Which type of investment is known as human investment
Answers
Answer:
Explanation:
Human Capital
A human capital investment definition helps you understand the importance of investing time and money into education and training opportunities. In business accounting terms, capital refers to the primary goods or borrowed funds that are used to start or operate a business. Capital goods represent a major investment, typically in things like equipment, vehicles or a building, whereas capital debt represents borrowed funds like a business loan or credit card debt.
Businesses also invest in human capital, through the hiring of a workforce to produce goods and manage operations. The true asset, however, is the quality of the skills and knowledge held by those employees and how they utilize them for the benefit of the company where they work. Additionally, qualities such as good work habits, punctuality and overall health are important factors in the human capital component.
Human Capital and Economic Growth
There is an increasing awareness among business owners that paying for their employee's education is an investment in human capital. For some, this may mean offering tuition reimbursement for business related courses at a local college. Companies may also sponsor seminars; training classes focused on developing specific technical skills; or even workshops on developing people skills such as problem solving or managing conflict. Overall, these programs work to improve the quality of work among employees, and also have been shown to increase productivity. When employees feel that their company is interested in helping them develop professionally, they are happier in their jobs and, in turn, become more productive.
Educational investment in employees also creates loyalty to the company. When a lower level staffer is provided with a clear path of professional development and can see herself having the ability to rise to a management position, she is more likely to invest herself in the company and work hard to achieve both personal and professional goals.
Protecting Your Company's Assets
Be careful, however, to protect the investment you have made in your employees. If you spend money on extensive training programs only to have your workers leave for more lucrative positions elsewhere, you are losing more than human capital; you're losing the monetary investment you have made, as well. Ideally, the investment you've made in your staff will pay for itself in happier, more productive workers who are engaged in your company and content with its positive environment and corporate culture. However, particularly in highly competitive industries, a company may choose to put contractual arrangements into affect, requiring a specific term of employment in exchange for the training or skill advancement they provide. Others may require a non compete clause in the employment contract to prevent employees from accepting employment with their competition.
Investment for the Individual
Although much of the talk concerning human capital focuses on how a company's provision of education is an investment in human capital, individuals are the true owners of human capital. Every employee nurtures and maintains his own knowledge, set of skills, and abilities to perform and produce. Whether an employee or an entrepreneur, all individuals are in charge of their own personal growth and professional development. If your employer does not provide training, seek out avenues for growth and development on your own. Seminars, networking groups and online courses are all ways to develop yourself. And, ultimately, if you are employed in a dead-end position with no promise of continued advancement or potential to expand your set of skills and professional experience, perhaps it is time to consider a new position.
Agricultural investment
Explanation: