<p>Knowledge, skills, and experience collectively make up human capital, which is essential for economic growth, productivity, and innovation. However, in developing countries, investments in training frequently fail to produce the desired results due to issues such as skill mismatches. The purpose of this study is to investigate the effectiveness of these countries’ training investments, as well as their impact on employment and economic growth. This study employs an econometric model incorporating fixed and variable effects to assess the influence of human capital expenditure on employment across developed and developing nations. It investigates the connection between education/training spending and economic activity. First, we find that investment in education and training in developing nations does not always result in the anticipated impact on employment and, consequently, economic growth. Second, we find that that investment in human capital within developed countries positively influences economic growth by reducing the unemployment rate. Overall, our findings highlight the need for policy adjustments to optimize investments and address skills gaps. This study provides important insights for policymakers in designing educational initiatives that avoid negative impacts on investment and productivity, while achieving sustainable economic growth and social development.</p>