The UK will be one of the world's talent hotspots within the next five years thanks to the quality of its education system and an open labour market.
The results of the Global Talent Index compiled by the Economist Intelligence Unit and headhunter firm Heidrick & Struggles puts only the US ahead of the UK.
The study measured the demographics, quality of compulsory education, universities and business schools, mobility, labour market conditions and trends in foreign direct investment of 30 countries, to identify the best locations for attracting talent.
The UK will replace the Netherlands as Europe's top country for attracting talent by 2012 but will remain behind the US.
But both countries face increasing competition from China and India in the top 10 talent hotspots, while Asia performs strongly overall with Japan, Malaysia and South Korea all in the top 15.
The other Bric countries (Brazil, Russia, India, China) — Brazil and Russia — will fare less well. Brazil will fall one place to nineteenth, while Russia will fall out of the top 10 and be overtaken by Ukraine.
David Peters, regional managing partner, Europe/Middle East/Africa (EMEA), at Heidrick & Struggles, said in the report: "The openness of our labour market, combined with our excellent schools and universities, proves that the UK is one of the best business locations in the world — and is becoming even better."