Human Capital

Posted in Human Resource Terms, Total Reads: 1199

Definition: Human Capital

Human capital is the asset that an organization has in form of its employees. It takes into account the value that the knowledge, skills and experience of the employees adds to the organization. The skills are acquired by an employee on the job, or through training. With the addition of skills the human capital increases.

The concept of human capital recognizes that all kinds of employees and the value that they add to the company is not the same. For example: The value of human capital of a worker is different than the value of human capital of a senior executive.

Human capital management is the responsibility of the HR department of an organization. This includes staffing and training the employees to increase the human capital.


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