Human Capital of the New Generation

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Human Capital of the New Generation

• By
• Jorah Ramlan
• ISIS Malaysia

2
Introduction

• Human capital consists of
• Knowledge
• Skills
• Abilities
• Integrity

3
Development of Knowledge

• Support for scientific research,
• Private incentive for RD and innovation,
• Alternative opportunities for talented
  individuals
• Learning-by-doing.
• (Romer, 1996)

4
Sources of Knowledge

• Formal education
• Informal education
• Family influence
• Government support

5
Importance of Human Capital

• Human Capital is very significant to
  growth/development
• New Generation is the source for human capital
• Various types of capital
• Human capital Labour force
• labour force ? human capital

6
Unemployment in Malaysia(Challenge 1)

• More than 50 per cent of the unemployment total
  are young population/new generation
• (age group 15-29)
• (MOHR, 2006)

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Malaysia Selected Employment Statistics 2006
Population 27.2 million
0-14 32.3
15-64 63.4
65 and above 4.3

Employment
Labour force 67
Annual growth 2.6
Unemployed 3.1
New jobs created 1.6 million
Inflation 2.9
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• 220,000 people join the labour force each year
• 44,000 will possess tertiary qualification

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Labour Force Participation 2006
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Quality, Quantity, and Productivity

• Quality and quantity are important for
  productivity
• Quality of human capital refers to education
  level, formal and informal education, worldwide
  marketability
• Quantity of human capital refers to market size,
  consumer spending
• Productivity refers to output per person, Total
  Factor Productivity (TFP),

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Competitiveness Index(Challenge 2)(Most
problematic factors for doing business in
Malaysia)
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Technology and the New Generation
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Labour Force and Productivity(Challenge 3)
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Education and Human Capital

• Education levels and totals 2000-2007
• Increase/decrease effect on human capital

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Labour Market Mismatch(Challenge 4)

• In-demand skills and talents
• Moving up the value chain
• From B grade workers to A grade workers
• Service on-demand
• Competitiveness
• Human capital flight

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Personal and Economic Requirements

• Personal
• Self development
• Financial independence
• Social assimilation
• Economic
• Leadership development
• Strategic investment
• Profitability
• Productivity

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Policy Issues(Challenge 5)

• Youth development policy
• Poor coordination among policies and sectors that
  affect youth and limited accountability for youth
  outcomes
• Weak voice of young people in monitoring and
  providing feedback on the quality of policy and
  service delivery
• The paucity of proven successes

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• Developing a coherent framework and integrating
  it with national policy
• A coherent national framework for youth
• Integration with national policy planning and
  implementation mechanisms
• Building capacity
• Role of the education system

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• Listening to young people
• Maintain an open channel of consultation and
  feedback between government and young people
• Monitoring and evaluation
• Monitoring
• Evaluation

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Conclusion

• Re-evaluation of political, social and economic
  systems incentives and disincentives
• Strengthen formal institutions, social
  organisations and family institutions
• These are the requirements for the development of
  human capital of the new generation

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Developing Human Capital
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• Issues and challenges are dynamic for every
  generation but need to be met for sustainable
  economic growth
• The race for human capital will intensify,
  strategic planning of this resource is essential
• Gestation period for return on human capital
  investment may be longer that other investments,
  hence appropriate measures need to be taken
  promptly
• Human capital and new generation develop it or
  lose it!

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Thank you for your attention