The report noted that Germany had weathered the global economic crisis of 2007/08 "relatively well," but its education system slipped due to lower-than-expected university enrollment.
Recent data have suggested Germany's place as the economic "strongman" of Europe is slipping. On Monday, Markit's purchasing managers' index showed that German industrial production only expanded narrowly in August, at its slowest rate in 11 months.
Read MoreEuro zone manufacturing slows to 13-month low
Here are the WEF's top 10 rankings for competitiveness:
- United States
- Hong Kong
- United Kingdom
In Europe, the WEF found that several countries severely hit by the global financial crisis of 2007/08, such as Spain (ranked 35th), Portugal (36th) and Greece (81st), had made significant strides in competitiveness.
Other countries in the region, such as France (23rd) and Italy (49th), had made less progress. "While the divide between a highly competitive North and a lagging South and East persists, a new outlook on the European competitiveness divide, between countries implementing reforms and those that are not, can now also be observed," said Schwab.
More than half of the WEF's 20 lowest ranked countries were in sub-Saharan Africa, due to the region's "profound" lack of infrastructure and low levels of health and basic education. Ebola-hit Guinea in the west of the continent was judged the world's least competitive country.
Here's the WEF's 10 least competitive countries:
- Sierra Leone
- Burkina Faso