Human Capital

Human capital is highly valued throughout the world and each individual should be interested in raising their human capital to its highest possible level. “Human capital is the sum total of skills embodied within an individual: education, intelligence, charisma, creativity, work experience, and entrepreneurial vigor (Wheelan pg 127).” Great thinkers and political leaders have reflected societal views of human capital throughout history. Different industries use perceived human capital to choose people that will be useful to their organizations. Three areas where human capital is carefully examined are the immigration department, universities, and average employers. Each of these values the human capital of their applicants in somewhat similar ways. In the United States human capital is valued and thoroughly considered when the immigration department considers each candidate for citizenship. Also, during an admissions process, universities are often influenced by particular backgrounds and the intended studies of their future students. A potential employer will desire to know that the candidate being considered for employment has intelligence and good work experience. Both of these factors illustrate the applicant’s human capital.

An increase in human capital indicates a rise in productivity and therefore a rise in standard of living. The United States as compared to its global competitors has a significant amount of human capital in the majority of its citizens.  In fact, the United States is ranked third in the world for its standard of living.

“Those who educate children well are more to be honored than they who produce them; for these only gave them life, [while] those [gave] the art of living well (Aristotle).” This quote expresses Aristotle’s belief in investing in the human capital of one’s child. By doing this the parent is not only giving their child life but the quality of life. This quality of life would then extend into the next generation and the generations after that. Aristotle’s philosophy has been embodied by many of the parents throughout the generations who want to give their children everything the parents themselves never had.

            Different types of people however have different ideas of what makes a human valuable. Take Adolf Hitler for example. He believed that to have value one must be a pure German with blonde hair, and blue eyes. On the other hand, if one was Jewish, in Hitler’s eyes, one had lower value than the dirt under his shoe. Now this is Hitler’s opinion of the human capital of a Jewish person or an imperfect German. Conversely, other Jews would hold a Jewish rabbi in high regard and his knowledge of his religion gives him a high human capital. Human capital has a lot to do with the perspective of the person judging another person’s value. 

            “The value of a man should be seen in what he gives and not in what he is able to receive. (Albert Einstein)” Einstein believed that the value of man was in one’s selflessness and contribution to society. Consider the ways Edison’s contribution to electricity, Bell’s telephone, Martin Luther King Jr.’s civil rights efforts, and Steve Jobs’ apple technology have bettered civilization on a global level. The legacy of human capital left by these men is irreplaceable.

The process of choosing people who will be allowed to immigrate into the United States is based on quality of human capital, productivity, and the element of family. “There are two ways in which immigrants can contribute to the human capital accumulation in the receiving country: first, they bring with themselves the skills they have acquired before arrival, and, second, after arrival they accumulate human capital differently than natives or they can influence the natives accumulation of knowledge (Dolado pg 194).”

Dolado points out that these non-native citizens bring a unique element to the country, and are therefore valuable because of their influence on native born Americans. According to the Bureau of Labor Statistics, about 40% of PhD scientists working in the U.S. were born off American soil. This fact highlights the importance of immigration for the success and advancement of the American way of life.

Immigrants’ productivity raises the U.S. Gross Domestic Product (GDP) by an estimated $37 billion per year (West). This is a huge number which must be taken seriously. Immigrants have a significant impact on the economy which demands to be noted.

The element of family is another key to immigration to the United States of America. Family values have always been treasured here because success starts in the home. Period. If an American woman marries a Philippino man who is not a citizen, it is easier for him to gain citizenship because a husband and father creates a certain amount of stability and therefore success for his marriage and future children.

In early American history, anyone who could afford to come to the United States was allowed in. There was no real consideration of human capital prior to citizenship around this time.  However, this philosophy changed over several decades. Race and ethnicity became the larger issue.

“The McCarran-Walter Act establishes the basic laws of U.S. citizenship and immigration. This act, also known as the Immigration and Nationality Act of 1952, has undergone several changes since its adoption. Originally, the law admitted only a certain number of immigrants of each nationality. But a law passed by Congress in 1965 gave preference to immigrants with skills needed in the United States and to close relatives of U.S. citizens. A 1990 law continued these preferences. (Braziel)”

The United States began to disallow citizenship from those nationalities they considered suspicious.  This discrimination began with the freed blacks in America and continued with Asians, Chinese, and Japanese people. The human capital of these minorities did not outweigh the perceived danger or destruction these people might bring to the United States.

Other examples of selective immigration in history can be found during WWII. When the Nazis persecuted the Jews, they became refugees looking for countries to take them in. Americans readily accepted the brightest scientists, artists and others who could academically or culturally enhance the United States. However, they were not interested or accepting of “ordinary” people. A cinematic example is found in the movie Deep Impact (2012). The movie tells a tale of a catastrophic disaster and how the world prepared for it and specifically how it affected the life of the protagonist and those he cared about. The government builds bunkers to protect the people with the greatest value and those who were younger in age to preserve the human race. This shows how increased human capital creates a demand for that individual.

Human capital is a focal point of university screenings for admission. The United States of America is the top destination for foreign students to study. American universities want foreign students in their schools because it makes them internationally competitive and better shapes them to function successfully in a globalized world thereby increasing domestic American student’s human capital (McClatchy). According to Princeton University statistics, 11.3% of their student populations are children of Princeton alumni. This figure points to the fact that universities value the human capital of their graduates and want to draw from that for their future students.

 The military brings large amounts of human capital to the individual who invests his or her time serving their country. This includes a powerful combination of purpose, work ethic, leadership, and an unmistakable drive to succeed. All of these qualities are often recognized by employers and valued above the average citizen (http://www.lucasgroup.com). American employers may favor American applicants over immigrant applicants because they value the comradery they have with a fellow American and it will take time to build up trust and connections for the immigrants.

“Metropolitan areas are home to many immigrants who were educated and gained their experience abroad in medical professions, engineering, information technology, and other careers who could contribute to local economies. However, immigrants who acquired their education outside the United States often have difficulties finding jobs in their field of specialization in the first several years after arrival.”

 (Singer pg 4)

The above quote illustrates how culture can affect the worth of the human capital. In the case above an immigrant may be as educationally qualified as an American however it may be difficult for the employer to detect this.

             

            Everyone has a human capital and only they can truly determine how great the value is. The acceptance granted by the immigration department, universities and employers is a narrow path guarded by a demand for “…education, intelligence, charisma, creativity, work experience, and entrepreneurial vigor (Wheelan pg 127).” There is great diversity in the concept of human capital philosophies which have been influenced by charismatic leaders and thinkers of the past. Compared to its global competitors the United States of America has become a leader in the production and implementation of human capital. Finally, what must be considered is how Americans can continue to contribute to the national as well as global human capital without becoming strictly consumers.

Works Cited

"Beyond GDP." The Economist. The Economist Newspaper, 20 Sept. 2010. Web. 08 Apr. 2013.

Braziel, Jana Evans. "History of Migration and Immigration Laws in the United States." History of Migration and Immigration Laws in the United States. N.p., Mar.-Apr. 2000. Web. 19 Apr. 2013.

Dolado, Juan. "Immigration, Human Capital and Growth in the Host Country." Journal of Population Economics 7.2 (1994): 194. Springer Link. Springer-Verlag, June 1994. Web. 10 Apr. 2013.

"Military Transition." Lucas Group, 2012. Web. 19 Apr. 2013.

Newspapers, McClatchy. "US Universities Take Steps to Attract International Students." The Guardian. Guardian News and Media, 17 Nov. 2008. Web. 19 Apr. 2013.

Singer, Audrey. "Investing in the Human Capital of Immigrants, Strengthening Regional Economies." The Brookings Institution. N.p., Sept. 2012. Web. 17 Apr. 2013.

West, Darrell M. "Creating a "Brain Gain" for U.S. Employers: The Role of Immigration." The Brookings Institution. N.p., Jan. 2011. Web. 20 Apr. 2013.

Wheelan, Charles J. Naked Economics: Undressing the Dismal Science. New York: Norton, 2002. Print.