Why we need a policy to tap human capital

In Economics, the word "Capital" denotes a collection of things very impersonal, like "Produced Factors of Production" (Economics) or "Finances for Acquiring Means of Production". But if we look at the origin, the word capital came from the Latin word for head i.e. caput. So capital is supposed to denote something which has more to do with brain than cash and coins!
This idea is honoured in the rather new, and consequently less well known concept of "Human Capital". So what is human capital? It denotes everything in an anthropic economic agents' brain that's needed for economic value creation: knowledge, ideas, creativity, social and personal characteristics. Some of these are hereditary, but most are learned and acquired.
But what exactly makes human capital so significant? The simple reason is, that this is the foundation for all sorts of activities that lead to economic (and social) progress. Bangladesh is growing at around 6.0 per cent for a decade. This trend is likely to continue, with a slight increase in the growth rate. But given what our neighbours have accomplished already and the lag that we are suffering, is there any room for complacency left? Certainly not.
To accelerate growth, we need to ensure that our potential is utilised to the maximum. But this cannot be attained with millions of youths who could have contributed to the growth of our economy being left unemployable, either due to the low quality of education, or due to a mismatch between demand and supply for specific skills and jobs.
These are exactly the problems our country faces right now! The basis of all of these problems can be reduced to a fundamental cause: a lack of well thought out "National Policy for Human Capital Development". Everybody talks about the great value that education brings to the nation, but no consistent and comprehensive initiative to deal with challenges towards promoting education needed for employment growth and innovation is currently evident in Bangladesh. Here comes another issue: human capital is not just about education, a point which even many experts fail to highlight properly; protecting of intellectual property and incentivising value added innovations must also be included in any such policy response.
Why is such a policy needed? The simple reason is, we live in a globalising world, where everything including human labour is becoming mobile, if not physically at least virtually! Even in our country, where RMG is an economic lifeline, many technical posts are still accessible only to better educated foreign professionals, Bangladeshi technical personnel are not regarded as good enough for competition in a global scenario even by their own domestic employers!
Given such instances of failures, we must realise the situation will become even more critical as days pass by: surplus of unemployable youth, and shortage in the demand side due to low number of qualified candidates competing for jobs. Today, matching outgoing graduates with the jobs available in the economy is a great challenge, not the least because imparting skills necessary to enhance employability is not adequately addressed in our education system, which is largely a heritage of our colonial past. We must have planning on how to optimally allocate our scarce resources to education.
The number of professionals must closely reflects the need for a growing economy, otherwise labour markets with all their imperfections will push for oversupply in lucrative sectors with high earning potential like technical professionals (doctors and engineers), thus driving the wage and quality of supplied manpower down, while depriving societally less well received but still important sectors like blue collar jobs.
Here is another obstacle in the form of social prejudices about a particular job being respectable or not. While countries like Germany have progressed economically by giving proper respect to blue collar jobs like technicians and operators, we are still far from recognising their worth. To power industrialisation and production-oriented economic growth, we need more graduates from polytechnics and vocational schools. But we are still reluctant to send our best kids to these institutions. We, as a society, are shackled by ancient prejudices, which only serve to drag us down.
Apart from education, we need young people with new innovative ideas to come forward as entrepreneurs. But we really cannot attract them to entrepreneurship if the cost of doing business proves to be an obstacle, compounded by corruption in public services and lack of legal recourse in protecting one's property (including intellectual ones) from felons rampaging our country. We need a strong regime overseeing the development of this particular segment of business owners to encourage them and promote them as examples for coming generations to follow.
The good news is that Bangladesh is showing signs of progress; recently we ranked 99th amongst the 124 countries ranked in the Human Capital Development Index published by the World Economic Forum in May 2015, ahead of both India (100th) and Pakistan (113th) but behind Sri Lanka (60th) and Bhutan (87th). Both causes of hope and concerns occur simultaneously in the current events and statistics.
What are the hurdles to pass? For a starter, the amount of investment in creating infrastructure and training manpower for staffing the rank of educators is one. The budget allocation for overall spending in education and technology was lowered from 13.4 per cent of national budget in FY2014-15 to 11.6 per cent in FY2015-16. This figure is a far below what its more successful peers are devoting: India around 14 per cent, Islamic Republic of Iran 21.7 per cent, Malaysia 21 per cent, Thailand 20 per cent, and Singapore 20 per cent.  
Then there comes the issue of quality of education. We can see very clearly the effect of stagnant quality of education from the difficulty students and even teachers faced when the so called "Srijonshil (Creative) Examination System" came into effect. A significant number of teachers was not properly groomed to cope with these changes, which had a bad effect on the morale and performance of the students themselves.
Even this year's Higher Secondary Certificate exam was a disaster, with 9.90 percentage point decline in pass rate (from 75.74 to 65.84), with corresponding slide in other indicators of performance. One of the reasons given for the decline is that boards had to select by lottery question papers for each subject from a set of papers prepared by other boards. Duplications of questions from recent past HSC exams (which students carefully avoids while going through the piles of test papers and guides) was a consequence, and the students paid the price.
To prevent scenarios like this from being repeated, we need to improve the system as a whole, with view to making it more robust. There cannot be any piecemeal solution like the standalone Srijonshil system to deal with this, there must be a comprehensive programme to address the following: emphasis on practical learning, prioritising science and mathematics education, increasing the curriculum breadth and book quality, policy and incentives for making teaching more attractive as a career choice (to attract fresh blood with enthusiasm) as well as advanced training programmes for teachers to help them become better facilitators in the learning process.
The writer is currently working for Eastern Bank Limited as a Management Trainee.
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