Human capital has emerged as a key component of Sustainable Development and Economic Growth in the rapidly advancing global environment of today. Investing in human capital is not only advantageous but also essential for addressing Nigeria’s complex concerns, as the country has enormous potential but beset by various hurdles. According to recent studies, Nigeria’s growth rate is approximately 3.0%. This suggests that although the country has enormous potential, it is more imperative for it to to closely coordinate its policies and investments in order to realize this potential.
The World Bank highlights that for countries to prosper in an ever-more competitive global economy, Investment in human capital is crucial. With one of the youngest populations in the world, Nigeria stands to gain economically and creatively by harnessing this potential. Nigeria has a varied capacity for human capital. On the one hand, the nation has a young population—more than 60% of its residents are under 25. However, the nation has enormous obstacles, such as subpar healthcare, high Unemployment rates, and poor Education systems.
Government ought to revamp the educational system.
As per the World Bank’s 2023 Human Capital Index (HCI), Nigeria was placed 163 out of 174 nations, meaning that children born in Nigeria today will only be 36 percent as productive as they could be if they had access to adequate healthcare and standard education. According to reports, Nigeria’s Educational System struggles with inadequate facilities and a Curriculum that frequently does not correspond with industry demands. Over 10 million Nigerian children, according to UNICEF, are out-of-school, which hinders the nation’s ability to produce a trained labor force.
Boosting human capital investment has the potential to revolutionize Nigeria. Focusing on health services, education, and Vocational Training can help the nation address a number of critical issues, including lowering unemployment, promoting economic growth, and enhancing healthcare. Nigeria needs to adopt a number of strategic steps in order to properly leverage its human capital. In order to better meet the demands of the contemporary economy, the government ought to revamp the educational system to emphasize technical skills, creativity, and critical thinking. Partnerships with the Private Sector can improve the educational programs’ relevance.
Several factors combined to affect Nigeria’s capacity.
A report released by the International Monetary Fund (IMF) indicates that nations that allocate resources towards human capital have a higher probability of attaining sustainable growth and lowering Poverty rates. As per the report, an individual’s salary might rise by as much as 10% for each extra year of education, a fact that is especially pertinent in the context of Nigeria. Furthermore, according to the Nigerian Economic Summit Group, focused investments in health and education might result in returns of up to 12% per year, proving that the financial advantages of investing in human capital considerably exceed the adverse aspects.
In comparison to Nigeria, several African countries have made notable progress in investing in their human capital, yielding quantifiable economic gains. Rwanda, Ghana, Kenya, and South Africa are currently setting the standard for utilizing human resources to drive economic progress, even though Nigeria has the necessary components for the development of human capital. A number of factors combined to affect Nigeria’s capacity to properly leverage its Human Resources making the gap more pronounced. Particularly, the high percentage of unemployment among Nigeria’s teeming youthful population is concerning.
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Additionally, Nigeria needs to make a concerted effort towards advancing health, education, and vocational training in addition to creating an atmosphere that encourages entrepreneurship and Innovation if it is to level up. Through prioritizing education, health, and skill development, Nigeria can leverage the potential of its youthful populace, propel economic expansion, and enhance the standard of living for its populace. The government, business community, and Civil Society must work together to make human capital development a top priority on the national agenda in order to move forward.