Concepts of Human Capital Investment

Lewis Management Consultancy Services focuses on Human Capital Investment to assist organizations in their quest for sustainability, profitability and economic growth.

Schultz (1961) posited that analysts categorize expenditures within three categories: (a) pure consumption, (b) pure investment, and (c) expenditures exhibiting both characteristics when investing in human capital. The two main expenditures Schultz emphasized are education and training, which link investment in human capital to economic growth and accounts for the increase in the actual earnings per worker (Becker, 1964; Saqib, 2015). To enable human capital development to increase employee retention, the executive leaders invest in training for employees to enhance employees’ skills and knowledge (Al-Adwani, 2014b; Pawar & Chakravarthy, 2014).

Khan et al. (2015) agreed that training related to the individual is a significant element of human capital investment. In addition, expenditures on education, training, and work-related benefits contribute to increasing efforts by workers (Neagu et al., 2016; Salau et al., 2016). Although education and training are the most cited expenditures in human capital research, human capital investment includes work experience and job searches (Saqib, 2015).

By Dr. Thela Fitz-Lewis- Head Consultant (Lewis Management Consultancy Services)

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