“No, people are NOT capital. YOUR ‘human capital’ is what you’ve learned and not forgotten. It’s ‘capital’ each person ‘owns’ themselves; FAR more equally distributed than financial capital. Our economy needs institutions to make learning and earning better for those with less money.” —Byron Auguste
In firms that are ‘human capital-intensive’, “Should employees be shareholders?”
With context-specific human capital, the productivity of a particular individual depends not just on being part of a firm, but on being part of a particular group of people engaged in a particular task.
More importantly, once acquired, knowledge and skills that are specialized are assets that are at risk following the very same logic as that by which financial assets are at risk.
Is human capital then conceptually the same as financial capital and should investors in firm specific human capital also be seen as principals? Should employees be shareholders? Should capitalism accordingly create a much larger number of capitalists? —Esko Kilpi
Our human capital is a combination of our skills & knowledge, reputation, and social capital. This social capital is based on expertise and my relationships. Workers — human capital — are multi-faceted complex social beings who create the real value for creative and knowledge-based organizations. The greatest enemies of human organizations are our accounting methods, as I noted in automation + capitalism = a perfect storm. Our bookkeeping practices and capitalist systems are the main culprits in edging out human labour in favour of technological and financial capital.
The foundation for organizational knowledge is the human capital of each and every worker (expertise & relationships). This is increased as people work together (decisions & processes). What the organization sees and accounts for (events & outputs) is only the tip of the iceberg.
To capitalize on our humanity we need to support the flow of ideas and information, couple this with each person’s implicit knowledge, collaborate on worthwhile work, and share what we learn to help make our communities of practice and social networks smarter. Human capital builds not just learning organizations but dynamic and resilient social networks.