Here are the most and least competitive labour markets in the world

Roman coleseumShutterstockItaly has the least competitive labour market in the world.

If you’re looking to hire on the cheap, you’ll want to avoid large portions of Europe.

According to new research by
Verisk Maplecroft, the British risk analytics company, Italy, France, and Belgium are the least competitive labour markets in the world.

Meanwhile, Djibouti, Myanmar, and Bangladesh are the most competitive.

Verisk Maplecroft arrived at these rankings by comparing labour costs to productivity per employee.

Here are the 10 least competitive labour markets, according to Verisk Maplecroft’s research:

1. Italy
2. France
3. Belgium
4. Spain
5. Finland
6. Slovenia
7. Luxembourg
8. Austria
9. Iceland
10. Greece

Compare that with the five most competitive markets:

1. Djibouti
2. Myanmar

3. Bangladesh

4. Cambodia

5. Brunei

The notion of “most” and “least” competitive labour markets in this case may seem counterintuitive. Italy and its European peers are seen as uncompetitive because of how expensive it is to employ people there, due to the high wages, strong unions, and large severance packages. In this way, the market is competitive for employees within these countries, but not for firms that might be interested in doing business there.

Verisk Maplecroft senior analyst Charles van Caloen tells Business Insider that Denmark and Germany perform well in the index despite having very high nominal wages because they have high levels of productivity and less burdensome labour regulations than many other high-income European countries. The US, for the record, is ranked No. 17.

African and South Asian countries have little in the way of labour protections, making them very cheap to manufacture in but often dangerous to workers, as headlines of factory collapses attest.

“Indirect costs of association with human rights violations, such as child labour, can include weakened brand equity and reduced sales,” says Verisk Maplecroft human rights specialist John Thompson. If a company runs into human rights violations, Thompson says, it can lose customers, potential investors, and partners.

NOW WATCH: Ideas videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.