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After years of focus on natural resource and financial capital, development of human capital is emerging as one of the central challenges of the 21st Century. At both a macro and microeconomic level, calls for more and better strategies to develop this previously under-appreciated aspect of communities and corporations alike are almost deafening.
If the call has been deafening, the response could be almost overwhelming. Consultants and business academics have unearthed more than 200 key performance indicators and introduced a vast range of accounting and predictive modelling systems to measure these intangible assets.
However, while data can inform, indicate and report, it must be contextualised interpreted and gaps identified. Eidos meets this need by bringing together research evidence and data, and combining it with excellence in research capacity from a range of institutes and organisations to support policy analysis, modelling and scenario development about human capital and productivity.
The development of a focal point for collaboration in human capital data – The Eidos Human Capital Gateway - provides evidence on each stage of the life course, from conception and birth right through to healthy ageing, and for an investment in people that will deliver economic and social benefits. The Gateway is a nationally unique, vital tool that delivers the data which policy makers need to be able to positively influence the way we live, be that through our health, our education or our ability to function as an inclusive society.
An associated research agenda is driven by the Eidos Foundation to fill the gaps and where outcomes are not being acheived, to commission research into innovative new approaches, and to extend the available portfolio of investments into human capital formation.
The Need
Australia generally, and Queensland in particular, has relatively low labour force participation rates by OECD standards, reflecting under-utilisation of its workforce. This is of considerable concern, given that productivity growth has accounted for more than 80% of Australia’s living standards for almost half a century. Long term productivity growth is considered fundamental to the development of a strong and stable national economy. While Australia is rich in natural capital, the under-utilisation of its human capital would suggest significant gains for long-term success could be achieved by informed and strategic investment now.
According to the Productivity Commission, the achievement of higher labour inputs and the employment of those inputs by industry would potentially raise national output significantly above levels that would otherwise be achieved. It projected higher workforce participation and productivity could potentially raise effective labour inputs as measured by quality-adjusted hours worked by around 8 per cent from levels that would otherwise apply. One of the three key areas identified by the Productivity Commission in which reform could contribute to improved labour force participation outcomes was improving the capacity of people to work, through policy measures that improve health, education and training.
Forward-thinking governments internationally are equally committed to investing in human capital to secure the economic future of their countries. The Australian Government has a clear policy to invest in the nation’s human and physical capital. However, according to the Prime Minister, the intent of this policy goes far beyond addressing the decline in multi-factor productivity in recent years. In a speech to the National Press Club in August of this year, he noted, “The Government wants the next generation of Australians to be the best educated, best skilled, best trained in the world. We don’t apologise for this ambition.”
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