More than half of all children born this year will lose half of their potential lifetime earnings due to poverty, poor health and a lack of education, according to the World Bank’s Human Capital Index, according to Reuters.com.
The global institution defined human capital as a person’s knowledge, wellbeing, and skills accumulated over a lifetime.
The institution noted that the development of human capital was key to reducing poverty and boosting economic growth throughout the 20th century, especially in countries in East Asia.
Yet many governments are neglecting human capital, which will be “critical” to succeed in the economy of the future, according to the report.
The authors noted that investing in human capital makes people more productive, flexible and innovative - skills that have become increasingly important as workplaces evolved in response to rapid technological change.
By analyzing indicators such as child mortality, education rates, and health, the World Bank report found that 56 percent of children born around the world this year will reach only half their earning potential.
The survey ranked 157 countries according to how productive their next generation of workers is likely to be.
Chad, South Sudan, and Niger were at the bottom of the list, while Singapore, South Korea, and Japan came at the top.
Countries that scored 0.5 out of 1 on the index - meaning they are losing half of their future economic potential - were estimated to lose 1.4 percent in annual economic growth over 50 years, the report said.
In contrast, if children born in countries like Azerbaijan, Ecuador, and Thailand - which all scored 0.6 - were to receive full quality education and healthcare, they would be 40 percent more productive by the time they entered the workforce.