Editorial | Fix productivity by fixing the people

The prestigious medical publication Lancet, in collaboration with the World Bank, recently released the findings of a survey ranking the human capital development of 195 countries for 2016 compared with 1990. This publication has not been heralded by the Jamaican authorities, as it did not show the country improving. It is nevertheless worthy of analysis.

Human capital comprises the aggregate levels of education, training, skills, and health embodied in a population. The quality of this human capital is indicative of national progress and can help determine the rate at which technological innovation can be applied to increase productivity and achieve prosperity.

Given the stagnation of the Jamaican economy and declining productivity, it was not surprising to find that the country, over a quarter of a century, slipped seven places from 81st in 1990 to 88th in 2016. Finland, with its highly rated education and health systems, was ranked number one, and the very poor West African country of Niger at the bottom.

Jamaica has underinvested in its human capital over the last 25 years. The huge debt burden that followed the financial collapse of the 1990s, and the subsequent rescue by FINSAC, forced the country to run annual primary surpluses above 7 per cent of GDP (among the highest in the world) for an extended period to bring the debt to a manageable level. As a result, most non-debt expenditures were reduced in real terms.

Debate on how best to improve human capital matters greatly. The best policies in the world won't guarantee prosperity if the bulk of the citizens are sick, illiterate and/or innumerate.

In the 20th century, universal public-education and public-health measures became standard policies that significantly increased human capital. Factory and office workers could read instructions and calculate revenues and costs, and people throughout society were mostly freed from the scourge of many diseases. Life expectancy and the quality of life increased rapidly.

Twenty-first-century economies have come to depend on knowledge workers using productivity software, interacting with websites, and performing other complex tasks. In this new, interconnected world, workers are being asked to think and use their brainpower constantly.

A major threat to clear-headedness comes from drugs and alcohol. There are strong links between heavy drug and alcohol use and unemployment, as well as underproductivity.

LEAD POLLUTION

A far less discussed problem is lead and environmental pollution. A flood of recent research findings in the US is showing that even small amounts of lead exposure in childhood can lead both to worse academic performance later in life, and to more criminal behaviour.

Furthermore, current evidence suggests that children are exposed to lead far more frequently than most people realise, including in toys, paint, and car batteries. The shambolic way in which Jamaica manages garbage collection and disposal is also eroding the quality of life. This is nothing short of a national shame.

Recent United Nations reports show that air and environmental pollution represents the fourth-biggest source of death across the planet. By allowing people to be poisoned with heavy metals and poor air and environmental conditions, our intelligence, self-control and health are being degraded.

Poverty is another factor preventing people from being able to think clearly and grow up healthy. Thousands of Jamaican children, subject to brain-damaging malnutrition, are likely getting some form of post-traumatic stress disorder from growing up in areas with constant noise from sound systems and high levels of violence and disorder.

These factors represent severe threats to quality of life and human capital development. The good news is that they are all amenable to good policy interventions. Policymakers must, therefore, take more decisive action to beat back this multipronged assault on the underdevelopment of human capital.