Singapore falls to 7th globally for talent attraction and retention

Singapore’s slide to seventh in the IMD World Talent Ranking is not a skills story. It is a price-and-policy signal that the cost of anchoring talent has risen faster than the perceived value of staying, even as capability indicators remain robust. The release on Sep 9 confirms a five-place drop, with Hong Kong overtaking Singapore as Asia’s top performer at fourth, and Switzerland, Luxembourg, and Iceland in the top three. The IMD World Competitiveness Center’s 2025 calendar had flagged today’s publication date, underscoring the timeliness of the readout.

The composition of the fall matters. Singapore’s sharpest deterioration came in “investment and development,” slipping from 22nd to 30th, with public education expenditure at 2.1 percent of GDP placed 63rd. On “appeal,” high cost of living was a notable drag, ranked 65th. Yet readiness stayed near the frontier, easing only to second, supported by strong PISA outcomes, a solid pipeline of science graduates, and positive ratings from highly skilled foreign professionals. In short, the engine is tuned, the fuel mix is world class, but the running costs have climbed.

The risk lens is straightforward. Firms respond to relative price signals before talent does. IMD’s briefings emphasized that rising living costs are making it harder for talent to remain, and that organizations are relocating to Indonesia, Malaysia, Thailand, and Vietnam to access similar workforce quality at lower total cost. That relocates decision rights, payroll, and eventually managerial gravity. Talent follows the work, not the other way around.

Exposure is uneven across sectors. Cost-sensitive, mid-skill operational hubs are most mobile, and they have alternatives in ASEAN that now look more stable and attractive than a decade ago. Malaysia’s movement in the table, landing mid-pack at 25th, reinforces that narrative. Taiwan at 17th, South Korea at 37th, and China at 38th sketch a diversified regional landscape in which companies can rebalance footprints while keeping supply chains within a manageable time zone. For Hong Kong, the ranking’s climb consolidates its pitch to financial and professional services that recruit globally and value deep labor-market liquidity.

Liquidity and regulatory responses are already visible in peer markets. The UAE has entered the global top ten at ninth, leveraging pro-mobility visas, private-sector competitiveness, and a deliberate strategy to convert international student inflows into labor-market absorption. Hong Kong’s rise to fourth comes with improved scores across appeal, readiness, and investment and development, as highlighted in official remarks at a regional summit. The shared playbook is clear: make entry easier, reduce friction in residency, and integrate education pipelines with firm demand.

For Singapore, the ranking is not a verdict on capability; it is a prompt on pricing and provisioning. The readiness pillar suggests that the skills system remains highly aligned to market needs. The investment signal points to a calibration problem, where public outlays for education and structured apprenticeships lag peers on a percentage-of-GDP basis, even if outcomes remain strong. The appeal pillar tells a familiar story about cost of living. These are fixable variables that sit squarely in policy space: targeted increases in education and training investment, scaled mid-career apprenticeships tied to industry demand, and surgical measures that lower recurring household outlays that matter to mobile professionals.

The IMD analysis also highlights international student mobility as a long-horizon anchor. Economies that attract and retain foreign students, then transition them into productive employment, will build durable talent stocks without bidding wars. That message is consistent across the leading risers in this year’s table and points to a competition that starts on campus but is won in visa queues and housing markets. In that context, the IMD World Talent Ranking 2025 Singapore result should be read as a timing cue, not a structural downgrade.

Market operators will price these signals quickly. Multinationals that had paused footprint decisions now have fresh data to justify reallocations within ASEAN, while sovereign allocators will watch whether policy moves narrow the gap between capability and affordability. The adjacency risk is that relocations harden into ecosystem shifts if costs are not contained and education investment signals do not change.

What it signals: cost inflation now sits at the center of talent retention, and marginal policy outlays in education and training can buy leverage over time. Readiness remains a national strength, but the appeal and investment messages are audible. If they are answered with credible measures, the relative slide can be reversed, and the region’s capital flows will reflect it.