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Question
"Expenditure on On-the-job training is an important means of human capital formation in an economy."
Give valid reasons to justify the given statement.
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Solution
Yes, Expenditure on 'On the job training' is an important means of human capital formation in the economy.
Reasons:
- Updation of new skills: There are several skills that employees are inexperienced with. Employee training at work enables individuals to improve their skills. Teachers have found the usage of smart boards and mobile devices, for instance, to be extremely helpful during the time of Covid.
- Increase in productivity: The development of new skills aids in improving an employee's productivity or efficiency. They execute a task in comparably less time than before.
- Increase in expertise: Employees become experts at a task when they accomplish it consistently while utilizing new skills. Additionally, it boosts employees' self-confidence.
- Economic growth: The majority of employees gain new skills and contribute to GDP growth, therefore investing in "on the job training" is helpful for economic growth in addition to the business and the employees.
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