Canada's competitiveness slips

Taxation and labour market contribute to three-point drop
By
|hrreporter.com|Last Updated: 10/06/2006

Canada has slipped three spots in a ranking of the world's most competitive countries, according to a new international report.

Canada's tax rates and regulations were the two "most problematic'' business factors, the survey by the Geneva-based World Economic Forum found. Inefficient government bureaucracy and restrictive labour regulations were also cited.

Canadian economic competitiveness dropped to 16th place from 13th, placing it between Israel and Austria.

Another problematic area was labour market flexibility, where the survey found low grades for co-operation in employer relations, flexibility of wages and hiring and firing practices.

Canada's health and primary education systems were bright spots in the survey, coming in second overall.

However, the ranking of higher education and training — which includes high school — dropped six spots. The quality of math and science education contributed to this drop, said Laura Altinger, a senior economist at the World Economic Forum.

The survey examines 14 factors that can affect an economy's business environment and development — including the levels of judicial independence, protection of property rights, government favouritism in policy-making and corruption.

In the survey, both corruption and government instability were considered the least problematic of factors for doing business in Canada.

Over 11,000 business leaders in 125 countries took part in the survey, which ranked Switzerland as the world's most competitive business environment.

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