By Elijah Joseph C. Tubayan
THE PHILIPPINES’ ability to develop, attract and retain highly skilled professionals worsened in 2018 due to a persistent job-skills mismatch despite increasing investments in education, according to the annual survey of Switzerland-based business school International Institute for Management Development’s (IMD) research arm.
The Philippines placed 55th out of 63 economies in the IMD World Competitiveness Center’s World Talent Ranking 2018 report published on Tuesday, down 10 rungs from 45th in 2017.
IMD World Talent Ranking 2018
The study takes into account three main factors to determine countries’ ranking. The investment and development factor measures resources used to cultivate homegrown human capital, the appeal factor evaluates the extent to which a country attracts and retains foreign and local talent, while the readiness factor looks at the quality of skills and competencies of a country’s labor force.
The report attributed the Philippines’ fall in rank to the “sharp drop” in the readiness category to the 37th rank in 2018 from 11th last year.
“This change is driven by a marked deterioration in every criterion related to the business community’s perceptions on the quality of education, as well as a decline in labor force quality,” the report explained.
The Philippines likewise declined to 38th rank from 34th last year in the appeal factor, but inched up in terms of investment and development to 62nd from the bottom spot last year.
Responding to queries via e-mail, IMD World Competitiveness Center director Arturo Bris noted that the Philippines’ labor force is not as equipped with skills that firms are looking for.
“It is true that Philippines is making progress in managing its talent pool, and indeed it is one of the two countries in SE (Southeast) Asia (together with Malaysia) which has improved the government investment in education as a percent of GDP (gross domestic product). However, in 2018 Philippines has witnessed a deterioration of its ability to provide the economy with the skills needed, which points out to a mismatch between the school curriculums and the demands of companies,” Mr. Bris said.
“The country needs to continue investing more and more in education. It currently invests 3.07% of GDP, but it is far from the world average of 4.7%. It also needs to make education more adapted to the economy. Which are the skills that the economy needs? Do companies partner with the public sector to help design curriculums?”
The report cited the Philippines’ overall strengths such as employee training, effective personal income tax rate, skilled labor, competent senior managers and language skills.
At the same time, it cited the country’s top weaknesses in the areas of total public expenditure on education, pupil-teacher ratio in primary and secondary schools, remuneration in service professions and labor force growth.
“If, as all the other countries in the region, Philippines facilitates the access to companies to foreign talent, and makes the country more attractive to foreigners, it will consequently make the domestic talent pool more competitive as well,” said Mr. Bris.