What is Human Capital?

Human capital is a collective term for the workforce that work within and contribute to an organization in terms of the organization’s growth and success. Human capital constitutes the skills, capabilities, resources, knowledge and experiences of the contributing workforce of an organization. Human capital has an intellectual side to it as well, as it includes the thinking, introspecting and creative aspects of the workforce that contribute to growth of an organization.

Human capital is an intangible resource which reflects the economic value of a company’s workforce and their experience and skills. It brings up the notion that workforce skills and abilities all constitute economic returns for the organization; the quality of a workforce’s regular output can be improved by making timely investments in the workforce in the form of trainings and skills developments programs.

Human capital is and its management is critical for an organization as it increases productivity and output of an organization. Greater organizational investment in its employees yields greater workforce output on their part.

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