HUMAN CAPITAL 2018-09-26T23:30:13+00:00

Project Description

HUMAN CAPITAL

The Vision @ 100

Traditionally, the question of a country’s development has been associated with its economic progress, measured primarily in terms of growth rates and per capita income. Over the last few decades, however, it has increasingly been recognized that a more holistic definition of development is required, one that places human welfare at the core of notions of progress.  It is in this context the academics, policymakers, and other stakeholders refer to human development, which can be broadly defined as the processes through which the capacities, opportunities, and well-being of people are enhanced.

More specifically, measures of this tend to focus on a few key indicators such as education, nutrition, and healthcare, with progress in each of these areas being seen as vital to human development. The Human Development Index (HDI), which measures education, life expectancy, and per capita income, is one of the most widely used indicators for gauging a country’s level of human development.

While human development – with its emphasis on improving the lives of people – can be rightly seen as something worth pursuing for its own sake, it is also the case that increases in human development are positively linked with economic growth. This is because investments in ‘human capital’, which can be defined as the knowledge, skills, and other attributes that contribute to an individual’s ability to perform labour, tend to pay off in the form of enhanced economic performance. 

Put more simply, better educated and healthier workers are able to work better and more efficiently than their counterparts who lack those attributes, and are also better suited to adapting to, and taking advantage of, the different opportunities and challenges that arise in a constantly evolving economic landscape. Therefore, when countries focus on improving the lives of their citizens through the provision of better education and health services, they also end up improving the productivity of their workers, yielding greater economic benefits in the long-run. Over time, this creates a virtuous cycle as the economic returns from investments in human development generate the resources required to further enhance human well-being which, in turn, creates yet more possibilities for economic development.

At present, Pakistan lags behind most of its peers when it comes to its levels of human development. In 2018, the country was ranked 147 out of 188 countries on the Human Development Index, putting it a lower position than its neighbors and other countries with similar levels of economic development. However, by focusing on the provision of quality education, especially in a child’s early years, better healthcare and nutrition, teenage and adult education and vocational services, and by facilitating reductions in fertility rates, Pakistan will be able to greatly improve its levels of human development and productivity in the next thirty years.

The Current Challenges

In demographic terms, Pakistan has a relatively young population, which means that the majority of its 220 million people are yet to join the workforce, and will be doing so in increasing numbers in the decades ahead. If harnessed properly, this ‘youth bulge’ can be a powerful driver for economic growth, but it can also be a recipe for disaster if the country fails to grow at a rate that would be able to provide this young population with the jobs and services it would require.

In the status quo, Pakistan is marked by the existence of a high fertility rate, poor reproductive health services, relatively high levels of infant and maternal mortality, inadequate access to nutrition (particularly for the poorest sections of the population),  insufficient access to quality healthcare and sanitation, relatively low levels of school enrollment, a low quality public education system, very low female participation in the workforce, and the persistence of an economy geared towards using low-skilled, predominantly agricultural labor. All of these issues, and more, will have to be addressed if Pakistan is to improve the well-being of its citizens and unleash their potential as agents of economic growth and prosperity.

The Way Forward

When it comes to fostering human development there are a few key mechanisms that, if implemented, can generate tremendous improvements in the well-being and productivity of the citizens of a country like Pakistan. First, it is clear that human development requires greater commitment from the state to invest in the provision of decent health and education services, with the quality of these services being as important as their quantity in terms of the number of people they reach. Second, reductions in fertility rates – defined as the average number of children born to a woman in her lifetime – have positive consequences for human development and economic growth. This is because lower fertility rates are associated with higher female participation in the work force, lower poverty levels, and greater investment in childhood healthcare, nutrition, and education (as having fewer children allows parents to direct more resources towards these areas).

Third, early interventions in childhood development – in the form of early-years schooling and the provision of adequate nutrition – lay the foundations for the attainment of better skills and education in the long-run. Fourth, facilitating the acquisition of education and skills through adolescence and even adulthood allows individuals to further develop their capacity for work and innovation, allowing them to take advantage of the opportunities that might be made available to them for work and entrepreneurial activity in an economic environment geared towards taking advantage of these investments in human capital.

Going forward, it is clear that dealing with the challenges Pakistan faces in terms of human development will require sustained interventions by the state, policy-makers, and other stakeholders. These would have to be premised on engagement with people at the grassroots level, empowering citizens to both articulate their needs and develop an expectation of improved service delivery from their representatives. In addition to investing in the improvement of health and education infrastructure at the different levels discussed above, part of which would have to be the development of better mechanisms through which to monitor the provision of effective services, efforts would also have to be made to address social barriers, such as taboos around female participation in the public sphere or around sexual health, in order to achieve better human development outcomes.

AUTHOR

Dr. Hassan Javid
Dr. Hassan Javid
Assistant Professor, HSS LUMS

REFERENCES