Effective use of human capital in the context of sustainable development of the region

Introduction. Sustainable development is Russia's strategic goal at the national and regional levels. Currently, its key factor is innovation, which, in turn, is determined by the availability of sufficient amount of human capital, it being a set of knowledge, skills and abilities, including the ability of a person to generate ideas, create innovations, and bring them to production. Although Russia has a fairly large amount of human capital, its economy is experiencing difficulties in shifting to the innovation-driven model. Based on the conducted research, the article evaluates effectiveness of the use of human capital and analyzes the causes of the existing contradiction. Materials and Methods. The theoretical foundations of the study include the works of Russian and foreign academic economists, generalization and critical analysis of which made it possible to show the indirect impact of human capital on sustainable development. Based on data from the Russian Federal State Statistics Service, its territorial offices and the Analytical Center under the Government of the Russian Federation, the efficiency of the use of human capital by Russian regions was calculated employing the index method and it was compared with the level of the socio-economic development. Results. The level of innovation activity in Russia’s regions remains low. Innovation has not become a driving force for sustainable development. One of the reasons for this is low effectiveness of the use of human capital. Calculations of this indicator, carried out according to the adopted methodology, make it possible to conclude that Russia’s regions use slightly more than half of the accumulated human capital. Consequently, there are reserves for boosting innovation activity. Indirectly, this is evidenced by the comparison of the level of socio-economic development of the region and the index of effectiveness of the use of human capital. Discussion and Conclusion. The conducted research makes it possible to conclude that increasing effectiveness of the use of human capital will contribute to the growth of innovation in the economy of the regions and thereby facilitate the transition to the model of sustainable development.