from Singapore and the Philippines and small declines from Malaysia, Thailand, and Indonesia.

At the factor level Singapore (1st) and Malaysia (18th) have a clear strength in Readiness, Thailand (28th) and Indonesia (32nd) in Appeal while Philippines performs in both Readiness and Appeal (31st and 33 respectively).

The economies perform relatively poorly in the Investment & Development factor. Indonesia (52nd), Malaysia (34th), Philippines (61st), Thailand (51st), and Singapore (21st). Within this factor, the survey results noted that all countries show a slow increase in female participation in the labor force over the last few years; but they still perform poorly relative to other economies. Only Singapore (28th) and Thailand (34th)  are above the mid-50’s for this subfactor. With the exception of Singapore, total public expenditure on education per student is quite low. With the exception of Malaysia the region also performs low in pupil-teacher ratios.

This poor performance in Investment and Development impacts the Readiness factor, as reflected in the correspondingly low PISA educational assessment scores. Singapore is the exception, scoring highly in both expenditure and PISA scores. Over the last few years Philippines, Indonesia, Malaysia all show high labor force growth, while Thailand and Singapore do not.

Under Appeal we note that the region is attractive to foreign labor. Singapore (5th), Philippines (37th), Malaysia (25th), Thailand (16th), Indonesia (24th). However, no country in the region performs high in regard to exposure to particle emissions, which measures air pollution. (Malaysia in 29th performs best in this criterion.) The high air pollution, relative to other countries, may impact further improvements in the Appeal of the region.

All of the top five economies in the IMD World Talent Ranking 2020 — Switzerland, Denmark, Luxembourg, Iceland and Sweden — have excellent education systems, and therefore rank highly (#1-4, & #7, respectively) in the Investment & Development factor.

Overall, countries in Western Europe remain, on average, the most talent-competitive in the world.

In the 2020 ranking, different criteria capture the quality of education at each key stepping stone: primary, secondary and tertiary.

Eight out of the 10 top economies are European and this is down to good quality education, but also mobility. Proof of that, the authors say, is the mediocre ranking that the UK shows this year (#23), below Germany (#11), Belgium (#16) and Ireland (#18), for example.

All of the top five economies in the IMD World Talent Ranking 2020 — Switzerland, Denmark, Luxembourg, Iceland, and Sweden — have excellent education systems for their own home-grown talent, but other nations (e.g. Canada, Singapore, the UAE and Australia) have made significant leaps in the ranking this year.