Abstract
This study examined the effect of human capital cost on financial performance of listed service companies in Nigeria, while the specific objectives were to examine the effect of human capital cost on return on equity and return on assets of the companies under study. It was on these specific objectives that hypotheses were expressed and formulated. Using the service sector of companies quoted in the Nigerian Exchange Group as the population of the study, five of such companies were selected as the sample size, while the 2020 to 2024 annual reports of these companies served as the sole instrument of data collection. Findings indicated that whereas human capital cost has positive and significant effect on return on equity, the effect of human capital cost on return on assets was positive but not significant. It was therefore concluded that the effect of human capital cost on financial performance was positive but its significance is inconclusive. On the basis of this finding, it was recommended that service companies should invest more on human capital because it is believed that more investment would improve the financial performance of these companies.