ManpowerGroup Solutions' Managed Service Provider (MSP) TAPFIN, today released its second Contingent Workforce Index (CWI). The CWI measures and tracks the relative ease of sourcing, hiring, and retaining contingent workforce in 75 countries.

Hong Kong continues to be the highest-ranked country for contingent workforce operations in 2014, followed closely by the United States. China advanced from 16th place in 2013 to 3rd due to its well-balanced mix of relatively high workforce availability and industry dynamics, despite shifting regulations and wages. Other significant changes include Australia’s fall from 4th place in 2013 to 15th in 2014 as the result of rising manufacturing wages and reduced workforce availability.

Kip Wright, ManpowerGroup Solutions Senior Vice President, commented: “Managing business and workforce strategies globally presents tremendous challenges to business leaders who must align resources and leverage talent holistically.”

The second annual CWI was refined and enhanced to assure the analysis and results reflect the constantly evolving world of work trends. For example, additional insight into regulations and workforce dynamics, such as “language proficiency” was added. Greater emphasis was placed on the size of each country’s contingent workforce. This led to a jump in the rankings for countries with large populations and pools of contingent labour; such as China and India. Whereas countries with smaller pools of available contingent labour moved down the rankings; such as the Dominican Republic and Denmark.

Addition, the CWI increased the emphasis on productivity in order to more accurately reflect the cost of working in a particular county. Therefore, countries with higher levels of contingent workforce productivity; such as Macau and the UK, moved up the rankings.

Hong Kong is the highest ranked for contingent workforce engagement, followed closely by the United States and China. Hong Kong and the United States are both cost effective markets, but Hong Kong has the added benefit of higher productivity than the United States. While China is both less productive and cost effective than Hong Kong, and has increasingly complex regulations, it has the highest availability of talent of any market.

Below is a list of the countries included in the CWI report in alphabetical order and their overall Index ranking based on availability, productivity, cost and regulation. The lowest ranked country for contingent workforce engagement is Venezuela. This is primarily due to high regulations within the country and the fact that Venezuela, like Bolivia, does not allow for redundancy dismissal.

China remains the country with the highest workforce availability, although its contingent workforce availability ranking decreased from 0.84 in 2013 to 0.77 in 2014. Workforce availability in China, however, still exceeds that of its closest runner up, India, whose availability hovers around 0.50.

Brazil, Hong Kong, Korea, Russia, and Mexico have all dropped out of the top ten markets for contingent workforce availability. This is primarily due to the inclusion of English language proficiency in calculating out workforce availability, which negatively impacted the noted markets despite the size of their workforces.

India, which did not appear in the top ten rankings for 2013 contingent workforce cost efficiency, is now ranked the most cost efficient. This is primarily due to the reporting adjustments that removed average IT wage and average cost of labour, and added average monthly wage as a metric. India’s average monthly wages for contingent labour are significantly lower than many competing countries (USD 121.37 per month). At just USD 0.68 per hour, average wages for contingent manufacturing labour in India are particularly favourable compared to other countries, which is the reason for its increased ranking in 2014.

New Zealand‘s ranking as the most favourable regulatory environment has risen from fifth in 2013 to first in 2014. This is primarily due to the addition of geopolitical considerations to the 2014 Index, along with New Zealand’s lack of restrictions in the regulations tracked by the Index. New Zealand’s favourable regulatory and geopolitical conditions in 2013 also contributed to its increased overall ranking in this year’s report. The addition of geopolitical considerations is the reason behind Guatemala, Malaysia, and India falling from the rankings in 2014, and being replaced by Switzerland, Singapore, and the United Kingdom. Additional factors impacting this ranking are that Singapore and the United Kingdom do not have maximum contract requirements, and Singapore, Switzerland, and the United Kingdom do not have any severance requirements.