The UK’s human capital – the economic value of the knowledge and skills of the UK’s working age population – fell by £130 billion in 2010, new estimates published today by the Office for National Statistics show. The knowledge and skills of workers in the UK were worth an estimated £17.12 trillion in 2010. This was more than two-and-a-half times the estimated value of UK's tangible assets – such as buildings, vehicles, plant and machinery – at the beginning of 2010.
ONS is publishing these estimates of human capital as part of its measuring national well-being programme. There is increasing international awareness that national well-being depends upon human capital as well as natural, social and physical capital. The ONS article discusses the concept of human capital and its importance to a number of policy debates in the UK as well as measuring national well-being. It uses data from the Labour Force Survey to value the human capital of the UK’s working-age population between 2001 and 2010.
The value of the UK's human capital stock increased steadily between 2001 and 2007, averaging annual increases of £425 billion. The slowing of earnings growth and increases in unemployment during the economic downturn meant that growth in the stock of human capital slowed to an average of £120 billion per year between 2007 and 2009, before falling in 2010.
The article also looks at the distribution of human capital showing that in 2010, less time in paid employment over their lifetime and lower average labour market earnings means that the total market value of women’s human capital (£6.64 trillion) was around 63 per cent of men’s (£10.48 trillion).
Human capital was also disproportionately concentrated in those workers with the highest educational attainments. In 2010, 36 per cent of the human capital stock was embodied in the 23 per cent of the working age population whose highest educational attainment was a degree or equivalent. In contrast only 5 per cent of the human capital stock was embodied in the 23 per cent of the working age population who had no formal qualifications.
The statistics quoted are experimental statistics. Experimental statistics are new official statistics undergoing evaluation. They are published in order to involve users and stakeholders in their development and as a means to build in quality at an early stage. They are produced free from any political interference. © Crown copyright 2011.
Next publication: 14 December 2012 (provisional)
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