Times may seem gloomy. Gas prices are at an all time high and unemployment in the United States remains a problem. And many Americans are worried that their children’s futures will be compromised by today’s high deficits and debt. Yet, as we approach the Fourth of July, Americans still have myriad reasons to be proud. Economic conditions, despite the Fed’s recent lowering of growth projections, have improved since the Great Recession.
According to data released by IMD’s 2011 World Competitiveness Yearbook, the United States ranks No. 1 in the competitive analysis of 59 countries.
After falling to third place in 2010, which marked the first time the United States had ever fallen from the top since it moved to the first position in 1994, America has rebounded back into the leading spot.
The question many ask is whether or not last year’s slight decline signals the beginning of a downward trend. But historically, America has been capable of recognizing and dealing with a real or perceived loss of competitiveness. This is part of our culture — the United States always seems to find the means to reinvent itself and bounce back from adversity.
In fact, data shows that the fundamentals of U.S. competitiveness are still by far the strongest in the world. The economy has grown faster than any other major developed nation over the past decade.
Among the many reasons why the United States holds the No. 1 competitiveness ranking is because of its sheer size: its share of world gross domestic product at market prices is 24 percent and its world share of exports almost 10 percent.
By the end of 2010, the United States regained its place as the world’s second-largest exporter of goods, which it lost in 2007, and remains the world’s biggest importer at a staggering $2.3 trillion of merchandise and services from abroad.
In celebrating Independence Day, we can be proud of the country’s hardiness. Yet, like the budget cuts stifling some firework displays, we need to recognize that the horizon, although bright, is somewhat troubled.
In terms of competitiveness, the United States is no longer alone at the top; this year its ranking is shared with Hong Kong, Singapore, Sweden, Switzerland, Taiwan, Canada and Qatar, which all are less than 10 points behind the United States.
To keep the country as a leader in competitiveness, we must proactively interact with other top nations and address issues that threaten our ability to sustain our spot.
The United States remains addicted to foreign borrowing and it has lost ground in government efficiency with a 19th place ranking (down from eighth place in 2001).
And the gap between America’s government and business efficiency has been widening. This creates an environment where business and government no longer support one another, and risks pushing companies and jobs overseas.
The United States has also fallen behind in its basic infrastructure (roads, highways, railroads, airports) and its Internet connectivity. There is an urgent need to build state-of-the-art facilities and advanced high-tech networks.
And most importantly, despite the excellent reputation of America’s leading universities, the United States still needs to address a dysfunctional primary and secondary educational system.
Promoting post-high school training, similar to European apprenticeship programs, especially in technical and Internet technology skills, is key to maintaining a highly-qualified work force.
So, yes America, there is work to be done in order to guarantee future competitiveness. But, as Americans, we should take pride in our country’s past and present accomplishments.
America continues to bounce back, even if we moan and groan about the sacrifices made in order to do so. So let’s take this commemoration day to celebrate U.S. resilience as a world leader in competitiveness.
Dr. Suzanne Rosselet-McCauley is deputy director of the World Competitiveness Center at IMD Business School in Lausanne, Switzerland.
