The U.S. has plummeted from the third spot to the 10th in the IMD World Competitiveness Ranking 2020, according to the research group IMD World Competitiveness Center. America has now fallen behind Canada, Denmark and Sweden, among other nations.
The center is part of the Institute for Management Development (IMD), an "independent academic institution with Swiss roots and global reach," founded nearly 75 years ago for and by leaders in business.
The annual rankings measure "global economies and their ability to generate prosperity," according to the center's website. The 2020 results are a combination of hard data gathered in 2019 and survey responses from earlier this year, according to its site. The center ranked the performance of the economies of 63 countries in the world.
The U.S.' downward turn in the rankings started last year, when it dropped from the first spot in 2018 to the third in 2019.
The center citedas a key factor in reversing the "positive growth trajectories" of the economies of both U.S. and China. China dropped to the 20th position in the 2020 rankings, from the 14th slot in 2019.
The center compiled the 15 biggest improvements and declines in the— which are determined by the biggest percentage changes of each criterion on the list, from one year to the next.
It cites the stability of the exchange rate and percent of high-tech exports as the biggest improvements in the overall performance of the U.S. economy.
The center lists "gross fixed capital formation - real growth," which means America's investment in infrastructure, schools and land improvements that help keep the country's economy moving, as the top criteria resulting in America's decline in rankings.
The "Government budget surplus/deficit (%)" is listed as the second key criteria for the decline. So far in the fiscal year 2020, the U.S. budget deficit has ballooned to about $1.9 trillion, according to the Congressional Budget Office (CBO) website. The deficit is expected to reach $3.7 trillion by the end of the 2020 fiscal year, the CBO projected in April.
Singapore clinched the top spot for the second year in a row. The center cited its success culminating from the country's strong economic performance, which it said stems from its "robust international trade and investment, employment and labor market measure."
"Stable performances" in its education system and technological infrastructure also contributed to its ranking this year.
Denmark and Switzerland moved up in the rankings this year to earn silver and bronze, respectively. Venezuela came in at the bottom of the list for the second year in a row.
The center said that the strength of smaller economies is a "marked pattern" in this year's results.
"The benefit of small economies in the current crisis comes from their ability to fight a pandemic and from their economic competitiveness," said Arturo Bris, director of the center and professor of finance, according to the site. "In part these may be fed by the fact it is easy to find social consensus."