Developing Human Capital
Human capital is not static; it can be improved. The key facilitators are:
1. Education and Training
- Education: Starts with basic literacy and extends to expertise. It enriches knowledge and problem-solving abilities.
- Training: The process of learning specific skills for a job (e.g., a civil engineer visiting a construction site).
- Cognitive Development: Learning, knowing, and understanding.
2. Healthcare
Good health is fundamental.
- Impact: Healthy workers are physically and mentally sound, more creative, and absent less often.
- Result: Higher productivity and efficiency.
3. Social and Cultural Influences
The work culture of a country influences its productivity.
- Japan (Kaizen): Meaning “continuous improvement”. Applied since the 1940s, leading to high living standards.
- Germany: Known for a strong work ethic, punctuality, and attention to detail, making them leaders in technology.
Challenges to Human Capital
Literacy
- Adult Literacy Rate: Percentage of people aged 15+ who can read and write a simple statement.
- India’s Status (2023): 85% for males, 70% for females (World Bank estimates).
Demographic Dividend
India has a very young population. According to the Economic Survey 2024, 65% of Indians are below 35 years.
- Definition: The economic benefit a country gets when it has a large number of young, working-age people compared to dependents.
- Requirement: To reap this benefit, the youth must have access to quality education, health, and skilling.
Note
Why is this important? When more people work and earn, and fewer depend on them, the nation creates a surplus that drives rapid economic growth.