Are you looking to give yourself a short-term boost during tight economic times? Are you considering taking on freelancers but unsure of how to manage them on an ongoing basis? Or do you find yourself wondering why you’re still the only one in your office during the day?
If so, you need to invest in human capital. You need to invest in your workforce and make sure that you’re putting the right mechanisms in place to foster not only human capital but talent and growth.
So what exactly is the difference between human capital vs human resource? Continue reading!
What Is Human Capital
Human capital is everything that allows people to be productive in their jobs. And it is the most important asset that any organization has.
Organizations invest in human capital just as they invest in other kinds of capital, such as financial capital, plant and equipment, and technological capital. The goal is to increase the productivity of the workforce so that the organization can achieve its goals.
Human capital is important because it is the source of an organization’s competitive advantage. It is the one thing that an organization has that its competitors do not have.
Thus, human capital is a key determinant of an organization’s success or failure. Investing in human capital is essential if an organization is to prosper in the long term.
What Is Human Resources
The term “human resources” refers to the staff of an organization. It is also the department within said organization that is responsible for managing said staff.
The human resource department is responsible for a variety of tasks. This includes staff and as well as HR training, recruiting, and managing employee benefits. In addition to these more traditional roles, the human resource department is also often responsible for managing employee relations and ensuring compliance with labor laws.
How Human Capital and Human Resources Differ
While the two terms are often used interchangeably, there is a big difference between human capital vs human resource.
Human capital is the investment that an individual makes in themselves. This includes things like getting an education, gaining work experience, and developing skills. The goal of human capital is to make the individual more productive and able to contribute to the economy.
Human resources, on the other hand, are the people who make up the workforce. This includes both the skilled and unskilled labor force. Human resources are what an organization uses to get work done.
The difference between human capital and human resources is that human capital is an investment in an individual, while human resources are the people who make up the workforce.
Human Capital vs Human Resource
The most important resource any company has is its people. Investing in human capital through effective human resource management practices pays off in increased productivity, profitability, and employee engagement. Implementing a strategic approach to human resources can help your company attract and retain the best talent and improve your income.
Do you have a strategic approach to human resources? If not, now is the time to develop one.
If this article about human capital vs human resource was interesting to you, consider checking out our other articles today for more relevant information.