Measuring Human Capital The Why Wayne Smith Chief

Measuring Human Capital: The Why Wayne Smith Chief Statistician of Canada 1

Objective of Presentation § To summarize the main areas in which measures of human capital have been suggested to contribute to policy discussions and improvements in existing statistical products. 2

Main Uses § § 3 Economic Growth Wealth Accounts Enhancing or extending the National Accounts Complementing measures of educational outputs.

Economic Growth § Productivity Accounts are produced by Statistical Agencies to facilitate understanding of the competitiveness of national economies. § A key component of productivity accounts are capital inputs—both physical and human capital. § Measuring the inputs derived from human capital is generally done imperfectly. § Is more direct measurement worth while? 4

Extending the Wealth Accounts § Wealth Accounts are produced to permit discussions of income potential. § Wealth Accounts are more complete with measures of the earnings potential that is derived from Human Capital § What are the Insights provided? 5

Insights from Extending the Wealth Accounts § Sustainability § The manner in which a society prepares for an aging population 6

Enhancing the National Accounts § Helping to improve measures of volume in nonmarket sectors like education. § Understanding the output of the health sector 7

Extending the National Accounts § Extending boundaries 8

Complementing Education Statistics § A summary statistic that complements more detailed data on number of students and types of degrees. § A statistic that along with data on investments made in education can be used to examine rates of return from this form of investment 9

Diversity of Uses 1) Provide key products 2) Facilitate innovation and experimentation a) Wealth accounts b) Measures of sustainability c) Improvements in volume estimates in education 10

A Question of Priorities 1) Do you see the areas outlined by the background papers as ones where new products are being demanded by users? 2) Do you feel estimates of human capital provide useful information? 3) How should statistical agencies organize their experiments with innovative products? 11