China is the most competitive manufacturing nation in the world, and will hold the position for at least the next five years, according to a new report by Deliotte.
In the new Global Manufacturing Competitiveness Index China, Germany, and the United States took out the top three rankings for manufacturing competitiveness.
But in the five year outlook India and Brazil are tipped to take second and third spot, with Germany and the US falling to 4th and 5th.
Out of 38 nations Australia ranked 16th in 2012, and was tipped to fall to 17th over the next five years.
The UK is predicted to fall from 15th place today to 19th in five years time, and Deloitte UK manufacturing leader David Raistrick said developed countries would find it increasingly difficult to match innovation in rising nations.
“Frontier markets in Asia such as Vietnam and Indonesia are on the rise,” he said.
“While the UK is currently still performing very well against its global competitors, it will struggle to keep up the rapid pace of innovation, development, growth and investment expected from emerging countries such as Brazil and India.”
The report marked access to talented workers as the top indicator of a company’s manufacturing competitiveness, followed by trade, financial, and tax systems.
The cost of labour and materials was also marked as an important factor.
Raistrick said securing skilled and affordable workers was going to be the most significant challenge for manufacturers in the next five years given the “large skills gap” in the global industry.