Human capital valuation and development: prospects and challenges in sri lanka

Abstract

Human Capital plays a prominent role as the major factor in the development of individuals, organisations and countries as a whole. Sri Lanka is experiencing a challenging economic and social environment and moving towards changes in economic growth and human capital mobility. The government and all employers need to rethink recognising and providing appropriate value for the human capital in Sri Lanka. This concept paper aims to provide an overview of human capital valuation and development in Sri Lanka and find out the prospects and challenges. Data was collected through secondary data sources using different reports available in Sri Lanka and at the international level and presented using explanations and descriptions. Based on the information, the review revealed several important areas that would directly impact human capital enhancement in the country. More focus should be given to tertiary and vocational education, labour force participation, unemployment, highskills employment, talent shortage, middle-skills employment, long-term unemployment, public spending on education, employment gender gap, developing more human capital in the areas of health, service and welfare sector to meet the future global job market. At the same time, Sri Lankan organisations should consider valuing their human capital and calculating the Return on Investment (ROI) at the organisational level. Sri Lanka should focus more on catering to the international labour demand related to the professional, skilled, and semi-skilled categories in light of the decline in demand for low-skilled labour in the international labour market.