By Strategyandbusiness.net
The McKinsey Global Institute used big data to examine 4 million actual employment histories of workers from the United States, Germany, the United Kingdom, and India and found that meaningful work experience is critical to developing human capital.
In this way, effective organizations that prioritize learning and development are identified It can have a greater impact Whether the individual reaches his potential or not.
Human capital is often studied in the context of how to translate investments in early childhood development, education, and health care into a more productive workforce. But human capital is, ultimately, the potential within each individual,” adds a report from the World Economic Forum.
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Based on this, the study by the McKinsey Global Institute notes that:
Work experience is a more important driver of income for workers with less education. People cannot control factors such as their family’s upbringing or the quality of their local schools, but they can exercise a degree of choice in the professions they pursue and the organizations they join, and these choices are especially important for people who start out in them. Low paying jobs.
Work experience contributes between 40% and 43% of average lifetime earnings in the US, Germany and the UK, but 58% in India, where there are fewer people with a higher education. Generally, people without a college degree who start out in lower paying jobs rely more on work experience.
Role reversal can be helpful, especially when people make bold moves. In the McKinsey Global Institute sample, nearly a third of workers in the United States, Germany and the United Kingdom, and nearly a quarter of workers in India, are on track to raise one or more fifths in estimated earnings over their lifetime. since the beginning of his career. Skills derived from experience account for 60% to 80% of lifetime income for those who move up, but only 35% to 55% for those who stay the same or fall back.
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People benefit from early experience in effective organizations. Employers that do well on metrics related to organizational health, training, and internal promotion seem to move people forward. Their employees were more inclined to pursue upward mobility. By controlling for differences in occupation, the time a person spends early in their career in an organization that prioritizes learning and development is one of the most influential factors in determining a person’s future prospects.
For companies, the data raises caution: 80% of job changes involve switching to new employers. This indicates a great missed opportunity. Workers understand the value of learning and development, and feel increasingly empowered to turn to companies that provide them with opportunities to learn new skills and advance. Companies, many of which are facing increasing attrition and staff shortages, will have to respond.
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