Human Capital and Diverse Hiring

Celeste Leuschel

Human Capital and Diverse Hiring

Human capital concept in tag cloud

Human capital concept in tag cloud on white background

Two people applying for the same job have earned the same degree at the same college. The only difference between the two is that one is a convicted felon and the other is not. Therefore, the felon is seen as less valuable, and the other is hired even though their skill set is the same. One applicant is seen as a “risky hire,” which makes them appear less valuable to employers. Human capital is determined by the skills and privileges a person has, and a felony conviction makes an applicant for a job much less desirable than a person without a criminal record.

“Human capital is critical for a company’s success; a company is only as good as its people.”1 Even if the convicted felon is extremely bright, skilled, and educated, they committed an act that makes them look bad, meaning if they are hired they could possibly make the company look bad, depending on what their offense is. Employers want to hire the best, most skilled employees in order to produce as much as they can. Keeping that in mind, employers often want to hire an applicant with experience in the field, such as completing an internship or working a previous job in the field, to prove that they have knowledge and are competent in their field. People who have completed internships have more experience, therefore they are worth more in human capital. Determining one’s human capital often relies on privilege, however, human capital for the sake of a country or company can be different. For example, a recent study from McKinsey and Co. Inc. has shown that ethnically diverse work forces perform 35% better than non-diverse businesses, despite racial profiling being an issue in hiring for many companies.1 In fact, hiring diversely actually contributes to America’s human capital as a whole. “Women went from holding 37 percent of all jobs to 47 percent over the past 40 year, which has accounted for about a quarter of current GDP.” Also, diversely hiring will help the work force will adapt with the change in racial diversity in America; by 2050, there “will be no racial or ethnic majority in the country.”2 Finally, diversity leads to creativity, which leads to more productivity. People who come from different backgrounds will have several different and effective problem solving methods, which increases productivity. Diversity leads to increase in productivity in the short and long term, and improves the human capital of a company and a country.

Human capital does not always have to apply to a single employee, a company could have a highly skilled work force, meaning the company is high in human capital. Regardless of the skill, or lack thereof, of one employee, a company having high human capital is not mutually exclusive with a single, lesser skilled worker, meaning a high skilled workforce is often sufficient enough for a company to still be perceived as high in human capital. Also, by hiring a diverse work force, a company’s human capital will grow tremendously each year. Taking human capital into consideration is key for a successful company.


Works Cited

“Human Capital Definition | Investopedia.” Investopedia. N.p., 10 June 2004. Web. 22 June 2016.

Kerby, Sophia, and Crosby Burns. “A Diverse Workforce Is Integral to a Strong Economy.” American Progress. N.p., 12 July 2012. Web.


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