Seven years after the beginning of the financial crisis, its consequences are still being felt around the world. The recovery has been less robust, more uncertain, and taken longer than many expected, suggesting a “new normal” of low economic growth, low productivity, and high unemployment. Recent shocks—from the crisis in Ukraine to conflicts in the Middle East, terrorism, and the migrant crisis—have added to economic woes.
In the face of such fragile economic recovery and geopolitical turbulence, the analysis in this chapter has demonstrated the importance of competitiveness—understood as the drivers of higher productivity—in supporting growth and economic resilience. The historic proportions of the economic crisis and the relative performance of economies since its onset have shed light on how structural weaknesses can exacerbate shocks and make an economy ill-equipped to respond. The crisis is a forceful reminder that competitiveness matters: countries that were more competitive at the onset of the crisis are those that have weathered the crisis much better. In this context, productivity-enhancing reforms are the only way forward.
Most importantly, we cannot lose sight of the human angle. High unemployment figures are weighing heavily on societies, risking not only prolonged lower demand but also the de-skilling of a significant part of the labor force and growing discontent. Results presented here suggest that leveraging talent is at the heart of a competitive and resilient economy and countries that identify, nurture, use, and reward talent are those that enjoy more robust growth and swifter recovery. This holds even truer in these the post-crisis years, which are coinciding with a fundamental shift away from the traditional manufacturing industry to one where the continuously spreading use of ICTs is giving rise to entirely new and consumption models and industries, while disrupting others. Talent-driven economies are the best equipped to adapt to the changes brought about by this so-called fourth industrial revolution and reap their benefits.
Recovering growth in this unchartered territory will require the recognition that we need a shared assessment and understanding of the future sources of productivity. By reducing complexity and providing a tool to identify strengths and weaknesses and to track progress, the GCI framework serves as a useful means to inform this conversation and support policymakers, businesses, and civil society in their development of a shared long-term vision. Since its introduction in 2005, the GCI has been used by a growing number of countries and institutions to benchmark national competitiveness. It provides a platform for dialogue among government, businesses, and civil society that can serve as a catalyst for productivity-enhancing actions.
Building on the strengths of the GCI as a policy tool, the World Economic Forum is in the process of updating the GCI methodology. The objective is to provide a more refined assessment of the drivers of competitiveness, based on latest research and empirical evidence and using newly available datasets. Chapter 1.2 introduces the conceptual building blocks of the updated GCI framework.