Question

Jack has worked for Widgets, Inc. for 35 years, and he is the only employee who can decipher the old coding on products in the warehouse before computerization took place. Due to the economic downturn, Jack was forced into early retirement. What type of knowledge will Widgets lose?

Answer 1

Answer: Human capital

Explanation:

Human capital is the stock of habits, knowledge, social and personality attributes (including creativity) embodied in the ability to perform labour so as to produce economic value. Human capital is unique and differs from any other capital. It is needed for companies to achieve goals, develop and remain innovative. Companies can invest in human capital for example through education and training enabling improved levels of quality and production . Human capital is an intangible asset or quality not listed on a company's balance sheet. It can be classified as the economic value of a worker's experience and skills. This includes assets like education, training, intelligence, skills, health, and other things employers value such as loyalty and punctuality.

The concept of human capital recognizes that not all labor is equal. But employers can improve the quality of that capital by investing in employees the education, experience, and abilities of employees all have economic value for employers and for the economy as a whole . In the case for Jack , 35 years of experience is very valuable human capital and also Jack’s skill are very scarce in general , so the company is losing .