On the conditions of capitalizing the employee’s labor potential

The work is devoted to identifying the conditions for transforming the employee’s labor potential into human capital. The authors rely on the basic definition of human capital as an additional source of income provided by the employee’s knowledge, skills and motivation, and associate it with the payback of expenses on developing his abilities and the abilities of his children. It is shown that the employee’s labor potential is not always his or her capital, but becomes it only under the condition of expanded reproduction of the employee’s household. It is substantiated that income from employment of a highly and semi-skilled worker in a household with one or two workers and with one or two children should ensure the capitalization of labor potential. It is revealed and confirmed by quantitative calculations that the wages of a significant portion of highly qualified and medium-qualified employees with minor children do not actually allow for expanded reproduction of the purchasing power of households in terms of per capita monetary income and, therefore, do not ensure the capitalization of their labor potential. The reasons are identified and directions are proposed that will lead to the expansion of capitalization of the labor potential of workers in households with children.

labor potential, human potential, human capital, household of a worker/an employee with children, professional qualification groups, highly qualified and mediumqualified employees, higher and secondary vocational education, purchasing power of a worker by wages, purchasing power of a household by per capita income, expanded reproduction of the standard of living of a household