Throughout our society, new terms and phrases are always being created. In the last decade or so, the phrase “human capital” began to become more common.
However, as far as its definition: Human capital is the skill, talent, and productivity that employees bring to a company. Coined by University of Chicago economist Theodore Schultz in 1964, the term refers to capital produced by investing in knowledge. In other words, “human capital” infers that a person’s value is based on a person’s knowledge, skills, experience, and how he/she benefits a business.”
Using the phrase “human capital” relays an impersonal perspective of a human being as if you were evaluating a machine and what it can do to benefit a company. The phrase “human capital” does not include their feelings, passion, devotion, dedication, thoughts, etc. “Human Capital” does not take into account the “human” aspect of a person.
It is a way to understand the dollars and cents perspective of an employee or worker, though it still seems cold and totally impersonal. Employees and workers ARE human beings, and thus to try and place an accurate value on any one employee would be difficult, at best. Most workers will have some kind of flaw, and yet they can be very dedicated to their employer, going beyond the “call of duty”.
Bottom Line: Individuals of a workforce will often give more of themselves when trying to benefit or support a caring employer. This is a hard thing to measure, but most employers can attest to seeing this take place. Before using the phrase “human capital”, give thought to how that would sound if referring to you. Are you merely “capital” or a “person”?