Championing education: Investing in human capital

In 2018, the World Bank introduced the Human Capital Index, a pivotal measure of how nations invest in the health, education and skills of their populations. This index underscores a fundamental truth: investing in human capital is essential for sustainable economic growth and societal development.

Human capital comprises the knowledge, skills and health that individuals accumulate throughout their lives. It serves as the bedrock of a productive workforce and is crucial for navigating the challenges posed by a rapidly evolving global economy. Countries that prioritize the development of human capital empower their citizens to excel in diverse career paths and significantly contribute to national progress.

The Philippines received a Human Capital Index score of 0.52 in June’s “The Philippines Human Capital Review,” revealing that a child born in 2020 can achieve only 52 percent of their potential productivity by age 18. While the country performs adequately in terms of expected years of schooling compared to regional peers, challenges persist in ensuring quality education and fostering skills relevant to the modern job market.

Recent international assessments, such as the Program for International Student Assessment, highlighted significant deficiencies in reading, mathematics, science and creative thinking among 15-year-old Filipino students. These findings underscore the urgent need for educational reform and enhancement.

Acknowledging these challenges, the Philippine government has made education a top priority in its budgetary allocations, earmarking P924.7 billion for 2024, representing 16 percent of the total national budget. Legislative initiatives like the Academic Recovery and Accessible Learning Program and the Enterprise-based Education and Training Act aim to bolster learning outcomes, enhance workforce competitiveness through upskilling and reskilling, and expand government support for private education.

Collaboration between government and the private sector is crucial. The SM Group exemplifies this partnership through sustained contributions to education. Over four decades, the SM Foundation has developed and redeveloped over 100 school buildings, over 360 classrooms, and supported over 5,500 scholars, with a focus on underprivileged communities. SM’s acquisition of National University in 2008 has widened access to affordable and quality education across key provinces, with plans to establish 20 additional campuses by 2028.

In anticipation of the advent of artificial intelligence and technological advancements, equipping students with STEM (Science, Technology, Engineering, Mathematics) skills is paramount. SM’s visionary partnership with IBM in 1991 to establish Asia-Pacific College underscores its commitment to fostering innovation and preparing youth for competitive IT careers, ensuring their competitiveness.

Investing in education transcends being merely a government mandate, it is a strategic driver for progress. A concerted effort spanning public and private sectors to champion education is essential to surmount current challenges, drive sustained economic growth, and ultimately pave the way for a brighter future for generations to come.