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Authors
1 UCHE, JOY DAKORU Ph.D; 2 UCHE, HENRY IDOKO Ph.D
1* IGNATIUS AJURU UNIVERSITY OF EDUCATION
RUMUOLUMENI, PORTHARCOURT
+2348034535270
2 DEPARTMENT OF ACCOUNTANCY
UNIVERSITY OF NIGERIA
ENUGU
+2348051533647
ABSTRACT
The study sought to determine the relationship between human capital costs and financial performance of listed industrial goods manufacturing firms in Nigeria. The theory underpinning this study is Human capital theory. Ex-post facto research design was considered suitable for the study. The population of this study was thirteen (13) industrial goods manufacturing firms listed on Nigeria Exchange Group. Convenience sampling, which is a non-probability sampling technique, was adopted in determining the sample size of seven industrial goods manufacturing firms listed on Nigeria Exchange Group between 2013 and 2022. The specific objectives of the study were to: 1) Determine the relationship between recruitment and hiring costs and net profit margin; 2) Ascertain the relationship between recruitment and hiring costs and return on assets; and, 3) Evaluate the relationship between recruitment and hiring costs and return on equity. The study formulated five research questions and corresponding null hypotheses. It retrieved secondary data from the annual reports of the firms sampled. Human capital theory was the theoretical anchor of the study. The study tested the formulated hypotheses using Feasible Generalized Least Square Regressions. Findings revealed that: 1) Employee training and development cost have no significant effect on the return on equity of listed industrial goods manufacturing firms in Nigeria; 2) Staff welfare cost has a significant relationship with the return on equity of listed industrial goods manufacturing firms in Nigeria; and 3) Recruitment and hiring costs have a significant effect on the return on equity of listed industrial goods manufacturing firms in Nigeria. The study recommended that: 1) Listed industrial goods manufacturing firms in Nigeria should strategically evaluate and invest in staff welfare initiatives that foster a positive work environment and employee satisfaction while also ensuring alignment with financial objectives; 2) Listed industrial goods manufacturing firms in Nigeria should consider the unique implications of their organizational size when strategizing human capital investments; 3) Overall, listed industrial goods manufacturing firms in Nigeria should maintain vigilance on human capital cost using appropriate tools to checkmate cost overrun so as to continue to enhance financial performance.
Keywords: Human Capital, Cost, Financial Performance, Manufacturing Companies, Nigeria.
