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Europe is home to nine of the 10 countries best equipped to help employers attract, develop and retain employees and Switzerland tops that list, according to the third annual IMD World Talent Report by the IMD World Competitiveness Center in Lausanne, Switzerland. The center is a part of IMD business school. The center and school are a part of the International Institute for Management.
The research is based on more than two decades' worth of competitiveness-related data and an analysis of 61 countries. Countries were ranked in three areas:
Switzerland, retaining its No. 1 ranking for the third consecutive year.
Denmark, retaining its No. 2 ranking from 2015. This is the third year it has made the top 10 list.
Belgium, returning for its second year to the top 10 list.
Sweden, returning for a third year.
The Netherlands, retaining its No. 5 ranking from 2015; this also is its third year on the list.
Finland, retaining its No. 6 ranking from 2015 and marking its third year in the top 10.
Norway, for a third year.
Austria, joining the list for the first time.
Luxembourg, marking the second year it has made the top 10 list.
Hong Kong, joining the list for the first time.
"The data suggest that countries that achieve a balance between investing in local talent and the ability to attract overseas talent perform consistently well," the report said. In the 2016 rankings, "All of the countries in the top 10, except for Hong Kong, are European, relatively small and with outstanding education systems," said professor Arturo Bris, director of IMD's World Competitiveness Center, in a video."All these countries share very similar attractive indicators: They invest a lot in education. They provide foreign and domestic talent with a very high quality of life, and they provide development opportunities for individuals not only in early ages but during their entire professional careers."
In a news release he noted that "small can be beautiful when it comes to talent management, as it's harder for larger countries to adopt and adapt effective systems." He said he found it "striking" that nearly every Nordic nation ranked in the top 10. He attributed that primarily to their education systems that he said "feed the economy with the required talent." Bris acknowledged that Europe faces challenges, "including poor economic growth, declining momentum and negative expectations." However, he added, "the quality of its education systems and its commitment to developing talent from a very young age to retirement should preserve its long-term competitiveness."[SHRM members-only resource: Country Guides]The U.S. ranked 14th overall, as it did in 2015, although it ranked second for appeal among all countries. Switzerland ranked first for appeal. Venezuela ranked last overall among the 61 countries.The U.S. hasn't been in the top 10 since 2008. Bris cited what he called the U.S.'s "inadequate public investment" in education for its failure to make the top 10. It's a problem also plaguing other countries, such as Qatar, the United Arab Emirates, the United Kingdom and China, he noted. Bris thinks many Nordic countries are on the top 10 list primarily due to having education systems that teach people the skills that businesses seek."Language barriers and a high cost of living mean these countries aren't really big attractors of foreign talent, yet they invest public resources in developing the right competencies," he said in a news release. "The opposite situation applies to many Asian countries. They might be amazing attractors of foreign talent, but they don't invest enough in nurturing local talent."
But Are They Happy?
A separate global study by Universum, a research and consulting firm headquartered in Sweden, found that western European Nordic countries have the most satisfied, loyal workers. In fact, seven of the countries on the World Talent Report top 10 list are among the top 10 of Universum's Global Workforce Happiness Index.
Being able to retain experienced talent is not just a matter of keeping employees satisfied with their jobs; it is also tied to how employees compare to their peers in other organizations, Universum noted in a news release.Employers can use the index to understand the country's culture and determine which aspects of work culture to emphasize in order to attract or retain talent, according to Daniel Eckert, Universum research project manager. Universum conducted the study between September 2015 and September 2016 with more than 200,000 young professionals in 57 markets who had one to eight years of experience. Respondents were young female and male professionals; young professionals with a background in science, technology, engineering and mathematics; and young professionals with a business background."Employee happiness is crucial for retaining good talent as well as having a motivated workforce that delivers great results and continuously innovates. If the young professionals in a market show low levels of discontent, this is a good sign for the economy as a whole," Eckert said in a news release. "However, it's at these times when it's harder to [secure] the best talent from your competitors."In most countries, the main drivers for job change are better compensation and benefits and better opportunities for advancement, he noted. This index scored three factors: employee satisfaction, willingness to recommend the current employer and likelihood of switching jobs in the next two to four years."A striking finding [in this index] is that in the countries where young professionals are less happy, an important driver is professional development and learning opportunities, while in the happier countries, improved work-life balance is a top driver," he said.The top 10 countries on the Global Workforce Happiness Index are:
The United States ranked 36th on the index—behind South Africa and ahead of Kazakhstan. Ghana was ranked the lowest among the 57 countries studied.
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