Investing in Human Capital
Objectives and methodology of research
At present, many changes and constantly increasing demands on human resources occur as a result of new technologies. These dynamic changes perpetually encourage businesses to be more and more interested in the efficiency of investment in their employees. It is therefore important to focus a company's investments in human resources so as to effectively get back the invested capital and to meet the objectives of the company and its visions for the future. The objective of this work is to determine the effectiveness of investments in human resources, using statistical and econometric methods. The analysis focuses on measurable economic indicators such as labour conditions, turnover, productivity, human capital value added (HCVA), human capital return on investment (HCROI) and other measurable indicators. Evolution of the indicators was examined between 2013 and 2015. Nonmeasurable indicators of the contribution of investment in human resources were obtained by questionnaires. The research was done in a woodworking enterprise engaged in the Slovak Republic, which employs less than 250 employees. The aim was to identify similarities and differences in motivation factors for employees that significantly affect the satisfaction, motivation, and performance of the employees, as well as the overall performance and potential development of the company as a whole. We contacted all the employees working in the selected company. A total of 176 questionnaires were distributed. One hundred and forty-eight questionnaires were correctly filled out - which represents a return to the level of 84.09%. Detailed identification of respondents in terms of age, education level, job category, and seniority is presented in Table 2.
| Age | Finished education | Seniority - years of practice | Employment category | ||||
|---|---|---|---|---|---|---|---|
| Under 30 | 35 | Primary school | 12 | Less than 1 year | 9 | Top management | 9 |
| 31–40 | 28 | Secondary school (no school leaving exam) | 56 | 1–3 years | 29 | Middle management | 15 |
| 41–50 | 45 | Secondary school (school leaving exam) | 67 | 4–6 years | 20 | Worker | 124 |
| 51 and more | 40 | University | 13 | 7–9 years | 22 | ||
| 10 years | 68 | ||||||
Table 2. Composition of the research sample.
From the analysis of the respondents, it can be seen that the age structure of the survey sample is diverse. That is a prerequisite of flexibility of human resources in the enterprise. Younger workers can bring new ideas, whereas older employees provide balance and knowledge based on years of experience. Completed education that prevailed among employees was secondary education. When concerning seniority, a group of employees who worked for 10 years or more prevailed. This fact is a sign that the company is able to keep valuable employees and meet their needs. Among all respondents, the greatest number was represented by workers and middle management. However, we were also able to obtain preferences of top management individual work motivation and preferences.