Singapore finished behind only Switzerland, yet were the only Asian country to make the top 10 of the index.
The annual study determines each country’s competitiveness based on the quality of talent that it can attract, produce and retain.
However, the report warns that Singapore is up against fierce competition from surrounding countries which is sure to deepen when regional integration picks up further, according to the report’s authors.
In particular, one of the biggest challenges is “grooming talent” for global or regional roles at top companies, according to Professor Paul Evans, the Shell Chair of Human Resources and Organisational Development, and the report’s co-author.
"(You) cannot run a global company in a senior management role unless you have in-depth international experience... The issue of how we can develop our own people instead of relying on expatriates remains a key challenge," Evans was quoted as saying by The Straits Times.
"Things are so good in Singapore that taking a risk and moving one's family, even to somewhere nearby like Indonesia, is not attractive to many Singaporeans."
Evans added that it takes much resilience and “deep inner courage” to run a large corporation, and he doesn’t think that can be developed through any other way than “deep personal experience”.
He also said that Singapore has responded to its technical skills shortage by atempting to alter mindsets and move towards an educational system with varied pathways.
Further, Wong Su-Yen, chief executive of the Human Capital Leadership Institute, was quoted by The Straits Times as saying that research has found strong links between talent mobility and innovation.
“Companies need to appreciate that when you bring in diversity, that drives innovation,” she said.
For the third straight year, Singapore has been ranked the world's second-most talent-competitive country, according to the Global Talent Competitiveness Index.