The UK was rated “medium risk” in the annual child labour index compiled by Bath-based global analysts Maplecroft.
It rose 12 places to be ranked 142nd this year, ahead of low-risk countries including Hong Kong (160th), France (163rd), Germany and Ireland (jointly at 175th) and Australia (185th).
Maplecroft said Britain fared worse in the index than other Western nations because large numbers of children were trafficked to and within the UK for labour and sexual exploitation.
The survey of 197 countries was topped by Burma, North Korea, Somalia and Sudan in joint first place, followed by the Democratic Republic of Congo, Zimbabwe and Afghanistan.
A total of 76 nations were judged to pose an “extreme risk” to children’s welfare through the use of underage workers, up more than 10% from 68 last year.
The analysts put this sharp increase down to deteriorating security, resulting in greater numbers of children fleeing their homes and becoming internally displaced or refugees, and the global economic downturn.
The research also highlighted the risk to multinational supply chains from the prevalence of child labour in rapidly-growing emerging countries including India (ranked 27th), China (36th), Vietnam (37th) and Brazil (54th).
Maplecroft human rights analyst Chris Kip said: “Business can be directly implicated or can be deemed complicit in violations of the prohibition of child labour if children are found to be working within their operations or are used by their suppliers.
“Companies should ensure stringent human rights due diligence within their supply chain is undertaken to reduce the risk of damaged reputations, litigation, investor alienation and consumer backlash.”