AI could threaten high-income economies’ attractiveness to talent, finds 2024 IMD World Talent Ranking

The 2024 IMD World Talent Ranking (WTR) report has signaled how policymakers should start streamlining regulation to minimize the impact of the potential exclusion arising from the widespread adoption of AI.

Recommendations in the report, produced by the IMD World Competitiveness Center (WCC), include a focus on educational and labor market policies and a heavy emphasis on retraining and upskilling.

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“Instead of debating AI’s ability to do certain tasks as well as humans, our focus should be on understanding and learning AI and Web3 technologies, which should take precedence in our education systems,” said Arturo Bris, Director of the WCC, which produces the ranking. “Whilst it is not yet clear whether AI will make countries more talent competitive, the data does show that AI is going to impact inclusion and discrimination, because of the difference in access that employees have to it.” The WCC Executive Opinion Survey, which fed into the WTR’s results, found that in developed economies, more jobs are being transformed or replaced by AI than in less developing ones. AI therefore acts as an equalizer across nations when it comes to talent competitiveness, in the sense that it makes the more competitive nations less competitive, and the less competitive nations more competitive.

AI replacing human labor could exacerbate exclusion in certain major economies

In Japan (43rd), Thailand (47th), Singapore (second), the UK (27th), and Canada (19th), senior executives were found to consider AI to be most visible in the workplace by the way it is replacing people. In addition, discrimination was found to be increasing in these economies. However, there is a caveat; whilst these economies may experience drawbacks during the AI adoption phase, in the long term they will likely still reap AI’s benefits. Meanwhile, rising discrimination levels could damage their attractiveness to highly skilled overseas staff, affecting talent attraction and talent retention, the report said. “Discriminatory practices – whether based on race, gender, age, disability, or sexual orientation – are not going to help attract and retain talent. Beyond that, attracting and retaining highly skilled talent fosters innovation and maintains an economy’s competitive edge,” said José Caballero, WCC Senior Economist. The report also touches on how much AI is seen to enhance tasks or provoke quiet quitting in different economies, the likelihood of men’s versus women’s employment being affected by automation, and how talent competitiveness in the AI era requires a swift reassessment of educational systems and corporate training programs to ensure workers possess the skills needed. The ranking computes pieces of statistical data and survey responses (“criteria”) using a unique methodology. It is structured across three major areas, or “factors”: Investment and Development, Appeal, and Readiness. Switzerland came first, Singapore second, and Luxembourg third out of 67 economies in the eleventh edition. Singapore’s steady rise to the top – for the first time since the inception of the ranking in 2014 – is driven by its robust performance in the readiness of its talent pool. It was 8th last year. Switzerland dominates the Investment and Development and Appeal factors, while Singapore excels in Readiness (specifically of its talent pool) and Luxembourg relies on a strong Investment and Development approach to talent competitiveness. Ghana, Nigeria, and Puerto Rico were measured in the WTR for the first time this year.