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  • Friday 19, October 2018

World Bank unveils human capital rankings

World Bank unveils human capital rankings

Singapore topped the World Bank Group's newest index which ranks 157 countries based on the productivity of the next generation's workers.

The bank's Human Capital Index was released on Thursday (Oct 11) at the World Bank and International Monetary Fund annual meetings on Indonesia's Bali Island. The rankings, based on health, education and survivability measures, assess the future productivity and earnings potential for citizens of the World Bank's member nations, and ultimately those countries' potential economic growth.

It found that on average 56 percent of children born today will forego more than half their potential lifetime earnings because governments were not investing adequately to ensure their people are healthy, educated and ready for an evolving workplace.

According to the report, a child in Singapore who starts school at age four can expect to complete 13 years of school by his or her 18th birthday.
"In Singapore, 98 per cent of students reach the international benchmark for basic proficiency in secondary school; in South Africa, only 26 per cent of students meet that standard," said the report.

"Essentially, then, all of Singapore’s secondary school students are prepared for a post-secondary education and the world of work, while almost three-quarters of South Africa’s young people are not."

Students in Singapore scored 581 on a scale where 625 represents advanced attainment and 300 represents minimum attainment, according to the report.
The report also showed that children born in Singapore had a survival rate of near 100 per cent, and 95 per cent of 15-year-olds are likely to survive until the age of 60.

World Bank Group President Jim Yong Kim said he hoped the new index would encourage governments to take steps aimed a  moving up the rankings, much as they seek to with the bank´s popular "Doing Business" survey, which ranks countries based on ease of doing business, with low-tax, low regulation economies faring better.

Kim acknowledged that the rankings would be controversial, but told reporters that the need for more and better investment in people was "such that we couldn´t shy away from making leaders uncomfortable".

"This is about drawing their attention to a crisis that we think is real. This is connected to productivity, this is connected to economic growth," Kim said.

He said there was "unanimous" acceptance among World Bank member countries and the bank´s board.

The index measures the mortality rate for children under five, early childhood stunting rates due to malnutrition and other factors, and health outcomes based on the proportion of 15-year-olds who survive until age 60.

It measures a country´s educational achievement based on the years of schooling a child can expect to obtain by age 18, combined with a country´s relative performance on international student achievement tests.

Countries in Africa with high childhood stunting rates and low access to formal education fared worst, while wealthier nations with strong educational systems fared best.
In Chad, the lowest country ranked on the list, the World Bank said productivity and earnings potential would be only about 29 percent of what their potential would be under ideal conditions there.

Kim said there were 28 countries, from Indonesia to Lesotho to Ukraine, who signed on as "early adopters" of the index to work with the World Bank to devise plans to improve their investment in health and education. The bank has warned that a wave of automation and artificial intelligence will eliminate many low-skilled jobs in coming years, making it harder for people with low levels of education and poor health to compete for work.

The index showed that a country ranked at 50 percent, such as Morocco and El Salvador, would lose 1.4 percentage points of annual GDP growth compared to its potential under ideal health and education conditions.



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