According to Deloitte, the international consultancy, the Czech Republic will claim a place in the global manufacturing competitiveness index by 2020 , rising from the current 23rd to 20th position.
The main factors pushing scores up in the survey is the availability of local talent in the workforce, cost competitiveness, workforce productivity, and the supplier network. Further down come such factors as the regulatory environment, education provision, and physical infrastructure such as roads, storage space and international connections.
Chief Economist at Deloitte’s Czech branch, David Marek, says Czech manufacturing companies have been benefitting in recent years from low labour costs with the low crown contributing to that advantage:
“The most important factor for the short term development of competitiveness, in terms of price competitiveness, is the three years long trend of declining labour costs in the Czech Republic together with a stable nominal exchange rate. It means a declining real exchange rate of the Czech crown and that’s the single most important factor driving competitiveness.”
Šárka ŠevčíkováBut in spite of the survey predictions, Marek sees some possible clouds on the horizon in the ability of bosses to tap into the talent on the local jobs market as Czech unemployment continues to shrink.
“The unemployment rate has declined and now it is very, very low. And it’s now sometimes quite difficult to find a qualified labour force in some regions and in some sectors of the economy. So talent could be a problem being faced by an increasing number of companies.”
According to Deloitte, the United States will become the top global competitive manufacturer within five years, placing the current leader, China, into second position. Aside from China and the USA which have been holding the top two spots, Germany and Japan will remain in third and fourth place, respectively.
India, which is currently included in the top 11, is anticipated to leap up to fifth place. South Korea, Canada and Singapore are likely to drop one place each due to the growth of India, whilst Taiwan and the UK are most likely to lose two spots. Mexico, on the other hand, is anticipated to jump up one place to seventh position.
It is likely that Malaysia will rise from 18th to 13th place, Vietnam from 18th to 12th place and Indonesia from 19th to 15th place. On the other hand, European countries, including Switzerland, Sweden, Poland and the Netherlands will probably drop six spots.
This prognosis is based on an in-depth analysis of the results of a survey of more than 500 CEOs and leaders in global manufacturing companies. The ranking of individual countries is included in the list of findings published by the annual National Competitiveness Forum of the US Council on Competitiveness which took place on 4 December 2015.