TOTAL WORKFORCE INDEX

COMPARISION OF TOP
GLOBAL MARKETS

Top 10 Markets for Total Workforce Engagement

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The Total Workforce Index™ scores 75 markets on more than 200 unique factors, providing a comprehensive and comparative analysis of four categories: Workforce Supply, Cost Efficiency, Regulation and Productivity. Within these, we look at relevant subcategories, such as the impact of the gig workforce, remote readiness indicators and geopolitical risks.

The markets that rank highest in the Total Workforce Index™ are those with the highest relative performance across all four categories and have successfully responded to remote workforce readiness, automation, skills gaps and potential talent shortages, shifting regulations and the rapid pace of technology.

To address continued reliance on remote workforce deployment, the 2021 Total Workforce Index™ leverages global remote work readiness indicators across each of the 75 markets. These help employers determine how and where to balance their onsite and remote workforces with over 20 unique market factors, including the impact of childcare constraints, technical and cybersecurity capacity, and demand for remote workers at a market level. The 2021 Index takes into account the impact of markets reopening at varied paces and to different degrees this past year. Heavier weighting on aspects of talent supply, border accessibility and cost considerations have been assigned to reflect these shifts. This year’s Index also takes into account increased focus on gender and diversity considerations. Finally, the category of Workforce Availability remains focused on measuring the population of different types of workers in different markets, but it has been renamed Workforce Supply. This shift in language more accurately reflects that the category addresses the number of workers in a market, not whether they are available and looking for work.

#1 #2 #3 #4 #5 #6 #7 #8 #9 #10
  • Workforce Supply
  • Cost Efficiency
  • Productivity
  • Regulation

After dropping to 10th place last year after four years in the top three due to border closures, Singapore jumps to 2nd place. The drop in 2020 was a typical finding among countries that closed their borders quickly as COVID-19 emerged because these border controls substantially impacted their remote readiness rankings and the ability of foreign companies to effectively engage talent. Canada entered the top five for the first time last year and solidifies its role as a high-potential market in 2021 thanks to remote skills availability and other weighting adjustments. The United States holds on to the top spot due to its focus on remote-ready workforce metrics, such as technical infrastructure, language proficiencies and skills availability.

Top Markets in Last Five Years

Through each iteration of the Total Workforce Index™ and despite the weighting’s adjustments and addition of over 50 factors since it’s inception, several markets are consistently featured in the top ten markets each year. Hong Kong, United States, New Zealand, Singapore, United Kingdom, Ireland and Canada have appeared in each of the annual reports in the top ten markets for total workforce engagement in the past five years. This pattern demonstrates stability in these more mature workforces as well as workforce skills supply, language proficiency and moderately flexible regulatory factors.

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How do Markets Secure a Position in the Top Ten?

The overall rankings are influenced equally by the scores for each market in all four categories. If a global market were to perform ‘very good’ to ‘excellent’ in two or more of the four categories, the result would be a rise in ranking overall. Markets with more variation in scoring and performance across all four categories typically fall in the middle of the spread and will not score as well overall when categories are evenly weighted.

The weighting of individual Total Workforce Index™ factors as well as categories is fully customizable in a consultative setting. For example, if an organization chooses to weigh cost efficiency and regulation influencers lower than workforce supply and productivity, the top ten would instead reveal a unique top ten workforce markets better suited for that organization’s workforce strategy. Additional analysis of the reasons behind the data rankings would benefit organizations seeking to use the Total Workforce Index™ to inform their business and hiring strategy.

Comparison of Top Five Markets ranked by Total Workforce Index™

The top five markets for workforce engagement, based on the rankings of the Total Workforce Index™ are the United States, Singapore, Canada, Hong Kong and Netherlands.

top5_workforce_index

Size of the bubble reflects the Relative Workforce Supply of each market, while the color reflects Relative Regulation

  • Minimal Regulatory Impact
  • Moderate Regulatory Impact
  • Restrictive Regulatory Impact

As employers have increasingly focused on accessing remote talent across global operations, the relevance of English proficiency, emerging talent, skilled work profiles, and legislative enablement of virtual employment models for foreign employers has become critical. Although the talent shortage is prevalent in every major market today, these five countries have existing workforces with the highest relative alignment to key criteria of global employers. In addition, the employment law, tax policy, border and visa processes are most conducive towards foreign employment practices whether there is in country presence or not. Though other countries such as United Kingdom, Australia, and New Zealand also ranked favorably across Workforce Supply and Regulation, these five countries had the highest collective rankings inclusive of both Cost and Productivity categories as well. One point to consider is that despite the existence of talent, it is necessary to be competitive from a compensation and flexibility perspective.

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2021 Top 5 2020 Top 5 2019 Top 5 2018 Top 5 2017 Top 5

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Comparison of the Top Five Markets for Workforce Supply

Workforce Supply measures the current skilled workforce in each market and the sustainability of that workforce based on demographic trends, such as age and influx of immigrants. Markets scoring favorably in this category have the highest supply of skilled workers with a high level of English proficiency or other high-demand languages, such as Spanish and French, high remote workforce readiness, and a relatively large, diverse workforce, including contingent and gig workers, which are weighted more heavily given that companies looking at new markets often seek the flexibility and volume contingent workers provide. Note that Workforce Supply is a measure the of the proportion of people in a given market that meet the defined criteria within a factor. It is not an indicator of the number of people who are looking for work.

The top five markets for Workforce Supply are the United States, Singapore, Switzerland, United Kingdom and Netherlands.

top5_workforce_availability

Size of the bubble reflects the Relative Workforce Supply of each market, while the color reflects Relative Regulation

  • Minimal Regulatory Impact
  • dots_orangeModerate Regulatory Impact
  • dots_redRestrictive Regulatory Impact

The rankings for the top three markets – United States, Singapore and Switzerland – remain unchanged from 2020. Meanwhile, after a 6th place finish in 2020, the United Kingdom enters the top five for the fourth time in five years. The Netherlands jumps up two spots from 7th in 2020 to 5th this year, while the remaining markets from the 2020 rankings in this category – Luxembourg and the UAE – fall out of the top five altogether.

Employers' priorities shifted in 2021 when evaluating access to talent across global operations from time zones and supply chain constraints to workforce diversity, but English proficiency, education, and skill profiles remained the dominant criteria as nearshoring or offshoring strategies were considered. While unemployment of key skills remains critically low, it is necessary to remain competitive in both wages and flexibility to ensure effective hiring practices. These markets represent the greatest opportunity to attract talent from current engagements to meet an employer's hiring needs. This does not account for cost, legislative, or productivity considerations that may alter the appeal of one market over another, and custom weighting of criteria may alter the results of these rankings.

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2021 Top 5 2020 Top 5 2019 Top 5 2018 Top 5 2017 Top 5

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Comparison of the Top Five Markets for Workforce Cost Efficiency

Cost Efficiency measures the relative comparison of wage, benefits, tax and operations metrics to suggest potential cost efficiency. Traditionally, the lowest-cost markets also tend to be the least mature and generally have less restrictive regulations and higher workforce supply. However, wages have increased reactively to various government stimuli and demand pressures across the globe, underscoring the importance of monitoring and comparing the total cost of labor in forecasting and budgeting workforce cost. The top five markets for Cost Efficiency are Thailand, Hong Kong, Macau, Guatemala and Bahrain.

top5 workforce cost efficiency

Size of the bubble reflects the Relative Workforce Supply of each market, while the color reflects Relative Regulation

  • dots_greenMinimal Regulatory Impact
  • dots_orangeModerate Regulatory Impact
  • dots_redRestrictive Regulatory Impact

The rankings for Cost Efficiency this year were largely impacted by shifting country dynamics—namely wages, due to cost of labor and regulations. With the exception of Thailand, which ranked 5th in 2020, all markets are new entrants to the top five. While the supply, regulation, and productivity of talent should play a crucial role in any site or market selection, cost is never far from mind when making a final determination. Comparing the relative cost of labor both from a skilled and non-skilled perspective includes not just the wages, but the relative impact of statutory burdens, payroll taxes, overtime premiums, parity requirements and other aspects of labor cost which are now considered as important as the wages themselves. As employers have increasingly invested in foreign employment to fuel their virtual workforce throughout the pandemic, the total cost of labor has been pivotal in location strategy as those non-wage costs can often undermine a cost-driven approach to site or market selection if not evaluated on the front end.

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2021 Top 5 2020 Top 5 2019 Top 5 2018 Top 5 2017 Top 5

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Comparison of the Top Five Markets for Regulatory Efficiency

Regulation measures the relative comparison of how restrictive the terms and practices of workforce engagement are based on a standard set of regulations. Favorable regulatory environments are created when many types of workforce engagements, and formal or informal work, are available to organizations, while maximum contract lengths, notice periods and severance requirements are minimal or not required. The top five markets for Regulation are Norway, Estonia, Austria, Finland and Denmark.

top5 workforce regulation

Size of the bubble reflects the Relative Workforce Supply of each market, while the color reflects Relative Regulation

  • dots greenMinimal Regulatory Impact
  • dots orangeModerate Regulatory Impact
  • dots redRestrictive Regulatory Impact

This year’s rankings for Regulation continue to be impacted by border restrictions affecting access to labor, as well as more stringent requirements around labor allocations/quota (i.e., allocations of national versus foreign labor and ratios of permanent versus contingent labor categories). The top five markets for Regulation are Norway, Estonia, Austria, Finland and Denmark. Estonia and Austria are new to the top five, climbing from 11th and 8th, respectively. These markets benefit from geopolitical stability and employer-driven legislation that makes it relatively easier to engage workers.

Employment regulation priorities shifted in 2021 as employers evaluated nearshore and offshore opportunities across the globe. Rather than focusing exclusively on contract duration limits, hiring mandates, and geopolitical concerns – employers prioritized border policies, foreign employment law, operating license restrictions and payroll policies that could better enable remote work strategies. These markets demonstrate the greatest access to talent, regardless of classification or location, for employers looking to hire in market. These countries also rank highly for traditional legislative priorities related to working hours, restrictions, and geopolitical risk, making them the most risk averse options for emerging virtual employment strategies.

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2021 Top 5 2020 Top 5 2019 Top 5 2018 Top 5 2017 Top 5

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Comparison of the Top Five Markets for Workforce Productivity

The Productivity category measures the relative potential productivity of a workforce based on the number of hours an employer can compensate a worker at base pay before overtime. Productivity is a category influenced by all three other categories (Workforce Supply, Cost Efficiency and Regulation). The top five markets for Productivity are Israel, Netherlands, Singapore, Canada and Hong Kong.

top5 workforce productivity

Size of the bubble reflects the Relative Workforce Supply of each market, while the color reflects Relative Regulation

  • dots greenMinimal Regulatory Impact
  • dots orangeModerate Regulatory Impact
  • dots redRestrictive Regulatory Impact

This year’s rankings for Productivity are influenced by changes in the average length of a workday and workweek, as well as the average number of working days in a year. Workforce infrastructure (e.g., the technical infrastructure that supports a remote workforce) is also a contributing factor. The top five markets for Productivity are Israel, Netherlands, Singapore, Canada and Hong Kong. The Netherlands is new to the top 5, rising from 9th in 2020. Canada also re-enters the top five for the third time in five years after dropping to 7th last year due to border restrictions and changes in educational priorities.

Cost and workforce supply tend to lead the conversation when an employer is looking at market expansion, and yet the impact of productivity can ultimately have substantial impact on both. Most relevant in 2021 has been the number of public holidays, the limitations of Covid closures, overtime restrictions and the average working hours in a week. All things considered, when those factors are weighted most heavily, these top five markets allow for the greatest relative access to labor at base pay across any given work period. Predominantly driven by legislation, these markets are also most conducive to virtual employment by foreign employers for cross border access without double taxation or added fees.

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2021 Top 5 2020 Top 5 2019 Top 5 2018 Top 5 2017 Top 5

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