HUMAN CAPITAL AS A FACTOR OF INNOVATIVE TRANSFORMATIONS

Abstract

Human capital is a strategic resource that determines how effectively economies generate, absorb, and scale innovations in an era shaped by rapid technological change. This article investigates the central mechanisms through which human capital drives innovation-led transformation, emphasizing the role of advanced skills, research capacity, creativity, and life-long learning. It highlights how education quality, the structure of research systems, and the mobility of talent influence national innovation outcomes. Special attention is given to the findings of the Global Innovation Index 2025, which shows that leading innovation economies consistently combine high R&D investment with strong performance in the Human Capital. Countries such as Switzerland, the United States and Singapore demonstrate that long-term investment in skills, scientific infrastructure, and academic excellence remains the core foundation of their competitive advantage. At the same time, several fast-rising middle-income economies – including China and India – achieve substantial progress by expanding access to higher education, strengthening STEM training, and creating conditions that support technology-oriented entrepreneurship. The study also examines key challenges that constrain the full realization of human capital potential: unequal access to quality education, the mismatch between labor-market needs and educational programs, brain drain, and the slow adaptation of formal institutions to emerging technologies. Addressing these weaknesses requires coordinated policies that integrate education reform, talent retention strategies, university-industry collaboration, and support for continuous reskilling. The analysis concludes that human capital is not merely a complementary factor but the primary driver of innovation systems. Economies that maintain strong and adaptive human capital are better positioned to convert technological opportunities into sustainable growth, resilience, and long-term competitiveness.