Human capital in the VUCA era: A systematic review of leadership competencies and workforce up skilling for the modern Ethiopian construction industry

Abstract

The construction sector in Ethiopia is an important contributor to the country's national transformation goals but has been impacted by the changing nature of world. Today, the country is operating in a VUCA environment characterised by currency devaluations, supply chain disruptions, and post-conflict recovery challenges. Despite high investment in infrastructure, the sector face a human capital gap, which remains the primary driver of project failure. Research indicates that rigid leadership and a failure to foster psychological resilience are the leading causes of these project failures. This systematic review synthesizes recent research on leadership competency and applied workforce up skilling to create a resilient industry in today's evolving Ethiopian construction sector. Following the PRISMA 2020 protocol, a systematic search of 326 records was completed. From this group, after strict application of the PICOS criteria, 14 records were determined to be eligible for inclusion in this quantitative synthesis.  There is a clear transition away from command and control management models toward adaptive leadership grounded in emotional intelligence (EI), crisis communications, and strategic foresight. The transition is characterised by concept of "leadership agility" - the combination of cognitive flexibility and emotional stability required to navigate institutional complexity and interpret ambiguous crisis signals. At the workforce level, a significant implementation gap exists within  the national skill development system. There is a critical need to develop digital literacy (BIM) and green construction competencies to remain globally competitive. Through data synthesis, it was found that "soft skills"
including conflict resolution and work ethics, have become "hard" functional requirements to navigate site complexity. Additionally, "Human Capital Agility" represents a new imperative in which the workforce at all levels can adapt in real time to market shocks. The findings indicate that human capital (specifically endogenic factors like managerial attitudes and cognitive capacity) is the critical factor determining construction resilience in Ethiopia. Strategic recommendations include establishing a national construction skills council, implementing a competency-based training model to close the industry linkage gap, and mandating adaptive leadership strategic asset. These structural supports, including potential for up skilling insurance, are crucial for protecting the labour market from the volatility of the construction cycle.