In this article, we take a look at 20 countries with the most skilled labor forces in the world. If you want to skip our detailed analysis of labor skills, you can directly go to 5 Countries With the Most Skilled Labor Forces in the World.
Skilled Labor – What Does it Entail?
According to the International Labor Organization, characteristics of those performing ‘highly skilled labor’ include tertiary education, possession of knowledge or skills required for complicated tasks, adaptability to technological changes, and creative training. Individuals in leadership or managerial roles, along with those in technical or professional positions, are classified as skilled laborers. Examples of this workforce include electricians, healthcare providers, maintenance personnel, construction workers, and administrators, among others. In short, any role that requires certified training and knowledge can be classified as a skilled role.
READ ALSO: 20 Countries that Use Child Labor or Forced Labor For Goods Production and 15 US States With The Highest Labor Shortages.
Skill Shortage in the United States
Skilled workforces are an indispensable part of every economy; however, countries worldwide are currently undergoing immense skill shortages. This even includes countries with some of the largest labor forces in the world, such as the United States and Germany. According to a 2024 report by the US Chamber of Commerce, there are 8.2 million job openings in the United States right now, but only 7.2 million unemployed individuals. It’s important to note that not all states are equally impacted by worker shortages. In North Dakota, there are 30 available workers for every 100 open jobs, whereas California has 92 available workers for every 100 open jobs. Other states lie somewhere along the middle, such as Arizona, which has 71 available workers for every 100 jobs.
The workforce shortage started during the 2020 pandemic, when millions left the workforce due to forced closures. In 2022 alone, more than 50 million people quit their jobs. Since then, job openings have increased, but so have early retirements, savings, and lesser immigration, which are some of the reasons behind continued worker shortages. While many headlines have referred to these events as ‘The Great Resignation’, the Chamber of Commerce has called it ‘The Great Reshuffle’, because the resignations have been disproportionately distributed amongst various industries. For example, presently, the quit rate for the leisure and hospitality sector is 3.6%, whereas for the financial sector, it is 1.5%. Generally speaking, higher quit rates are expected in industries with lower wages, higher working hours, and a lack of hybrid flexibility, which the pandemic has deemed quite essential.
However, the quit rate alone cannot be utilized to gauge an accurate picture of the labor shortage. Even though the hospitality industry has a high quit rate, it has averaged an even higher hiring rate. Since November 2020, the hiring rate for this industry has stayed between 6% and 19%, whereas the national hiring rate has been 3.7% since January 2024. In January 2024, 781,000 workers quit the hospitality industry, but it hired another 1.05 million people. Currently, the industry has a labor shortage of only 20%. On the other hand, the two industries most affected by labor shortages are financial activities (40%) and professional and business services (45%). Professional and business services include a wide range of occupations, such as legal services, landscaping workers, scientific researchers, and even cleaners.
In stark contrast to this, the US also sees certain industries with a labor surplus, such as the construction sector. In 2023, the industry had an average of 383,917 open vacancies every month, whereas the average monthly number of individuals seeking employment was 480,333. However, this does not necessarily mean that all open positions will be filled, because the construction industry is still facing a labor shortage. In the 2023 Associated General Contractors of America survey, 80% of respondents mentioned having difficulty filling open positions, mainly due to a lack of adequate skills in the available population. Thus, it’s not just a shortage of workers, but rather, a shortage of the right skillsets.
Combatting Skill Shortage
Unfortunately, finding skilled workers is not a simple solution to the present labor shortage, as it comes with several variables. A 2023 Jobber survey of 18-to-20-year-olds in the US revealed that 74% of respondents felt like there was a stigma attached to picking a vocational school over a traditional college degree. 79% of individuals mentioned that their parents wanted them to pursue a college education; however, only 5% stated the same regarding vocational training. This is especially problematic for companies in the manufacturing and construction sectors, which often rely on vocational training for their employee base. In this scenario, businesses need to find other viable solutions rather than waiting around for an adequately skilled workforce.
This is where companies like Rockwell Automation, Inc. (NYSE:ROK) come in, which enable manufacturing clients to use technology as a means of combatting worker shortage. Rockwell Automation, Inc. (NYSE:ROK) provides various digital transformation and automation tools, allowing industry clients to enhance productivity and results. Additionally, they also offer technological solutions in other domains, such as cybersecurity, smart manufacturing, and equipment support. Their solutions have been employed across industries from aerospace and automotive to food and publishing.
In March 2024, Rockwell Automation, Inc. (NYSE:ROK) put out its annual State of Smart Manufacturing Report, in which manufacturers reported that the lack of skilled workforce is one of the biggest reasons holding them back from outdoing their competition. They also stated that the adoption of technology would significantly help them in mitigating internal and external risks. As a result, the overall investment in innovative manufacturing technology saw an increase of 30% from 2023 to 2024. In the survey for this report, 42% of manufacturers said they are addressing the skills gap and labor shortage by increasing automation, 37% said they are introducing AI or machine learning technologies, and 33% said they are using technology to create more engaging jobs.
Furthermore, 43% of manufacturers said that increased automation is the top way they will increase positive business outcomes over the next five years. One example of a business that uses Rockwell’s technology to leverage productivity is Mauser Packaging Solutions, which has been employing Autonomous Mobile Robots (AMRs). An AMR is a robot that can move around and transport materials within a facility without requiring direct input from a handler. This means that it can dodge obstacles on its own and even come up with different pathways independently, without needing a script. Mauser started utilizing AMRs at two of its facilities to move finished goods to the stretch-wrapper. This freed up three laborers who could be moved to higher-value roles, while also allowing the company to increase its throughput by six times. Within Rockwell Automation, Inc. (NYSE:ROK), AMRs are supplied by OTTO Motors, a subsidiary that the company acquired in 2023.
While we acknowledge the potential of ROK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Now that we have examined the overall shortage of skilled labor in the United States, let’s take a look at 20 countries with the most skilled labor forces in the world.
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Our Methodology
To formulate this list of 20 countries with the most skilled labor forces in the world, we utilized the 2024 World Competitiveness Yearbook by the International Institute for Management Development (IMD). This report measures competitiveness across 63 countries using 340 different criteria, one of which focuses on the presence of a skilled workforce.
The data for this metric is sourced through IMD’s Executive Opinion Survey, the respondents of which are mid and upper-level managers from these countries. For this metric, the respondents were asked to answer on a scale of one to six whether they had access to skilled labor. The average value of all the responses is calculated and converted into a scale from 0 to 10. The countries are ranked in ascending order based on these average values.
Note: We have excluded Israel from our rankings due to the ongoing geopolitical conflict in the country, which paints a rather uncertain picture regarding the future of the workforce.
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20 Countries With the Most Skilled Labor Forces in the World
20. Nigeria
Availability of Skilled Labor: 6.20
In the Executive Opinion Survey, 70.4% of Nigerian respondents picked the presence of a skilled workforce as one of the most attractive factors of their economy, which put this indicator above all others in the country. Despite the low quantity of the labor force being a weakness for the Nigerian economy, skilled labor is one of the country’s top strengths.
19. Qatar
Availability of Skilled Labor: 6.20
Only 35.3% of Qatar-based respondents picked a skilled workforce as one of the most attractive features of their economy. However, Qatar still ranks 19th on our list of countries with the most skilled labor forces in the world.
18. Kazakhstan
Availability of Skilled Labor: 6.21
In Kazakhstan, 37.3% of respondents believe that having a skilled workforce is one of the top attractive features of their economy. The country also has several other strengths that improve its business efficiency, such as an immense use of big data and analytics, a statutory minimum wage, a high number of women in management, and beneficial employee training.
17. Botswana
Availability of Skilled Labor: 6.25
Botswana is currently struggling with a high level of youth unemployment, which stands at 34.4%. However, the country still has one of the most skilled labor forces in the world, with 58.7% of respondents considering this to be one of the most attractive aspects of its economy. According to the IMD report, the country also has a high ratio of foreign highly skilled talent, but attracting and retaining talent is one of its business weaknesses.
16. Canada
Availability of Skilled Labor: 6.33
Skilled labor tops the list of attractive indicators for the Canadian economy, with 55.1% of respondents selecting it as one of the most attractive features of the economy. This is also one of the top business strengths for the country, along with labor productivity and stock market capitalization.
15. Ireland
Availability of Skilled Labor: 6.38
An overwhelming 81.3% of Ireland-based survey respondents picked skilled labor force as one of the most attractive aspects of the Irish economy. Ireland ranks at the top in several business efficiency-related criteria, including talent retention, adaptability, workforce productivity, and national culture.
14. India
Availability of Skilled Labor: 6.42
India ranks 14th on our list of countries with the most skilled labor forces globally, with this being one of the top business strengths for the country. However, the IMD report states that developing a skilled workforce is still one of the biggest challenges for the country in 2024, which means there is a gap to be filled.
13. Indonesia
Availability of Skilled Labor: 6.50
Only 20.7% of Indonesian respondents believed that a skilled workforce was one of the most attractive factors in their economy, but the country ranks 13th on our list of nations with the most skilled labor forces around the globe. Other business strengths in Indonesia include competent senior managers, customer satisfaction, and the use of big data.
12. Philippines
Availability of Skilled Labor: 6.51
Of all the respondents from the Philippines, 82.3% believe that the availability of a skilled workforce is one of the most appealing aspects of the country’s economy. In addition to skilled labor, other business strengths of the Philippines include the credibility of managers, a high number of women in management, and good compensation levels.
11. Jordan
Availability of Skilled Labor: 6.54
The IMD report noted a decline in the number of qualified engineers and technological skills in Jordan from 2023 to 2024. However, the country still ranks number 11th on our list of countries with the most skilled labor forces in the world.
10. Switzerland
Availability of Skilled Labor: 6.58
One of Switzerland’s biggest strengths is the presence of foreign highly-skilled personnel, which is why it is one of the countries with the most skilled labor forces in the world. 53.7% of Swiss survey respondents listed skilled labor as one of the most attractive aspects of their economy.
9. Finland
Availability of Skilled Labor: 6.62
The IMD report lists skilled labor as one of Finland’s top business strengths, and 73.4% of survey respondents agree. However, further improving access to a skilled workforce is also one of the biggest challenges facing the country in 2024.
8. Sweden
Availability of Skilled Labor: 6.62
Sweden ranks eighth on our list of countries with the most skilled labor forces in the world, and that is not only due to its business efficiency. The country also has infrastructural strengths such as a high number of researchers, massive expenditures in research and development, high development and application of technology, and a large number of patents per capita.
7. Iceland
Availability of Skilled Labor: 6.65
Not only does Iceland have one of the most skilled labor forces in the world, but the IMD report also notes several other business strengths for the country, such as its accounting and auditing practices, agility of companies, and digital transformation in companies.
6. UAE
Availability of Skilled Labor: 6.80
The UAE ranks sixth on our list, with skilled labor being one of its most prominent business strengths for the year 2024. Other business-related aspects that are looking up for the country include venture capital, foreign labor force, and early-stage entrepreneurial activity.
5. China
Availability of Skilled Labor: 6.80
In total, 51% of Chinese respondents felt that the country’s skilled labor force is one of the most attractive features of its economy. The country also has a high level of worker motivation and workforce productivity, both of which enhance its business landscape.
4. Bahrain
Availability of Skilled Labor: 6.94
Bahrain ranks 4th on our list of countries with the most skilled labor forces in the world, with 58.1% of survey respondents considering this to be the most attractive feature of the economy. Along with skilled labor, other business strengths for the country include finance skills and regulatory compliance.
3. Denmark
Availability of Skilled Labor: 7.04
According to the IMD report, one of Denmark’s most enormous challenges for 2024 will be strengthening access to qualified labor in the labor market. Currently, Denmark ranks third on our list of countries with the most skilled labor forces in the world
2. Norway
Availability of Skilled Labor: 7.17
Only 48.8% of Norway-based respondents felt that a skilled labor force was one of the most attractive aspects of their economy; however, this continues to be one of the biggest business efficiency strengths for the country.
1. Singapore
Availability of Skilled Labor: 7.94
Singapore ranks number one on our list of countries with the most skilled labor forces in the world. This is also one of the indicators that Singapore saw the biggest improvement in from 2023 to 2024. In the 2023 World Competitiveness Yearbook, Singapore had a score of 6.44 in this metric, which rose to 7.94 by 2024.
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Disclosure: None. This article is originally published on Insider Monkey.
