- Australia leads the world in gender education parity
- Australians need to stay in the workforce longer - ranked 84 of 122
- Australia retains a high cost workforce - ranked 96th for pay related productivity
Australia has scraped into the top 20 countries in a new global report, developed by the World Economic Forum in collaboration with Mercer, which measures countries’ ability to develop an effective workforce designed for economic success.
The economic potential of people is one of the most critical drivers of growth in today’s global economy and this new Human Capital Report identifies where the best educated and most productive workforces are being developed.
The report ranks 122 countries representing more than 90% of the world’s population. Each country was measured against 51 factors in four distinct categories: Education; Health and Wellness; Workforce and Employment; and Enabling Environment. Australia came in at 19th overall, 17th within OECD countries and 4th within the Asia Pacific region.
Australia leads the world in terms of gender education parity and achieved a global ranking of 13 for education, largely driven by the quality of management schools and options for professionals seeking further career development.
However, although the nation ranked 19th overall for the Workforce and Employment pillar, we ranked 84th out of 122 on workforce participation for those aged 65 and over and 96th for pay related to productivity. Australia is lagging significantly behind comparable economies such as Singapore (3), the UK (9) and the US (10) in relation to pay related productivity.
“Our incredibly low rankings in relation to keeping older workers in the workforce longer and the cost of reducing relative productivity are serious red flags for Australian employers and the government, said, Garry Adams, Leader of Mercer’s Talent Business, Pacific.
“The Human Capital Index was developed to assist global organisations plan their workforce and make talent investments that will impact business growth and long-term success. Australia continues to be a relatively high cost destination and we face competition from traditional established markets as well as from growth markets in Asia.
“Australia’s inclusion in the top twenty is encouraging but there is more work to do if we are to improve our global standing. Traditional thinking about the workplace – including how jobs, rewards and benefits and retirement are defined – should be continually challenged.
“Understanding and addressing challenges related to human capital is fundamental to short term stability and long term growth for both organisations and nations and a case in point is the need for employers to harness the skills and experience of their workers aged 55 and older to drive increased productivity” said Mr Adams.
According to Saadia Zahidi, Senior Director, Head of the Human Capital project at the World Economic Forum, “Some countries face an aged or ageing population, others face youth bulges, a few even face both. For some, this means confronting a major upcoming talent crunch, while for others it means developing mechanisms that allow it to realise their population’s potential rather than letting it develop into a burden. In this light, the Human Capital Index is a tool for understanding where countries stand today so that government and business can engage in workforce planning for the future.”
The Health and Wellness pillar saw Australia achieve a global ranking of 3 for life expectancy, which was at odds with the ranking of 97 for obesity.
The report shows that advanced Asian economies such as Singapore (3) and Japan (15) had higher overall scores than Australia, as did New Zealand (12), the United Kingdom (8) and the United States (16).
According to the Human Capital Index, countries in Northern and Western Europe account for eight of the ten top positions. Switzerland heads the overall global ranking followed by Finland (2), Netherlands (4), and Sweden (5). Singapore, which ranks in third place, and Canada (10) round out the list. To download the Human Capital Report and country ranking Index, visit www.mercer.com/hcindex
Rankings by region
Aside from those European countries in the top 10, France (21) and Spain (29) received high marks in Health and Wellness, but both countries did less well in their Workforce and Employment ratings. Regardless, both rank ahead of Italy (37), Greece (55), and Serbia (85).
In North America, the United States ranks 16 because of its strong workforce and ability to attract talent. Canada (10) ranks even higher because of its solid rating in Education, where it ranks second in the world. Among Latin American and Caribbean countries, Barbados (26) is the highest-ranked followed by Chile (36) and Panama (42). Mexico ranks 58.
Within Asia, Japan (15) ranks the next-highest after Singapore because of high marks in Health and Wellness and Workforce and Employment. These countries are followed by Malaysia (22) and Korea (23). Both China (43) and India (78) received lower marks in Health and Wellness and Education.
Among the Middle Eastern and African countries, Qatar (18) ranks the highest followed by UAE (24), Israel (25), and Saudi Arabia (39). Other countries ranking favorably include Mauritius (47), Botswana (79), and Kenya (81).
Mercer has worked collaboratively with employers, governments, and academia to ensure workforce potential and drive economic growth. Identifying gaps in necessary skills helps reshape the nature of a specific workforce, compete more successfully for talent, and maintain positioning in global markets. To learn more about some of Mercer’s work in this area, visit http://www.mercer.com/services/talent.html.
Mercer is a global leader in talent, health, retirement and investments. Mercer helps clients around the world advance the health, wealth and performance of their most vital asset – their people. Mercer’s 20,000 employees are based in 43 countries and the firm operates in over 140 countries. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), a global team of professional services companies offering clients advice and solutions in the areas of risk, strategy and human capital. With 55,000 employees worldwide and annual revenue exceeding $12 billion, Marsh & McLennan Companies is also the parent company of Marsh, a global leader in insurance broking and risk management; Guy Carpenter, a global leader in providing risk and reinsurance intermediary services; and Oliver Wyman, a global leader in management consulting. Follow Mercer on Twitter @MercerAU @MercerInsights