Human capital at the core of development

1. Introduction

Human capital at the core of development

Human capital—the skills and health that people accumulate over their lifetime—is a cornerstone of prosperity, poverty eradication, and social cohesion. In turn, strong health and education systems are necessary for human capital accumulation and lay the groundwork for countries’ longterm economic success (Flabbi and Gatti 2018; World Bank 2020a).

Even before the COVID-19 (coronavirus) pandemic, many countries were struggling with low human capital outcomes. The World Bank’s 2020 Human Capital Index update shows that, globally, a typical child born just before the pandemic could expect to reach only 56 percent of her productivity as a future worker (World Bank 2020a). This statistic reflects decades of progress in extending life expectancy and expanding schooling access and quality, but it also points to the long road that lies ahead. Persistent gaps in health and learning outcomes between and within countries highlight the need to provide equitable access to health and education opportunities for all. Investing in the health and education pillars of human capital today, in the countries where needs are greatest, will bring both immediate and longer-term benefits (Kim 2018). Failure to make these timely investments will make it harder and costlier to reduce inequalities in the future.