The formation of human capital

 For any nation, they can transform physical resources into physical capital such as land turns in factories and many examples are there. It is possible to transform the physical resources like land, gold, etc into capital resources. one can turn the land resources into factory and producing land that is having the potential to generate capital. Similarly, the transformation of human resources into the human capital is possible. It is possible to transform the human resource in generating the capital resources. Human capital is very important for the growth of nation and other benefits as well. even in this digital and highly technologically advanced era, the main source of labour is still human. Even after much advancement, it is still not become possible to replace the human resources with the technology or any machinary device. Nation need sufficient of human capital is one of the major needs for increasing the nation income. Human resources are mainly includes the labour resources, professional and skilled employees, and entrepreneurs.

Now the question rises what is human capital: basically, the people who get education and train as masters in particular felid and other professionals are considered as the human resource. The human resources are defined as humans that helps in generating the capital resources and thus contribute in the growth of GDP of the nation. There is need for the nation to invest more in human resources in ordee for generating more income. In simple way, nation needs to invest more in human capital to generate more human capital out of the human resources. The effective formation of human capital provides great result for life long. Here we understand what the sources for formation of human capital are following. Here in this guide, we will present some sources for generating human resources.

Sources of formation human capital

Human capital is main component for development of the nations. The formation of human development depends on several factors like education, training and many more. Here we discuss the sources of human capital.

High investment in education

Education is primery piller of the formation for the human capital. Education and knowledge helps in training the professional, developing skills in them and thus make them capable of generating capital resources. Spending on education is an investment for future income of economy. Education helps stimulation in productivity as well in humane development. It is easy to learn anything for educated person compare to uneducated person. Education promotes the skill of better understanding, adapting technology and effect on capacity of workers as well. These skills are requiring for growth of nation. Government need to high spend on education for accumulation of human capital. Education is important not only for enhancing earning capacity but also give other valuable benefits. Education provide better social standard, pride, better life choices in life, acceptance for required for changes for society and any more. When the nation invests in education, it is actually making the primary investment for generating great capital in future.

Spending on health

Health is also considering one of the main factor for human capital. health is primary and working for generating the capital is secondary. When the person is Healthy, they are more likely to be more productive and thus can generate more income. People can work with full efficiency compared to sick person. A sick worker who does not have proper access of medical facilities and it will impact on his productivity. Government need provide preventive medicine, curative medicine and also provide basic knowledge regarding health. Government need launch schemes regarding provision of clean drinking water and good sanitation facilities and many more. Expenditure on health is directly enchaining the supply of healthy workforce. Healthy labours contribute in economy production and growth as well.

Spend on training

Every firm needs to spend on training program for their workers and it will enhance productivity and growth as well. This source of human capital is expensive but it will give remarkable results in future. On job training can be the reason of more productivity and also huge profits in firm. On job training is either training the worker under the direction of skilled worker or training under off campus training. These both sources costly but it will give better return in increase in productivity and growth in income as well.


People migration for better job and search for job as well. Unemployment is one of the major reasons rural as well urban for migration in nation for employment. Profession like doctors, engineers and many more also migrated to other nation for better opportunity, high remuneration and many other reasons also. There are several expenses for migration of individuals includes high travelling cost, living coast and so on. The growth in income in the new places overweights the expenses of migration. Migration can be source of human capital.  

Spending on information

People need to spend on obtain information regarding numerous types of jobs. There are several types institutions are providing appropriate skill and supervise for better jobs in certain cost. Spending is necessary for getting information for making accurate Bottom decision for jobs. Business needs to spend on information regarding better labours and skill employees that can help in maintain the growth of business.

The bottom line

These maintained sources transform human beings to human capita. Human capital is the main reason behind the growth nation. I hope this information is help in making of human capital.