1. Main points

  • In 2020, the UK's full human capital stock, as measured by the projected lifetime earnings of working age people, was worth £23.8 trillion.

  • Annual growth of the UK's total lifetime earnings was 1.2% in 2020, the strongest growth seen since 2011.

  • In 2020, the UK's lifetime earnings per head also grew annually by 1.2% to £566,000.

  • Total lifetime earnings grew in 2020 mainly because of an increase in educational attainment – 1.2 million more people had a PhD, master's or undergraduate degree (or equivalent) as their highest qualification level when compared with 2019.

  • Women's total lifetime earnings increased by 8.6% in 2020 when compared with 2010 (now accounting for £9.2 trillion), while men's total lifetime earnings increased by 6.5% over the same period.

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3. Human capital estimates in the UK data

Human capital estimates: supplementary tables
Dataset | Last updated 25 April 2022
Human capital stock and per head values, equating to lifetime labour earnings, supplementary to human capital stock publications.

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4. Measuring the data

Updates to methodology

Our previous core methodology can be found in our Measuring the UK’s Human Capital Stock methodology guidance (PDF, 208KB). This involved calculating earnings by age, sex and highest qualification level, where highest qualification level was grouped into six levels including "Degree or equivalent". We have now adjusted the core methodology so that "Degree or equivalent" is separated out into "Undergraduate degree or equivalent" and "Master's degree or PhD". This followed on from experimental work in our last release that derived this for the first time. This adjustment allows us to see the lifetime earnings premiums for those with undergraduate degrees and master's/PhD level qualifications separately and will also improve the measurement of our human capital stock value.

We have additionally moved to using the Törnqvist index to more accurately measure how real human capital changes over time. For further recent updates to our methodology, see the Methodology developments section of our Human capital estimates in the UK: 2004 to 2018 article.

Full and employed human capital

Full and employed human capital estimates are provided in this bulletin. Full human capital estimates assume that unemployed people have the same lifetime earnings as those who are employed with the same age, sex, and highest qualification, whether they are currently employed or not. Under employed human capital methodology, those who are unemployed are assumed to have zero human capital. In both full and employed human capital estimates, inactive individuals (those not seeking work) are assumed to have no human capital. We refer to full human capital estimates in this release, unless stated otherwise.

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5. Strengths and limitations

As outlined in our Measuring the UK's Human Capital Stock methodology guidance (PDF, 208KB), there are several assumptions that go into deriving human capital stocks through projected lifetime earnings.

One assumption of the current human capital methodology is that future trends are projected from current-year trends. This could be seen as a limitation in 2020, because of the coronavirus (COVID-19) pandemic's effect on earnings and mortality rates. We therefore adjusted individuals' earnings and the mortality rates that are projected forward so that they better reflected the levels seen before the coronavirus pandemic. These adjusted earnings and mortality rates were used to calculate projected lifetime earnings, which were then compared with the estimates that used the original methodology. This analysis showed little difference between the estimates derived from the original and adjusted methods, and as a result we have not changed the methodology in 2020. Data tables showing this analysis can be found in our supplementary tables.

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