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Human capital development key to economic growth

BY VINCE MUSEWE

I am writing on the issue of human capital development because it seems that most African countries have not awakened to the fact that at the centre of everything must be people.

As long as we continue to treat our peoples as liabilities which must be exploited and not assets which must be nurtured and developed, the continent will not develop to our full potential despite having prodigious resource endowments.

Human capital development refers to processes that relate to training, education and other human capacity building initiatives in order to increase the levels of knowledge, skills, abilities, values, and social assets of the citizens of any country.

Developed countries have become developed through continuous investment in research and skills development while Africa continues to underinvest in its future.

Differences in economic growth across countries have become closely related to cognitive skills and unless we focus on developing these, we will remain underdeveloped operating much below our potential capacity as a continent.

“A highly developed human capital base will be the source of competitive advantage in the twenty-first century global economy.

“Human capital, or the education, skill levels, and problem-solving abilities will be the competitive advantage of nations because they enable individuals to be innovative and productive in a highly competitive global economy.”

It is, therefore, essential for us in Zimbabwe to invest in this and to also rethink our economic growth strategies if we are to be a competitive nation in the future.

The rapid expansion of new digital technologies requires a totally different approach to human capital development.

Countries must now focus more on the quality of education as opposed to mere access to education.

Expansion of school attainment has not guaranteed improved economic conditions especially in developing nations.

It is critical that we look at quality of education and not quantity. We need a new approach.

The developed world is now dominated by brain-intensive industries which include, among others, computers and software, robotics and machine tools, microelectronics, materials sciences, biotechnology, and telecommunications.

What used to be primary (inventing new products) has become secondary, and what used to be secondary (inventing and perfecting new processes) has become primary.

These require significantly different skills than the past.

Asia is a clear example where reinventing new products and perfecting new production processes has created significant economic growth. Africa should do the same.

Unfortunately in Africa, according to the African Development Bank, most economies continue to compete on the basis of factor endowments, with growth dependent primarily on low-skilled labour and natural resources.

Moving up the value chain to more efficient and innovation-driven economies is therefore essential to increasing and sustaining economic growth.

In order to achieve this, we will require high-impact investments in education, science and technology.

A vibrant private sector is key for creating jobs, producing and marketing sophisticated goods and services and latching on to global value chains. Further, improving the quality and inclusiveness of growth will require more citizen participation and greater accountability from public service providers to offer value for money as well as safety nets to build resilience to economic and social shocks and move poor individuals and communities out of poverty.

We desperately need to focus on rapid industrialisation because, by simply focusing on redistributing incomes and resources, we will not achieve long term objectives of job creation and poverty alleviation.

One of the key prerequisites of re-industrialisation of Zimbabwe requires a high human capital skills base.

The suggested 10 key points to put Zimbabwe on a new human capital development trajectory include:

  •  The development of skills and technology for competitiveness
  •  Revision of our education system to help build a competitive workforce.
  •  Investment in ICT infrastructure projects.
  •  Promotion of enhanced skills in Science, Technology and Mathematics.
  •  Investment in research innovation and connection to global knowledge systems.
  •  Establishment of innovative teaching methods based on ICT.
  •  Implementation of curriculum reforms  that take into account global developments.
  •  Broadening of the capabilities and economic opportunities of youth women and girls.
  •  Support of inclusive financing systems, including safety nets, microfinance and social entrepreneurship.
  •  Working towards establishing universal access to affordable health.

Zimbabwe can certainly leap frog its neighbours through the application of new innovative technologies that increase production volumes and therefore exports.

Our education policy must, however, match our economic and social developmental objectives.

We must strengthen research institutions to support our developmental priorities particularly in the agriculture, energy, technology, services and mining sectors.

The rapid expansion in urban populations due to the decimation of the rural agriculture sector occurred without expansion in basic services and productive employment opportunities.

We need to improve deteriorating infrastructure, increase service delivery capacity, reduce overcrowding, curtail environmental degradation and reverse acute shortages of housing and productive jobs. These are critical human capital development issues.

Added to this is the necessity to attract Zimbabweans in the Diaspora back home so that they may be involved in the development of the country.

We will need to incentivise them to come back and provide a soft landing for returnees.

We must urgently promote economic freedom in the country and create an environment of entrepreneurship and risk taking.

This can only happen if we ensure that there is the protection of private property and intellectual capital.

We must also focus on increasing our productivity and competitiveness as a country through continuous learning, research and the adoption of new technologies.

This requires that we incentivise companies to continuously train and develop employees and increase their productivity so that we can be a competitive nation.

With regard to creating an enabling environment and a social safety net, our policies must consider a welfare system that is affordable.

This new welfare regime must focus on social interventions to assist the disadvantaged and the marginalised is important.

For example, the decimation of pension funds during hyperinflation has resulted in significant portion of the older generation suffering due to lack of income.

The brain drain has destroyed family structures resulting in child led homes and a deterioration in moral values.

The lack of employment opportunities has led high social costs, to prostitution of young girls while young boys are resorting to drug use to ease the pain.

The Covid-19 pandemic has further exposed the lack on investment in the collection of social data so that we can protect our human capital base.

All these social ills need attention and the creation of appropriate safety nets to limit the social decline.

Our political and economic institutional arrangement need to ensure that all policies put people first and that adequate resources are ploughed into the development of human capital which can compete in a future that is digital, complex and dynamic.

Without this, we will remain an underdeveloped economy characterised by wide spread poverty and a deteriorating quality of life for many.

  • Vince Musewe is an economist you may contact him on vtmusewe@gmail.com.
  • *These weekly articles are coordinated by Lovemore Kadenge, independent consultant, past president of the Zimbabwe Economics Society and past president of the Institute of Chartered Secretaries and Administrators in Zimbabwe (ICSAZ.  Email: kadenge.zes@gmail.com and mobile No. +263 772 382 852

 

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