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Human Capital Crisis in the Midst of Digital Transformation: What can IT Companies do About it?

What is the human capital crisis? In this article, we tell you what we are doing at Abstracta to reduce the digital divide and try to stop the human capital crisis in the context of digital transformation.

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The concept of human capital refers to people’s productive capabilities, level of education, experiences, general knowledge, skills, and abilities, focusing on their value for economic development.

According to the World Bank (WB), gains in human capital such as the knowledge, skills, and health that people need to realize their potential have been reversed due to the pandemic, with potentially serious consequences for their future prosperity. 

“We have an opportunity to leverage innovative uses of data and technology to improve service delivery on a large scale, reach marginalized populations more easily, and increase the efficiency of human capital spending,” the WB released. “Technology alone is not a sufficient solution to improve service delivery. It must be combined with increased and more equitable access to services, especially for marginalized populations, as well as people-centered designs to ensure efficiency.” 

The report asserts that faster adoption of digital solutions can radically change the way services that protect human capital are delivered.

Recently, Capgemini and LinkedIn published a joint study for which they surveyed more than 1250 people from different positions and professions. It revealed: Every second organization we surveyed acknowledged that the digital gap is widening. Moreover, over half (54%) of the organizations agreed that the digital talent gap is hampering their digital transformation programs and that their organization has lost competitive advantage because of a shortage of digital talent.”

The outbreak of the pandemic has sent shockwaves through the job market, with more and more people working for different parts of the world. At the same time, however, the digital divide has since become larger and larger, which directly impacts human capital.

As announced at the World Bank’s “The Digital Revolution: Promoting Inclusive and Resilient Development” event, more than half of the developing world lacks access to a digital connection, with prevalence in rural areas.

“The COVID-19 pandemic caused advanced and developing economies to take very different paths: the former are expected to fully recover by 2023 and the latter are expected to continue to lag behind in the years to come. However, developing economies have adopted innovative digital solutions that enable economic transformation and put them on the path to green, resilient, and inclusive growth,” WB revealed. 

“Private and public investment in digital solutions is enabling the delivery of essential services to the poorest, creating jobs, strengthening small and medium-sized enterprises, facilitating trade and services, and building resilience to shocks.” 

What can IT Companies do to Help Stem the Human Capital Crisis? 

Bridging the existing digital divide is undoubtedly very important for the digital transformation to be global and not just for the most developed places. 

Unfortunately, there is nothing we can do to increase Internet connectivity globally. But we can collaborate from other angles to reduce the digital divide as part of the digital transformation. Access to digital work and vocational training for people without resources are fundamental links to curbing the human capital crisis.

Abstracta’s Initiatives That go in This Direction

ReconverTIte: Mujeres en TestingupCampabstracta academy

✔️ Our ReconverTite program trains women living in the interior of Uruguay in testing and provides them with new job opportunities. It is a project that fills us with pride, which seeks to increase employment and reduce the digital gender gap in technology at the same time. 

In turn, accompanies Abstracta Academy graduates who need it, mostly women and/or migrants, in their labor market insertion.

✔️Reconversion of refugees and migrants to the IT industry, in favor of a more egalitarian society. A group of 35 migrants or refugees living in Canelones, Uruguay, had access to the Software Tester course at Abstracta Academy for free, in order to achieve their labor reconversion to the IT industry. 

✔️UpCamp is a new spinoff of Abstracta that seeks to democratize the access of skilled people to the IT industry. While these are knowledgeable people, experience is undoubtedly a valuable part of their human capital. And through this initiative, we managed to mitigate the problem that a lack of experience usually implies.

✔️In 2022 launched #ScrumFEM, to empower women in the interior of Uruguay and promote their development. Scrum FEM provides free access to the international Scrum Master course and certification to 10 people who identify with the female gender, with a focus on those unemployed and without resources.

✔️We offer testing courses at Abstracta Academy. In 2021, we provided more than 450 free trainings, and we plan to increase this percentage by more than 20% in 2022. We generate alliances with leading social actors. To bring these opportunities to different groups that do not have access to them.

What are you doing in your company to help reduce the digital divide and the human capital crisis? We would love to hear about your experience and network for future joint projects.

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