THE ECONOMIC ROLE OF EDUCATION IN THE FORMATION AND REPRODUCTION OF HUMAN CAPITAL IN THE CONDITIONS OF ECONOMIC TRANSFORMATION AND LABOR MARKET CHALLENGES

Abstract

Introduction. Contemporary socio-economic changes, driven by the consequences of war, the deepening of globalization processes, and digitalization, significantly affect the structure of the economy, the labor market, and the requirements for workers’ professional competencies. In this context, the role of human capital as a key factor of economic development, innovative capacity, and national competitiveness is increasing. Education becomes particularly important as a fundamental instrument for the formation, reproduction, and qualitative development of human capital, which determines the economy’s ability to ensure sustainable development under current challenges.

Purpose. The purpose of the study is to theoretically justify the economic role of education in the formation and reproduction of human capital in the context of economic transformation and labor market changes.

Materials and methods. The research materials include statistical data on the volume of education expenditures from the consolidated and state budgets; data from international Human Development Index ratings; data from the State Statistics Service of Ukraine on the share of the labor force in Ukraine with higher education; works of domestic authors conducting their scientific research in the field of education and human capital.

The research methods cover a set of theoretical approaches, including analysis and synthesis, comparative analysis, statistical method, graphical method, logical generalization.

Results. The role of education as a system-forming factor in the formation and reproduction of human capital under contemporary socio-economic changes has been substantiated, with emphasis on its impact on labour productivity and the quality of economic growth. An interrelationship between the level of education financing, the quality of human capital, and a country’s position in international Human Development Index rankings has been established based on a comparative analysis of Ukraine and EU countries.. Key structural disparities between the higher education system and the labour market needs in Ukraine have been identified. A generalized set of public policy instruments aimed at addressing mismatches between education and the labour market and enhancing the efficiency of human capital reproduction has been proposed.

Discussion. Further research should focus on the development of models for adapting human capital to the conditions of digitalization and the post-war recovery of Ukraine’s economy. It is also proposed to focus on the study of the formation and reproduction of human capital through its other key components: health capital, cultural capital, talent, experience, motivation, mobility, etc.