Human capital is a term used by economists to describe the economic value of a workers experience and skills. It encompasses personal attributes that are considered useful in the production process, such as knowledge, skills, know-how, good health, and education. Human capital is an intangible asset or quality that is not listed on a companys balance sheet, but it is perceived to increase productivity and profitability.
Investing in human capital can be done through education and training, which can lead to improved levels of quality and production. Research indicates that human capital investments have high economic returns throughout childhood and young adulthood. Companies can improve human capital by investing in the training, education, and benefits of their employees.
Human capital is perceived to have a relationship with economic growth, productivity, and profitability. At the macroeconomic level, quantifying the effects of human capital on growth and productivity is important. The Human Capital Project is a global effort to accelerate more and better investments in people for greater equity and economic growth. It aims to transform human capital outcomes in countries at all income levels by scaling up human capital investments, focusing on areas such as early childhood, building the resilience of vulnerable people, and leveraging technology and innovation.
In summary, human capital refers to the economic value of a workers experience and skills, and it encompasses personal attributes that are considered useful in the production process. Investing in human capital can lead to improved productivity and profitability, and it is perceived to have a relationship with economic growth.
