Talent, not capital, will be the key factor linking innovation, competitiveness and growth in the 21st century, and we must each understand better the global talent value chain. Better data and metrics are critical to this understanding.
The Human Capital Index quantifies how countries are developing and deploying their human capital and tracks progress over time. The World Economic Forum’s Human Capital Report provides comprehensive information on the talent base in each country, including information on education levels of the employed, unemployed and the inactive members of the population as well as the specific qualifications of the latest entrants to the workforce.
When it comes to developing people’s talents and helping them reach their full potential, the concept of a world where no one is left behind remains a distant prospect. This is the case even in rich countries with well-developed educational systems and robust employment.
The index takes a life-course approach to human capital, evaluating the levels of education, skills and employment available to people in five distinct age groups, starting from under 15 years to over 65 years. The aim is to assess the outcome of past and present investments in human capital and offer insight into what a country’s talent base will look like in the future.
Globally, Finland tops the rankings of the Human Capital Index in 2015, scoring 86% out of a possible 100. Norway (2), Switzerland (3), Canada (4) and Japan (5) make up the rest of the top five. They are among a group of only 14 nations that have crossed the 80% threshold.
Among other large advanced economies, France is in 14th position, while the United States is in 17th position, scoring just under 80%. The United Kingdom holds the 19th spot and Germany 22nd. Among the BRICS, The Russian Federation (26) scores highest with a score of 78%, with China next at 64, having optimized 67% of its human capital. Brazil is in 78th place, followed by South Africa (92) and India (100).
In addition to the 14 countries that have reached 80% human capital optimization, 38 countries score between 70% and 80%. A further 40 countries score between 60% and 70%, while 23 countries score between 50% and 60% and nine countries remain below 50%.
“Talent, not capital, will be the key factor linking innovation, competitiveness and growth in the 21st century. To make any of the changes necessary to unlock the world’s latent talent – and hence its growth potential – we must look beyond campaign cycles and quarterly reports. Dialogue, collaboration and partnerships between all sectors are crucial for the adaptation of educational institutions, governments and businesses,” said Klaus Schwab, Founder and Executive Chairman of the World Economic Forum.
Results by Region
In addition to Finland, Norway and Switzerland, which occupy the top three spots overall, another four countries from Europe and Central Asia occupy the top 10, while another eight from the region are among the top 20. Albania (66), Turkey (68) and Moldova (71) hold the last places within the region. Italy (35), Greece (40) and Spain (41) are buoyed by their past human capital investments but are hampered by relatively low scores on quality of education measures, lifelong learning opportunities, labour force participation rates and unemployment.
In Asia and the Pacific, where the majority of the world’s population is concentrated, the spread between the highest and lowest performing countries is among the widest. After Japan, the best performing countries are New Zealand (9), Australia (13) and Singapore (24), while Nepal (106), Myanmar (112) and Pakistan (113) occupy the lowest positions. After China and India, the region’s third most populous nation, Indonesia, holds the 69th spot. Iran is in 80th position.
Chile (45) and Uruguay (47) are Latin America and the Caribbean’s human capital leaders. Argentina (48) and Mexico (58) follow next. Brazil, the most populous country in the region, is in 78th place. Nicaragua (90), Venezuela (91) and Honduras (96) occupy the last spots in the region. Overall, the gap between the best and worst performers in the Latin America and the Caribbean region is smaller than in other regions. While high-skilled employment is in the range of 20% of the workforce across the region, in several countries, such as Uruguay and Brazil, businesses perceive difficulties in finding skilled employees.
In the Middle East and North Africa, Israel (29) leads the way, followed by the United Arab Emirates (54) and Qatar (56). Jordan (76) and Egypt (84) outperform higher-income economies like Saudi Arabia (85) and Kuwait (93). Morocco (95) and Tunisia (98) follow next, while Algeria (114), Mauritania (122) and Yemen (124) hold the last spots in the region.
In sub-Saharan Africa, Mauritius (72) holds the highest position in the region. While another six countries rank between 80 and 100, another 17 countries from Africa rank below 100 in the index. South Africa is in 92nd place and Kenya at 101. The region’s most populous country, Nigeria (120) is among the bottom three in the region, while the second most populous country, Ethiopia, is in 115th place. With the exception of the top-ranked country, the region is characterized by chronically low investment in education and learning.
Results by Income Group
While the overall country scores are generally correlated with the GDP per capita, there are differences and overlaps between income groups, with some lower-income countries far outperforming richer ones.
Within the low income group, countries with a GDP per capita under $1,045, Tajikistan (65), Cambodia (97) and Bangladesh (99) perform well ahead Burundi (121) and Chad (123), the lowest-ranking countries within this income group.
Within the lower-middle income group, countries with a GDP per capita between $1,045 and $4,125, Ukraine (31), Armenia (43), Kyrgyz Republic (44) and the Philippines (46) place well ahead of Nigeria (120), Mauritania (122) and Yemen (124).
Within the upper-middle income group, countries with a GDP per capita between $4,126 and $12,745, Hungary (32), Kazakhstan (37) and Romania (39) rank at the top of this group, while Namibia (94), Tunisia (98) and Algeria (114) hold the last three spots.
Among the high income countries, those with a GDP per capita above $12,746, Finland, Norway and Switzerland hold the top three spots in the index overall. Barbados (77), Saudi Arabia (85) and Kuwait (93) hold the last three spots.
Business and Policy Implications
In addition to the index, the report provides the latest available information on the numbers of current and recent graduates in major fields of study in each country and detailed information on the population’s workforce activity as well as levels of education.
“Our goal is to support business leaders, policy-makers, civil society and the public in taking the informed, data-driven decisions that are needed to unlock human potential. The index shows that all countries – both rich and poor – have yet to optimize their human capital and calls for a new people-centric model of growth,” said Saadia Zahidi, Head of the Employment, Skills and Human Capital Initiative and co-author of the report.
The report and index were produced in collaboration with Mercer. “The Human Capital Index is a critical tool for global employers,” said Julio A. Portalatin, President and Chief Executive Officer of Mercer. “It allows them to determine the most pressing issues impacting talent availability and suitability around the world today and identify those issues that have the potential to impact business success in the future – invaluable insight for guiding the allocation of workforce development and investments.”
The Human Capital Index ranks 124 countries on how well they are developing and deploying their human capital, focusing on education, skills and employment. It aims to understand whether countries are wasting or leveraging their human potential. The report measures this distance from the ideal – or waste – by disaggregating data across five age groups to capture the full demographic profile of a country:
•Under 15 years – the youngest members of the population for whom education is assessed among the most critical factors
•15-24 years – youth for whom factors such as higher education and skills use in the workplace are assessed
•25-55 years – the bulk of the labour force, for whom continued learning and employment opportunities are assessed
•55-64 years – the most senior members of most workforce for whom attainment and employment opportunities are assessed
•65 and over years – the oldest members of the population, for whom both continued opportunity and health are assessed
The generational lens sheds light on age-specific patterns of labour market exclusion and untapped human capital potential. In total, the Human Capital Index covers 46 indicators. Values for each of the indicators come from publicly available data compiled by international organizations such as the International Labour Organization (ILO), the United Nations Educational, Scientific and Cultural Organization (UNESCO) and the World Health Organization (WHO). In addition to hard data, the index uses a limited set of qualitative survey data from the World Economic Forum’s Executive Opinion Survey. The methodology also allows for comparisons within a country as well as between countries.
The Human Capital Index is among the set of tools provided by the Forum as part of its global initiative on Employment, Skills and Human Capital. The initiative produces analysis and insights focused on forecasting the future of jobs across major industry sectors as well as best practices from businesses that are taking the lead in addressing the skills gaps and unemployment. The initiative also creates public-private collaboration on jobs and skills in several regions of the world and within industry groups, with a focus on involving business in supporting education, lifelong learning, skills development and entrepreneurship.
Conversion of Local Business into E-Business by Effective Use of Social Media
The spread of coronavirus (Covid-19) has affected almost all areas of life. The whole world is facing a crisis because of this pandemic issue. A lot of people have lost their jobs and many are struggling to survive in this situation. All businesses whether working at a large scale or a small scale are facing problems due to the unavailability to resources to operate businesses successfully. The developed countries are somehow managing this situation because of the successful implementation of online businesses from a long-time period. So, for those countries both customers and businesses are relatively ok with the situation by not going in the markets to buy things and place orders online and get it delivered at the doorsteps easily.
Whereas many developing countries like Pakistan have certain barriers in the full acceptance of e-business offered by the local and international companies. As per many studies on this topic, there are a lot of factors that pose hindrances in full acceptance of e-commerce in Pakistan. However, there is one thing worth mentioning that these hindering factors are related to all stakeholders. A few of those factors include insufficient technological resources, Government Policies, legal issues, social acceptability of the online shopping trend because of trust issue between companies and customers whether in terms of provided customer information at online shopping platforms, payment security, or the difference in shown and finally delivered product at customers doorstep, etc. But there has been seen a change in this trend in a couple of years with the development of the telecommunication industry. As most of the people now days have internet access at their places and are following social trends all around the world. So, the trend on online shopping from official brand stores’ websites has developed rapidly due to the trust of customers in brands’ shown and delivered products on their official online websites. But as far as local businesses and third party online shopping websites are concerned they are still a certain group of people consider taking a chance to shop online.
In the pandemic situation, as all the markets were closed due to the lockdown in the country, everyone was worried about the situation whether a businessman or a customer. In this crucial time of survival, there has developed a new trend of conversion of local businesses into e-businesses by using social media effectively. Here are those businesses are under discussion who are owned by the people who are not mostly educated enough to know the value of effective use of social media or those people who even being educated at a certain level didn’t think before that they can utilize social media for their businesses to operate when everything was closed. Talking about the customers who were conscious about all the factors of trust and all before were just considering one thing and that was the availability of their desired products at their doorstep in their required time frame. Somehow, like big brands and businesses, many small businesses managed it quite well and provided online shopping facilities to the customers.
In the period of locked down, these small local businesses used social media i.e. Facebook, Instagram, what’s app, LinkedIn, etc. to display their products online offering discounted prices and free home delivery. This step not only provided them the opportunity to earn money in the time of crisis but also put the foundation of new trends in online shopping i.e. the acceptability of online shopping in the society even in the smaller and backward areas of Pakistan. We hope that this conversion of local businesses into e-businesses will continue to flourish successfully in the future and the acceptability of online shopping in Pakistan will grow over time. Here, in the end, one thing that matters is that all the stakeholders should play their effective role in this growth especially the Government should make policies to support the effective implementation of online business trends in Pakistan.
Impact of COVID-19 On Somalia’s Economy: Will the virus be a springboard to severe crisis?
The COVID-19 pandemic imposed unprecedented challenges to global health systems and economies and transferred to Somalia one of the poorest and susceptible to crisis economies of the world. The economy of Somalia was already severing due to structural deficiencies and lack of unity. The federal-level economic institution such as the ministry of finance, ministry of trade, and central bank are mainly residing in Moqdisho and have no capacity to extend their services to other regions. The central bank is not yet ready to function properly. It does not have the capacity to innovate suitable economic policies to stabilize the country’s currency value, prevent hyperinflation, and keep unemployment lower. In addition, the nation’s taxation procedures and revenue collection policies are not unitary. The regional states have autonomous economic and political institutions with different taxation and revenue maximation policies. In terms of employment, the state employs to a small fraction of the nation’s labor force compared to the private sector. Therefore, considering all these facts one may conclude state plays a negligible role in the economic activities of the country.
The nation’s economy has been massively relying on foreign aid, remittance revenues, and import. The budget of the federal government and running costs are mainly financed through budget supports and other forms of assistance from donors. Almost every Somali household receives income from her overseas family member, especially Europe and the USA. Hence, remittance revenue is the lifeblood of the Somali household’s economy. On the other hand, Somalia is one of the countries with the largest trade deficit in the world, imports extremely surpass over exports. Since the livestock industry, the nation’s export backbone has been blemished by continual export bans from Saudi Arabia, the nation ended up an entirely import-dependent economy.
The foreign aid, remittance revenues, and import are not reliable sectors because they are prone to global shocks such as political clashes, trade wars, and pandemics. For instance, COVID-19 pandemic adversely affected Somali remittance firms. The Somali remittance firms source funds from western countries where COVID-19 is massively damaged both human and economic. These countries have been executing a complete lockdown to fight against and attenuate the spread of the virus among the community. The business, schools, universities, and public transportations were completely closed. So, this instigated Somali immigrants in Canada, the USA, and EU countries to lose their jobs and not able to send money back home. Remarkably, Somali immigrants in Europe and the USA are one of the highest deadly effected diasporas by COVID-19.
The World Bank estimates show that Somalia receives nearly US$1.4 billion remittance annually which contribute 23% of the nation’s GDP. Although Somali remittance firms in western countries have been victimized by money laundering and terrorism involvement allegations, however, still remain dominant in the nation’s basic financial service and recently annexed to banking and real estate. The lockdowns in western countries due to COVID-19 have reduced the smooth follow of remittance funds and this may have a deleterious effect on household’s livelihood, families may not able to pay utility expenses. The reduction of remittance funds means people will have no cash to buy things and small business which employ a significant share of the nation’s formal and informal workers will face critical financial crisis.
Most affected areas
It is very difficult to capture the impact of COVID-19 on economy like Somalia where financial data is hardly available in public. However, the World Bank expressed concern that the pandemic may reverse decades of economic progress and poverty alleviation in the world’s poorest regions like Sub-Saharan African countries. World Bank recently estimates projects that the Sub-Sahara region could lose around $79 billion in output in 2020. In fact, Somalia will be one of the highly affected states in the region. Somalia could not impose a complete lockdown strategy, but schools, universities, local and international flights have been closed. The Khat or Qat (stimulant and flowering plant native to East African and Arabian Peninsula) import was temporarily banned.
The education sector of Somalia which is 95% private has been extremely devastated by Corona Virus (Covid-19). The primary, intermediate, and secondary school teachers have lost their salaries since tuition fees are paid monthly. The Madarasa (Koranic School) teachers also have lost their jobs and the lives of their families are endangered to die for hunger and underfeeding. There are no safety packages, food, and cash distribution to ameliorate the deteriorating economic situation of Somali teachers.
The Federal government of Somalia has banned the import of Khat in a bid to reduce the spread of Corona Virus across borders with neighboring countries, this sends a paroxysm of anger and frustration to thousands Khat traders, and street based Khat small business. The Khat is a paradoxical business, on one hand, it employs a significant share of the nation’s informal workers, and it is the only source of income for many destitute and vulnerable families like internally displaced families, and widowed women with children. It is also the mainstay of the government’s source of tax revenue. On the other hand, anti-Khat campaigners argue that Khat drains the economy and destroys the family. In fact, the ban of Khat import policy immediately impoverished thousands of families whose livelihood depends on directly or indirectly to Khat business. The government has not yet come up with any initiative to refurbish the lives of these hopeless families and workers.
The health impact of COVID-19 on Somalia is not as nasty as predicted and expected. Somalia has confirmed only 2944 cases and 90 death cases so far, although the testing rate is very limited and some of the fatuous test result cases were reported in the media. However, a country like Somalia where social protection programs, unemployment insurance benefits, and other welfare schemes are not even in the dictionary of the society deep economic downtown is imminent and unavoidable amid COVID-19 pandemic. As long as the 23% of the GDP of the country is remittance revenues from the west so any possibility of second wave pandemic that can outburst and prolong lockdown in western countries will have a catastrophic short- and long-term impact on Somali Economy.
China is the Africa’s main trade partner, especially Somalia’s business community extremely depend on Chinese markets. The full lockdown on Chinese economy and ban of international flights significantly reduced imports from china to Somalia. This skyrocketed the most of food and basic stuff prices. Somalia cansimply face food insecurity, if second wave of COVID-19 hits China again and Chinese officials prolong lockdown period. By the time I’m writing this opinion essay, china is struggling a new swine flu virus. This is not only bad news to Chinese economy but also to Somali economy.
Possible options for economy refurbishment
COVID-19 pandemic presenting aberrant challenge to the Somali Economy amid Somalia is expecting full debt relief from the international creditors. The debt relief program will enable the country to get developmental aid, and non-concessional loans. The government should speed up the debt relief program to get loans and developmental aid to improve the lives of citizens impoverished by the COVID-19 pandemic.
The government should consult with individual donors and international financial institutions to design the kind of foreign assistance Somalia needs for economic recovery in the post-COVID-19 pandemic era. The government should allocate a significant amount of foreign assistance it received to income generation projects for internally displaced people (IDP). The government cooperating with local business communities and international NGOs should set food distribution packages to vulnerable workers such as teachers, unskilled construction workers, widowed women with children, Kat workers, and so on.
Policymakers should direct international NGOs to implement small business development and income generation projects in villages, districts, and regions where poor and susceptible communities are inhabited.
The government in partnership with international donors and local investment banks should prepare soft loans and investment mechanisms suitable to poor farmers to promote local production efficiency. Small business development, fishing and agriculture, training and skill development, and empowering women and poor farmers oriented international and local projects will lead to favorable economic growth in the post-pandemic era.
Transformation of E-Commerce Businesses and their Future after COVID-19
World has witnessed an unprecedented human destruction caused by Covid-19.As on 7th July 2020, the virus has taken 533,780 lives and 11,419,529 have been tested positive worldwide. It started in December 2019 when Wuhan Municipal Health Commission China reported cluster of pneumonia cases which was eventually identified as novel coronavirus. On 5th January 2020, World Health Organization (WHO) made a flagship technical publication for Global Media as well as scientific and health communities on the first ever aperture on disease outbreak of new virus. Later on WHO declared health emergency worldwide and issued public health advisory when a large number of cases were reported outside China.
Subsequently, governments across the globe started taking precautionary measures to contain the infection rate which included lockdowns, border restrictions and even economic activities were strictly restricted. People themselves started opting for social distancing to avoid potential contagion and physical proximity. On the one hand this strategy has proved as the best measure to reduce the rate of infection but on the other, due to minimal economic activities, economies of many countries have been badly affected. Barring essential businesses like food and grocery etc., every other business got effected. Thousands of traditional style businesses and companies were severely affected and lot of them even went bankrupt.
In these circumstances, E-Commerce appeared as a promising major pillar in fight againstCOVID-19 as it helped reduce the rate of infection by offering online delivery of commodities and services. Supermarkets started online delivery of groceries by providing door-to-door services to their customers, preventing risks of in-store visits and subsequently online payments obviated in-person cash transactions.
Moreover, E-Commerce helped economies in preserving jobs during crisis. Online businesses strived to maintain the basic revenue stream which helped them to get their businesses afloat through the crisis. Restaurants and famous food chains started offering online takeout services. Almost all famous brands of clothing, shoes and many others, transformed their business from traditional to online.
Many companies changed the nature of their businesses and were successful in creating new jobs as consumers shifted towards online offerings. Recently a Dubai based raw coffee supply company transformed its business from B2B to B2C due to emerging demand of consumer products.
Interestingly many new small level ventures were set up during this period. People started delivering homemade food and home grown fruits and vegetables to meet the needs at both ends and the response from their customers is most encouraging. These continued availability of consumer goods helped the governments to increase the acceptance of persistent physical social distancing measures among masses.
Lockdown orders will definitely be lifted eventually but there are thousands and millions of customers whose patterns of purchase have changed drastically for a more comfortable way of getting what you need at your doorstep. They are comfortable with the online system not only for their convenience but also for getting into any risk of catching the virus. According to a recent survey on social media, young consumers are more motivated than ever to maintain social distancing and shop online while staying at home. This trend is creating ideal market conditions and great motivation for newly entrant digital entrepreneurs.
The trend of changing customers’ buying habits and behavior is an opportunity for digital entrepreneurs. Now how they react,it is the future of e-commerce that will be the deciding factor. Once the situation improves, sales of E-Commerce industry may stabilize at low growth rate than today but the changing behavior of customers is already in action to overall change the retail and commerce for years to come.
Commission sets out plans for the energy system of the future and clean hydrogen
To become climate-neutral by 2050, Europe needs to transform its energy system, which accounts for 75% of the EU’s greenhouse...
Conversion of Local Business into E-Business by Effective Use of Social Media
The spread of coronavirus (Covid-19) has affected almost all areas of life. The whole world is facing a crisis because...
The effect of COVID-19 and the 4IR on integration within global value chains
The Global Manufacturing and Industrialisation (GMIS) Digital Series 2020 kicked-off with a high-level panel webinar addressing “glocalization: localizing production and...
The Ways People Have Fund with Oligarchic Democracy in Indonesia
Democracy is the lunch of Indonesia’s politicians. The law (rule of law) is the dessert. At night, they turn political...
Impact of COVID-19 On Somalia’s Economy: Will the virus be a springboard to severe crisis?
The COVID-19 pandemic imposed unprecedented challenges to global health systems and economies and transferred to Somalia one of the poorest...
Rapidly changing behaviours are accelerating consumer embrace of digital and health trends
The acceleration of consumer trends and behavior that was already underway prior to the COVID-19 outbreak has taken another leap...
Does Turkey Plan Revenge for Al-Watiya Attack?
On Monday, July 6th, Turkish Defense Ministry declared that it plans to conduct large-scale military exercises. The Turkish Air Force’s...
Africa3 days ago
How ultranationalist rhetoric is stalemating the GERD dispute?
Defense3 days ago
Turning Gulf Security Upside Down
Americas3 days ago
The USMCA Agreement: A New Era in Mexico-US-Canada Relations?
Defense3 days ago
Could India’s Diplomatic Outreaches Be a Success amid Heightened Border Tensions?
Economy2 days ago
Transformation of E-Commerce Businesses and their Future after COVID-19
Newsdesk2 days ago
U.S. Now Past 3,000,000 Covid-19 Cases- World Nears 12,000,000 Cases
Southeast Asia2 days ago
A Story about a World Heritage in Bali
Middle East2 days ago
Has Turkey Colonized Libya?