Skill Sets as an Approach to Measuring Human Capital
Brian Gongol


Why Traders and Ranchers Don't Respect One Another
It's hardly novel to note that lots of Wall Street traders and back-country ranchers regard one another with a pretty significant amount of disdain. To the trader, the rancher is an unsophisticated country bumpkin; to the rancher, the trader is "big hat, no cattle".

In their own ways, each is right -- the financier lives in a highly technical world in which basic needs are satisfied without physical labor, while the rancher could probably survive under environmental conditions that would make the trader wither and die.

If the author were asked to supply a list of his own marketable skills, ranging from proficient (where the author might be comparable to competitive individuals) to exceptionally proficient (where the author would consider himself a true expert), it might look something like the following:

Proficient
Sales
Graphic arts
Business
Management
Business/marketing planning
Strategy
Highly Proficient
Marketing
Economics
Broadcasting
Voice work
Public speaking
Rapid information processing
Emergency/urgent management
Exceptionally Proficient
Writing
Internet design
Editing
Rapid research
Original thinking
Organization of information

The table, though, belies a bias in favor of service-economy skills. While they are highly marketable and useful in a stage of economic development where most of the basic human needs are efficiently fulfilled, they would be largely useless were the author to find himself stranded on a desert island.

The Skill Question Influences Our Ability to Understand World Poverty
The same bias applies on a much larger scale, too: Developing nations and the advanced economies barely speak the same language when it comes to questions of development, trade, and interaction. This inability to see eye-to-eye keeps well-meaning (but disturbingly wrong) trade protesters from wealthy countries on the streets in front of WTO meetings when people from those developing nations who know better (like Hernando de Soto and Muhammad Yunus) know that trade is the only long-term hope for the people of poor countries.

Skill Sets from All Categories of Development
What's needed is a better recognition on all parties' accounts that human skill sets apply to several distinct stages or categories of needs. Revisiting the author's skill sets listed above as if all skills mattered, the results might look like the following:

Proficient Highly Proficient Exceptionally Proficient
Survival Skills First aid
Crop agriculture
Sanitation
Self-defense
Mechanical/Industrial Skills Plumbing
Firearms
Emergency/urgent management
Service Economy Skills Sales
Graphic arts
Business
Management
Business/marketing planning
Strategy
Marketing
Economics
Broadcasting
Voice work
Public speaking
Rapid information processing
Writing
Internet design
Editing
Rapid research
Original thinking
Organization of information

It's clear from the above that the author is from an advanced economy. But the non-service-economy skills are no less important as a result. While certain skills really aren't needed on a daily basis in an advanced economy (especially when someone can be paid to do them), society actually needs every individual to have at least some of those skills in reserve -- particularly when natural disasters or human strife occur.

When floods hit the Upper Midwest in 1993, the city of Des Moines lost municipal water service for about two weeks. During that time, a major American city (whose primary industry is insurance) was forced by a natural disaster to step back a full stage of development from being an advanced city to one seeking to fulfill basic sanitation needs that were solved in most American cities a century before.

During that time, it was only due to significant assistance from outside agencies and the remaining lower-order skill sets of the locals that a larger crisis was averted. Similar stories could certainly be told of New York City on September 11, 2001 or of San Francisco during the 1989 Loma Prieta earthquake.

A Broader Understanding of Human Skill Sets is Vital
It would be one of the greatest steps forward for human development if we were to learn to better-categorize human skill sets as they apply to different stages of development. It's not just a case of the trader and the rancher disrespecing one another; it's in fact a case of realizing that without skill sets from every age, even an advanced economy can be brought to its knees -- but also that developing economies need just as much to be understood as places full of skills rather than as helpless paupers.