Analysis of human capital development in Puerto Rico: summary and conclusion

How is Puerto Rico retraining its workforce to meet the demand of global competition?

Human Capital Development

Deming (1982) in Out of the Crisis said:
The wealth of a nation depends on its people, management, and government, more than its natural resources

Adam Smith (1776) in Wealth of Nation said:

The wealth of a nation depends on its people

Human Capital Development

Human capital describes the education, skill levels and problem-solving abilities that enable an individual to be a productive worker in the global economy Failure to develop human capital can lead to high levels of poverty, unemployment, illiteracy and other social ills

Human Capital Development Problem

Demographic shifts will cause labour shortage by :
The retirements of the baby boom generation A younger workers who may lack adequate education and experience to replace baby boomers

Human Capital Development Solving Problem

Many develop country that lack of natural resources emphasis on their workforce
Example : Japan
In 1950, the country had a reputation for inferior and cheap goods but now, the countrys products are synonymous with quality and Japanese economy is one of the largest in the world (Deming 1982)

Example : Singapore
Singapores success is often attributed to a strong emphasis on developing and investing in its human capital (McLean 2004)

Human Capital Development Solving Problem

The well-being of nations depends on the knowledge and skills of its people. Maintaining national and organizational wellbeing continually depends on human capital development. However, successfully developing human capital presents challenges to all nations, particularly Caribbean countries such as Puerto Rico

Puerto Ricos economic and workforce history

One of the worlds most developed Latin societies Transform from an agricultural to an industrial and now a knowledge-based society. Three aspects contributing to Puerto Ricos development
Plans Policies Organizations.

Puerto Rico 2025

A comprehensive long-term vision and strategic plan.

Puerto Rico 2025 - Plan

Puerto Rico 2025 addresses all aspects of economic, social, environmental and infrastructure development. Strategic goals with an emphasis on
innovation and enterprise human capital productivity job creation small business development and support greater government agility

Puerto Rico 2025 - Plan

Economic Plan 2006 emphasis on:
Advancing infrastructure Creating a centre of excellence in biotechnology, engineering and computing Promoting local enterprise Transforming the tourism industry Reducing dependence on petroleum Transforming government operations.

Puerto Rico 2025 - Policies

Offer an aggressive tax incentives to foreign investors 100% exemption on pioneer industries Education Investment
Developed ViTec, the University of Puerto Ricos incubator programme Industry University Research Consortium (INDUNIV), a joint private and public consortium with a mission to award research grants

Puerto Rico 2025 - Policies

Education Investment
invested 9.6% of its GDP in the University of Puerto Rico system and placed emphasis on science and technology

Puerto Rico 2025 - Policies

Developing human capital
Government-sponsored employment training.
These programmes oer wage subsidies or reimbursements of up to 100%.
As an example, the department of education oers a High Skills Programme that provides specialized training to intermediate management, supervisors, instructors and technical workers. Puerto Ricos citizens have access to on-the-job training, vocational education, apprenticeships and customized training

Puerto Rico 2025 - Organizations

Puerto Rico Industrial Development Company (PRIDCO)
A government-owned organization, promotes Puerto Rico as an ideal investment location for industrial development. Emphasis is placed on promoting high technology industries among sectors such as the life sciences, renewable energy, technology, computing and services. It oers services for corporations including developing business strategies and providing industrial buildings.

Puerto Rico 2025 - Organizations

Puerto Rico Technoeconomic Corridor, Inc. (PRTEC)
A conglomerate of public and private entities with common economic and social interests, united to facilitate and enable Puerto Ricos economic development. PRTEC focuses on the commercialization of new and innovative technologies. The goals of this organization include promoting Puerto Rico as a centre of high-tech excellence and improving the quality of life for citizens by attracting new businesses, job creation and retention and supporting entrepreneurism

Human Capital Development (Puerto Rico) Challenges and Obstacles

Globalization creates new competitors. Reduce in competitive advantage such as manufacturing and pharmaceuticals. Social problems such as illiteracy, inadequate K-12 education, skills migration and government dependency purportedly increase

Human Capital Development

Puerto Rico 2025
Reskilling Efforts

HCD - (Puerto Rico 2025) Reskilling Efforts

Barriers
High cost of energy The bureaucratic process Lack of accessibility to people who need reskilling Trouble in maintaining a skilled workforce And adherence to certain US regulations.
As a US territory, Puerto Rico cannot act on its own in certain areas.

HCD - (Puerto Rico 2025) Reskilling Efforts

Enablers
Interesting Tax Incentive attract a highly skilled workforce and a quality higher education system. The entrepreneurship focus at the community level, reduction of government jobs and sharing of employees across private companies. By entrepreneurship helps citizens realize their creative potential

HCD - (Puerto Rico 2025) Reskilling Efforts

Initiative
In private sector they emphasising on R&D. Within the manufacturing industry, eorts to reskill the workforce have been in the areas of Total Quality Management (TQM), process management, Six Sigma and Lean

HCD - (Puerto Rico 2025) Reskilling Efforts

Initiative
In the Government level, they introduce Workforce Investment Act (WIA)
WIA aims to induce displaced employees into entrepreneurships. WIA partnered with the Department of Labor (DOL) and SHRM to develop mentorship modules such as interviewing skills and business acumen. Government hosts workshops for people on how to setup a small business. These workshops support the governments emphasis on entrepreneurship.

HCD - (Puerto Rico 2025) Reskilling Efforts

Initiative measurement :
WIA is not working very well because fail to fulfil existing workforce needs Not enough initiatives in place to reskill the manufacturing workforce Fail to measure the effectiveness of the program even after getting Phillips ROI certication Lack of any long-term systematic partnerships for developing the biotechnology and aerospace portions of the workforce.

Human Capital Development Puerto Rico - Finding

Puerto Rico are often challenged by economic and social issues compounded by high migration rates of skilled workers. Barriers to Puerto Ricos reskilling eorts include an inadequate K-12 public education system, government bureaucracy, inadequate needs assessment and analysis for training initiatives and lack of collaboration between government and businesses to address workforce needs.

Human Capital Development Puerto Rico - Finding

A number of enablers for Puerto Rico to reskill its workforce. The island possesses a highly skilled and experienced workforce, quality higher education and appealing tax incentives to attract businesses. Studies show the probability of biotechnology and aerospace technology absorbing the number of individuals trained for such jobs are very low. These eorts could result in an unnecessarily high number of people prepared for jobs that may not exist

Human Capital Development Puerto Rico - Recommendations

Need to conduct proper needs assessments. Otherwise, Puerto Rico will train individuals for jobs that do not exist and will never exist Needs to encourage a spirit of collaboration and cooperation. There appears to be a need for systematic coordination of programmes among the private and public sectors

Human Capital Development Puerto Rico - Recommendations

Shared partnership between educational institutions, government, community agencies and the private sector to develop policies and programmes that will benet both the employee and the organizations for which they work Implement a system for measurement and evaluation such as Phillips ROI Methodology to quantify the eectiveness of training programmes

Thank you!