January 10th, 2018
Human Capital and the Information Technology and Communications Revolution – conclusion
An increasing challenge in many developed countries has been the development of appropriate levels of human capital to sustain economic growth. This has been a challenge due to aspects such as an aging workforce and low fertility rates. This paper sought to assess how such factors have contributed to the status of Canadian human capital and potential solutions for challenges in developing appropriate human capital levels. Additionally, the paper evaluates how information and communication technology revolution has affected human capital in the global economy.
Challenges that Canada faces in developing appropriate levels of human capital needed to sustain its economic growth include aging population, low fertility rates, early retirement and emigration. However, Canada is at a comparative advantage in solving this challenge than other developed countries with a similar challenge. This arises out of aspects such as a commitment to multicultural society that encourages immigrants who offset the effect of emigration as well as reduce the impact of the aging population. Secondly, by discarding the laws that allow mandatory retirement, the country is starting to have more workers working past their retirement ages thus providing a short term solution to the shortage in human capital. In terms of incentives to increase the fertility rate, a long term intervention, the country has however not made significant gains with the fertility rates projected to remain below the population replacement rate even by 2036.
The influence of information and communication technologies on human capital is evident in two ways. Firstly, such technology has enhanced the outsourcing to low-wage countries thus reducing wage-increase pressure in developed countries. Secondly, such technology has enhanced learning in global regions thus increasing the skill level of individuals in emerging markets. For Canada, the multicultural composition would be a core resource it can use to foster better relations with such emerging markets thus positioning itself to be competitive in the global economy.
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