Question

Question 14

List and briefly describe 3 of the characteristics of countries that are thought to encourage investment in human capital.

Answer 1

Human capital can include qualities like:

• Education.
• Technical or on-the-job training.
• Health.
• Mental and emotional well-being.
• Punctuality.
• Problem-solving.
• People management.
• Communication skills.
• Skills and qualifications.
• Education levels.
• Work experience.
• Social skills – communication.
• Intelligence.
• Emotional intelligence.
• Judgement.
• Personality – hard working, harmonious in an office.
• Skills, Qualifications, and Education
• Work Experience
• Social and Communication Skills
• Habits and Personality Traits
•   Individual Fame and Brand Image

1. Skills, Qualifications, and Education

The productivity of workers is closely tied to their skills, education, and qualifications. Just as factories invest capital in machinery that increases productivity, so workers or companies invest in education and training that increase productivity. This is especially the case in businesses that specialize in services, technology, or intangible products where value is created by innovation and creativity rather than working with physical materials. For example, the key creator of value in a medical practice is the doctors’ training and skills, just as law degrees create value in a legal partnership.

2. Work Experience

The more experienced employees are, the more they create value. According to the Harvard Business Review, it may take employees anywhere from three months to a year to become productive. Every time a business loses an employee to a competitor, layoffs, or retirement, it needs to invest in recruiting and training new staff, something that is just as much an expense as replacing machinery in a manufacturing plant. Thus, work experience can be seen as a form of capital that generates revenue.

3. Social and Communication Skills

No matter how much employees know or how much they have developed expertise in a corporate culture and practices, that knowledge is of little use if they cannot communicate effectively or work well with other employees. The social and communication skills of employees are even more important in areas of business which involve dealing with customers or clients, as good customer service can affect how customers respond to a brand.