Philippines’s Human Capital Index ranking slips

By Richmond Mercurio (The Philippine Star), June 30, 2016, http://www.philstar.com/business/2016/06/30/1597897/philippiness-human-capital-index-ranking-slips

MANILA, Philippines – The Philippines has slipped three notches in this year’s global report of the World Economic Forum (WEF) measuring countries’ ability to make the most of their populations’ economic potential.

The country ranked 49th out of 130 countries in the WEF’s Human Capital Index for 2016, three positions down from last year’s ranking of 46th.

Within the Asia and the Pacific region, however, the country made it to the top 10 economies that were able to leverage well on their human capital.

The Philippines ranked 8th among Asia and the Pacific economies behind Japan, New Zealand, Singapore, Australia, Korea, Malaysia, and Thailand.

WEF said Cambodia, Lao PDR, and Myanmar trail the region despite a solid performance relative to their income levels.

The Human Capital Index looks at countries’ ability to nurture, develop and deploy the talents of its people from school through to retirement.

The purpose of the report is to help countries assess the outcomes of past and present policies and investments in education and skills, and provide guidance on how to prepare the workforce for the future demands of the global economy.

With 71 percent of its human capital endowment optimized, the Philippines is among the 40 countries in the report that have tapped 70- to 80-percent of their human capital potential.

Despite the three-notch decline, the report showed the Philippines performed progressively better through the age groups, ranking 75th globally for the under 15 years old band, 54th in the 15 to 24 age group, 49th for the 25 to 54 age group, 42nd for the 55 to 64 age group, and 34th for the 65 and over cluster.

“Challenges to address in the key 25 to 54 group is to improve a poor employment gender gap and low labor force participation,” the report said.

Overall, Finland topped the global rankings followed by Norway and Switzerland. All three countries have effectively utilized about 85 percent of their full human capital potential.

Japan came in at fourth, while Sweden was fifth. Completing the top 10 are New Zealand, Denmark, Netherlands, Canada, and Belgium.

“Today’s transition to the Fourth Industrial Revolution, combined with a crisis of governance, creates an urgent need for the world’s educators and employers to fundamentally rethink human capital through dialogue and partnerships. The adaptation of educational institutions, labor market policy and workplaces are crucial to growth, equality and social stability,” WEF founder and executive chairman Klaus Schwab said.