Australia’s economy is one of the least complex with some of the least entrepreneurial and credible managers in the developed world, according to annual rankings released on Tuesday that also show weak cybersecurity, business investment and workforce productivity indicators.
Strong commodity prices, trade settings and labour market and quality of life measures propped the nation up to 19th overall but the latest results have renewed calls to transform the economy to catchup with Scandinavia and Asia’s world leaders.
The IMD Competitiveness annual rankings were first published in 1989 by the International Institute for Management Development. The Swiss-based university’s rankings are based on economic literature, various IMD sources, and feedback from the business community, government agencies, and academics.
For the fifth year in a row, Australia hovered within the 18-22 range of overall competitiveness placings, which in 2023 ranked 64 countries.
Australia kept its 19th overall position this year, with similar rankings in the subcategories of government efficiency and infrastructure helped by an outsized economic performance of 10th among the ranked countries.
But the business efficiency ranking fell for the second year in a row to 30th, punctuated by a near last spot in the ‘entrepreneurship’ measure.
Based on a survey of how widespread entrepreneurship is across business managers — Australia was ranked 62nd of 64 countries. The credibility of managers was a little better at 46th.
Australia also saw some of its biggest year on year declines in key innovation measures like venture capital and its lowest rankings in economic complexity index (58th) and efficiency of large corporations by global standards (51st).
Other lowlights include cybersecurity (53rd), internet bandwidth speed (49th) graduates in science (44th) and manufacturing wages (56th).
Australia did have the top rankings for terms of trade, country credit rating and environmental agreements, although the latter – a ranking of the fulfilment of multilateral agreements on hazardous waste – may fall as AUKUS progresses.
Other high rankings are the share of the population working (15th), inbound students (2nd) and university education (6th).
Australia has fared better on IMD’s digital specific rankings, including a significant rise last year.
IMD relies on partners around the world for assistance with the rankings, with the Committee for Economic Development of Australia (CEDA) acting as the local partner.
“Strong commodity prices and a healthy jobs market continue to drive Australia’s competitiveness, but we cannot keep relying on our traditional trade strengths,” CEDA chief economist Cassandra Winzar said on Tuesday.
“We must redouble our efforts to deepen the complexity of our economy amid an ongoing slump in productivity.”
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