The World Bank launched its first Human Capital Index (HCI) in Bali, Indonesia on October 11, 2018, as part of the World Development Report 2019. The index ranks countries based on their success in developing human capital. The index ranks 157 countries based on their education and health outcomes and the impact they are having on productivity. While Singapore tops the rankings, African countries occupying the bottom spots.
1. The index measures the Index outcomes for each country as a fraction of maximum value of 1.
2. It also 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.
3. Further, 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.
4. Overall, the index found that on an average 56 per cent 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.
Singapore topped the rankings list, followed by South Korea, Japan and Hong Kong. On the other hand, African countries with high childhood stunting rates and low access to formal education fared the worst in the rankings, with Chad and South Sudan taking up the two lowest spots. The United States was ranked 24th on the list, while the United Kingdom was ranked 15th.
The World Bank predicts that in the lowest country ranked on the list, Chad, productivity and earnings potential would be only about 29 per cent of what their potential would be under ideal conditions. In top-ranked Singapore, the earnings potential was 88 per cent of potential, while in the United States, ranked 24th between Israel and Macau, productivity and earnings were measured at 76 per cent of potential.