KPMG report claims UK been overtaken by France, Italy and the Netherlands
The UK has fallen from third to sixth position in terms of global cost competitiveness, according to KPMG's latest report.
The analyst's 2006 Competitive Alternative report, which it claimed provides an independent comparison of international business location costs in 128 cities around the world, found that the UK had been overtaken this year by France, Italy and the Netherlands. Singapore and Canada held the first and second spots respectively.
Ian Barlow, London senior partner at KPMG, said: "Whilst these results are disappointing at one level I think that what we are really seeing here is the price that the UK is paying for having a successful economy.
"Low unemployment rates, higher labour costs and a strong pound have increased the market cost of our skilled labour over our competitors who do not have all of these benefits," he said.
KPMG's bi-annual report measures 27 cost components, such as labour, business facilities and taxes. However, it still concluded that the UK remains ahead of the US, Japan and Germany, which came in seventh, eighth and ninth position respectively.
In terms of cities, London came eighth out of ten ahead of Frankfurt and New York respectively. However, it fell behind the likes of Singapore, Amsterdam, Paris and Chicago, which came first, third, fifth and sixth respectively.
However, Ian Barlow stressed that: "Major cities such as London will always be less competitive in terms of direct business cost. London in particular has been voted Europe’s best city for business for 16 consecutive years and is unrivalled in its diversity of business opportunities."
The report also discovered that Lincoln, Barnsley and Derby were some of the most cost competitive cities in the UK.
The UK has fallen from third to sixth position in terms of global cost competitiveness, according to KPMG's latest report.
The analyst's 2006 Competitive Alternative report, which it claimed provides an independent comparison of international business location costs in 128 cities around the world, found that the UK had been overtaken this year by France, Italy and the Netherlands. Singapore and Canada held the first and second spots respectively.
Ian Barlow, London senior partner at KPMG, said: "Whilst these results are disappointing at one level I think that what we are really seeing here is the price that the UK is paying for having a successful economy.
"Low unemployment rates, higher labour costs and a strong pound have increased the market cost of our skilled labour over our competitors who do not have all of these benefits," he said.
KPMG's bi-annual report measures 27 cost components, such as labour, business facilities and taxes. However, it still concluded that the UK remains ahead of the US, Japan and Germany, which came in seventh, eighth and ninth position respectively.
In terms of cities, London came eighth out of ten ahead of Frankfurt and New York respectively. However, it fell behind the likes of Singapore, Amsterdam, Paris and Chicago, which came first, third, fifth and sixth respectively.
However, Ian Barlow stressed that: "Major cities such as London will always be less competitive in terms of direct business cost. London in particular has been voted Europe’s best city for business for 16 consecutive years and is unrivalled in its diversity of business opportunities."
The report also discovered that Lincoln, Barnsley and Derby were some of the most cost competitive cities in the UK.
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