THE UNIVERSITY OF ZAMBIA

IN ASSOCIATION WITH

DAVID LIVINGSTONE COLLEGE OF EDUCATION

SECONDARY TEACHER’S DIPLOMA

BY EXTENSION STUDIES (DES)

NAME : KAREN, M. NYAMBE

DALICE NO. : 182020649

SUBJECT COMB. : ENG/SOCIAL STUDIES

COURSE : SOCIAL STUDIES: ECONOMICS

LECTURER : MS. KAMOTO

YEAR OF STUDY : 2018 (1st Year)

QUESTION:

Assignment One:

What is Labour Productivity? Discuss factors that influence labour productivity.

Due Date: 23rd February, 2018

Length: 4 pages
This paper will define labour productivity and discuss the factors that affect labour
productivity.

Labour productivity is commonly used in a variety of contexts with different meanings;

formally, productivity is defined as the output produced per unit of time (Rojas, 2008);
Economists define the productivity of a country’s labour force (or “labour productivity”) as
the amount of output a typical worker turns out in an hour of work (Banmol and Blinder,
2009). Following these definitions, labour productivity is thus determined by dividing output
quantity by time where the latter is generally expressed in hours as LP = Q/t.

For example, if it takes 100 hours to produce 200, 000 loaves of bread, labour productivity
for this final output 2, 000 loaves per hour. A similar statement can be made in intermediate
outputs such as transport trucks, for instance, if it takes 10, 000 hours to produce two trucks,
labour productivity is one truck per 5, 000 hours. Thus, the importance of labour productivity
in any economy cannot be over-emphasized.

Comprehensively, Barro (2008) and Rostering (2010) highlight that, productivity is very
important to the economy, because it is closely correlated with the standard of living. The
higher the productivity of a worker, the higher the price a company can afford to pay that
worker to get that worker to work for them. Notably, a company sells its goods for a given
price, a price that is fixed by the market. So if a worker can produce a lot of goods in a small
amount of time, the company can afford to pay him or her high wage. Labor productivity is
correlated with wages. The higher labor productivity is, the higher the wages companies can
afford to pay their workers without sparking inflation; that is, without pushing up the prices
of goods and services. The more output you get from a given amount of labor, the higher the
wage you can afford to pay your worker in an environment with stable prices.

So, productivity is correlated with the standard of living. Higher productivity means higher
wages for workers, more output per worker and a higher standard of living in the economy.
One of the things that characterize economic growth is an increase in the productivity of
labor. When technology advances, when capital accumulates, when skills are being acquired
by the labor force and when new natural resources become available, the productivity of
labor rises, and this one of the hallmarks of economic growth.

Having comprehensively defined what labour productivity is, it must however be said that
labour productivity is affected by numerous factors, both negative and positive. What this
entails, like in the previous example, it is not guaranteed that 200, 000 loaves of bread will be
produced in 100 hours; machines can fail, there can be lack of manpower (labour), lack of

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materials etcetera. To be precise, the following are some key factors that affect labour
productivity: skilled labour availability, resources or materials availability, supervision,
changes in technology, wages, motivation, and training of the work force among others
(Amanuel, 2016).

To make a comprehensive discourse, Rojas (2008); Hassan (2013); Shree Raja Gopal and
Murali (2016) and Amanuel (2016) categorize these factors as follows: design factors;
material related factors; equipment and technology related factors; labor related factors;
supervision related factors; health and safety related factors; and external factors. In
presenting such factors, the discussion will dwell on the negative and positive effects
interchangeably.

On design factors according to Amanuel (2016), generally, projects come across some
design, drawings and specification changes during construction, for example. If drawings or
specifications are with errors and unclear, productivity is expected to decrease since laborers
in the field are uncertain about what needs to be done. As a result, task may be delayed, or
have to be completely stopped and postpone it until clear instruction. Explicitly, if say
constructing a house, for example, is supposed to take three months following a certain plan.
Should there be any alterations in the initial plan, it means that the time factor also needs
adjustment. So, if it is a company and the deal is set that if a house is built within three
months the pay would be K50,000 and there are 10 houses to be built, but ends up building
less, 6 for instance, due to design changes, inaccurate design or incomplete diagram, the
intended output will not be attained or will be less.

Poor material management is also one of the most key factors that affect productivity.
Productivity at the projects can be affected if required materials are not available at the
correct location and time. Also insufficient or poor material handling may disrupt normal
work flow (Banmol and Blinder, 2009 and Hassan, 2013). Poor-quality material used for
work is the other factor because poor materials generally lead to unsatisfactory work and can
be rejected by supervisors, thus reducing the productivity. Practically speaking, as earlier
mentioned, a company making 500 loafs of bread in an hour is not expected to give the same
output if for example, flour, or yeast, baking powder or other materials are not there of
inadequate.

Narrowing down to equipment and technology, Rojas (2008) outlines that inappropriate type
and size of equipment often affects the productivity of most projects. Lack of equipment and
frequent malfunctioning of equipment may as well make laborers delay to complete the
specific work. Notably, technology advancement also has an effect on overall productivity.

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Tools and machinery have increased both in power and complexity. These advances in
technology can significantly change skill requirements.

Human beings alone would not manage to perform certain tasks to produce massive output.
For example, human beings would not efficiently or timely (quickly) lift heavy steel to use in
roofing of a story building, for instance. To lift such heavy metals, a crane is ideal. Also,
humans cannot literally transport goods over a long distance timely, thus the use of
equipment or technologies such as trucks, goods aero planes or goods train. These may
improve labour productivity.

On the other hand, literatures describe that technology can enhance productivity of individual
tasks. While technology can generally improve labor productivity, there is a cost associated
with employing technology. Improvement in labor productivity is not an ultimate goal. For
example, capital investment in technology can be increased to improve labor productivity, but
this approach may not be the optimal solution when overall costs and benefits are considered
(Rostering, 2010). Ultimately, decrease in productivity is usually caused when there is
insufficient quantity or quality of tools and equipment to meet the needs of the project,
frequent damage of equipment and absence of technological advancements for machineries.

Labour plays an important role in labour productivity. Labor related factors can be thought in
the following ways: firstly, there should be sufficiently skilled and experienced laborers on
projects in order to make the projects productive. If labors are unskilled and inexperienced,
they would take longer time to complete specified task and there will be a possibility of
rework, therefore incompetence of labors can be considered as one of the possible causes for
the decrease in productivity. Secondly, misunderstanding among laborers creates
disagreements about responsibilities which lead to a lot of work mistakes resulting rework
and consequently it decreases labor productivity (Amanuel, 2016 and Shree Roja Gopal and
Murali, 2016).

In some cases, it is usually thought that too many workers are likely to complete work in a
shortest possible time. Though this may be true, overcrowded labor force on projects is found
out to be one of the main reasons for low productivity, according to (Rostering, 2010).
Additionally, over-employment of staff may as well cost the employer, that is, each labourer
would require a good pay – also the company or employer will need to make profit, pay taxes
etcetera.

Supervision also matters in labour productivity. Work inspection by the supervisor is an

essential process to proceed with the work. For example, the contractor cannot cast concrete

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before an inspection of the formwork and steel work, thus affecting labor productivity (Zakeri
et al, 1996 in Amanuel (2016)). With non-completion of the required work according to the
specifications and drawings, supervisors may ask for the rework of a specific task. Unclear
instruction given by supervisors, change of supervisors, incompetence of supervisors and
supervisors’ absenteeism are some of the major contributing factors for low labor
productivity.

Furthermore, during work, like at construction projects, accidents frequently happen. These
may have high impact on labor productivity. Some accident types occur at the site can cause
death; death resulting in a total work stoppage for a number of days. According to Barro
(2008) and Banmol and Blinder (2010) providing safety equipment and employing a safety
officer helps labors to recognize the required safety regulations and to follow them, which
can reduce the number of accidents, thus increasing productivity.

Lastly, labour productivity can also be affected by external factors such as weather conditions
(natural factors). According to Amanuel (2016) weather conditions are significant factor to
consider for completion of any construction project. Adverse winter weather, such as winds
and rains, reduces productivity, particularly for external work such as formwork. For
example, in cases where there are heavy rains, builders or constructors cannot go ahead with
plastering or laying the slab, because the rains can wash away the residue.

In addition, law and order, stability of government, etcetera are essential for high productivity
in the construction industry. The government’s taxation policies influence willingness to
work and expansion of plants. As early alluded, employers pay tax to stay legitimate and
contribute positively to the economic stability of the country. However, if labour institutions
are over taxed, low productivity is highly likely, because companies will have to maintain the
productivity. In some instances, high resort to unemployment, low production than usual,
hiking of goods and services, etcetera.

In conclusion, labour productivity has ultimately been defined as the measures the amount of
goods and services produced by one hour of labour and the amount of real gross domestic
(GDP) produced by an hour of labour. Relative to the aspect of labour, input, output and time,
the major factors that affect labour productivities have been categorized in terms of: design
factors, materials related factors; equipment and technology related factors; labor related
factors; supervision related factors; health and safety related factors; and external factors.
Ultimately, if all these factors are met, labour productivity would be very good and high.

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 REFERENCES

Amanuel, M. (2016). A Study on Factors Affecting Labor Productivity on Building

Construction Projects in Addis Ababa, Ethiopia. Addis Ababa: Addis Ababa University.

Banmol, W.J and Blinder, A.S (2009). Economics: Principles and Policy 11th Edition.
Mason, OH: South-Western Cengage Learning.

Barro, R. (2008). Macroeconomics: A Modern Approach. Mason, OH: Cengage Learning.

Hassan, S.H. (2013). Factors Influencing Labour Productivity and the Impacts on
Construction Industry. Pulan Pinang: Universiti Teknologi Mara.

Rojas, E.M (2008). Construction Productivity: A Practical Guide ford Building and
Electrical Constructors. Fort Lauderdale, FL: J. Ross Publishing, Inc.

Rostering, F.M (2010). Needs and Limits: A New Economics for Sustainable Well-being 3 rd
Edition. New York: Lulu Publications.

Shree Raja Gopal, T.G and Murali, K. (2016). Analysis of Factors Affecting Labour
Productivity in Construction. Tamil Nadu: Sri Ramakrishna Institute of Technology.

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