What does efficiency mean?
Controlling costs when making goods or services and a good use of time and energy
How can you measure the efficiency of a business?
Labour productivity
Unit costs
Capacity
Capacity utilisation
What does labour intensive mean?
When labour costs outweigh the capital costs of a business
What does labour productivity mean?
The amount of output that is obtained from an employee
How would you calculate labour productivity?
Labour productivity = output per period
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No. Of employees in that period
What can affect high labour productivity?
Quality of machinery, resources etc for staff to use
Skills, motivation and ability of the workforce
The methods of production used
Reliability of raw materials and suppliers
How can labour productivity be increased?
Increasing the number of hours worked
Investment in equipment and technology
Changing the way the work is carried out
Motivating employees
How is unit costs defined?
The cost of producing one unit of output
