Currently, the world has developed only 62% of its human capital as measured by the World Economic Forum’s 2017 Global Human Capital Index.
Or, conversely, nations are neglecting or wasting, on average, 38% of their talent.
Across the Index, there are only 25 nations that have tapped 70% or more of their people’s human capital. These are countries that have set up virtuous cycles around education, work and growth.
The Index ranks 130 countries, covering over 93% of the world’s population, on how well they are developing their citizen’s human capital—the knowledge and skills people possess that enable them to create value in the global economic system.
The Human Capital Report calls for a human-centric vision of the future of work, one where people acquire and use their knowledge and creativity as key drivers of a prosperous and inclusive economy.
There are 5 core global findings of this year’s report.
1. On average, most people in the world today are more and better educated than their parents, no matter where they live.
Over the past century, the world has collectively made an historic investment in the formal education of its now 7.5 billion people.
The global talent pool consists of a growing number of people who hold formally accredited qualifications, as well as advanced qualifications, across an increasingly diverse portfolio of specializations.
The younger generations have more years of formal schooling than older ones almost everywhere in the world.
The world has much to gain from making the best use of the ideas and creativity of this expanding global talent pool.
2. Youth, women and older people still do not get the opportunities they want in most labour markets.
Despite the widespread increase in educational achievement, many people still miss out on an opportunity to apply their skills in the labour market.
Across the globe, the individuals whose human capital potential is under-utilized more often than not fall into one of three groups: women affected by employment gender gaps; older workers who would like to continue working; and younger workers affected by youth unemployment.
Many are starting to turn to new digital work opportunities rather than the traditional workplace.
3. We need to reform education for the next generation. But that alone is not enough. We also need to up-skill the current workforce.
The idea of a one-time education providing people with a lifelong skillset is a relic of the past.
As today’s economies become ever more knowledge-based, technology-driven and globalized, and because we simply don’t know what the jobs of tomorrow will look like, there is a growing recognition that we have to prepare the next generation with future-ready skills and with the capacity for continued lifelong learning.
However, it is imperative that we invest in re-skilling and up-skilling the three billion people around the world who are already part of the world’s workforce and who have already completed formal schooling. For this, public-private collaboration is critical.
4. Too many employers and governments around the world are focused on a narrow talent pool.
We need to dream bigger.
The Fourth Industrial Revolution offers a unique opportunity for all of us to have more interesting, creative and safer work.
It has become the commonly accepted wisdom in many economies that investing in high-skilled labour for a limited sub-section of the population will suffice in fuelling innovation, or that competing on the basis of cheap labour will contribute to economic development, rather than seeking to up-skill their nation’s workforce.
This is a recipe for countries to be disrupted in the Fourth Industrial Revolution.
Even countries that have developed high human capital capacity through formal education, do not offer good-quality skills and know-how-intensive job opportunities broadly to their people.
The Fourth Industrial Revolution can be a unique opportunity to augment a wide range of professions and provide people with new, interesting and safer work.
To meet this potential, we must wholly rethink education and labour policy, including developing a global education infrastructure for on-the-job training and lifelong learning.
5. Business and educational institutions need to deepen their collaboration on education, re-skilling and up-skilling across the globe.
Business must re-think its role as a consumer of "ready-made" human capital.
A number of leading global companies understand this imperative and are already investing in the continuous learning, re-skilling and up-skilling of their employees; but too many companies are still looking at people as a cost to be minimized.
In the short term, this might seem efficient or might pay off for specific companies, but in the long term, it will reduce innovation and reduce social cohesion.
Companies must begin to think of re-skilling and up-skilling their workforces as an investment and a social responsibility.
Deepening the conversation between educators and businesses will be key to ensuring that training across educational institutions provides the skills economies need, the talent needs of businesses, and constitutes a worthwhile investment for individuals themselves.