Scientists call them epithelial cells. These cells leave the bulge and migrate up to the epidermis. There they wait until they're called upon by the epidermis. At that point, they proliferate and turn into epidermal cells, which help replenish and maintain the top layer of skin. Not surprisingly, hair and skin are closely allied chemically.
Hair is made of keratin, a protein that is a product of epithelial cells.
The discovery that hair and skin have the same birthplace, so to speak, may have broad implications. Basal cell cancer is the most common form of skin cancer. The discovery also may point the way to new treatments for a number of skin diseases. One could be psoriasis, an incurable condition in which skin cells proliferate with abnormal rapidity, forming thick and scaly red patches. As many as 5 million Americans may suffer from psoriasis.