The Nexus between Human Capital Investment and Firm Growth of Selected Non-Financial Firms in Nigeria

Abstract

The purpose of this study is to examine the nexus between human capital investment and firm growth of selected ICT and services firms in Nigeria. Based on judgemental sampling, secondary data were employed. Panel data regression model was used to examine Return on Assets (ROA), Human Capital Efficiency (HCE), Employee Growth (EG) and Staff Cost (SC)on firm growth. The findings show that there is a negative and significant relationship between human capital efficiency and firm growth. It also, reveals a positive and significant relationship between employee growth and firm growth. There is, however, a negative and insignificant relationship between return on asset, staff cost and firm growth. The findings should be helpful to board members, managers, investors and regulators. The study recommends that selected non-financial firms should invest on human capital efficiency and employee growth through strategic training and retraining to enhance, initiate and sustain firm growth. To ensure adequate return on human capital investment, ICT and services firms should bond their staff to curtail rapid turnover of highly skilled staff.