International Journal of Research and Scientific Innovation (IJRSI) | Volume VI, Issue XII, December 2019 | ISSN 2321–2705

Factors Affecting Human Capital Development in Malaysia

G Gunasegaran Gopal

 Ghazali Shafie Graduate School of Government, Universiti Utara Malaysia

Abstract – This conceptual paper describes the factor that affects human capital development in Malaysia. Human capital development in Malaysia is not par with other Asian countries such as Singapore, Japan as well as South Korea. Among the factors that affect human capital development in Malaysia are lack of proficiency in English language, issues with Technical and Vocational Education and Training (TVET), Malaysia’s higher education institutions’ ranking, brain drain issues among Malaysians as well as ad hoc policies implemented in Malaysian education systems.

Keywords – human capital development, Technical and Vocational Education and Training (TVET), brain drain

I. INTRODUCTION

According to Goldin (2014), human capital refers to the skills the labour force owns and it is considered as an asset. It includes the investments in people especially in improving their education, training and health. These investments are believed to increase an individual’s productivity. Human capital is the basic input of innovation (OECD, 2010). Human capital development in Malaysia is unsatisfactory compared to its counterparts Singapore, Japan and Korea. Malaysian labour force is considered as lacking in terms of talents, skills, English proficiency, and so on. This article analysed the factors that affect human capital development in Malaysia.

II. FACTORS AFFECTING THE HUMAN CAPITAL DEVELOPMENT IN MALAYSIA

Rosyati Abdul Rashid and Rosna Awang Hashim (2008) claimed that in this information technology era, the demand for knowledgeable workers and smarter graduates are increasing. As a result, many countries in the world invest in education to produce better human capital than other countries. The author also reported that English language proficiency is considered as one of the important criteria in producing marketable human capital. The author further ascertain that previous studies conducted by researchers such as Morshidi Sirat et al (2004), Ambigapathy Pandian & Aniswal Abdul Ghani (2005) indicated the importance of communication skills in English as one of the criteria for competent graduates.