What Is Labor Productivity And What Does It Have To Do With You?

July 7, 2016 • Rehack Team


Companies are always looking for new tools, strategies and employees that will make them more efficient and successful. Efficiency is the key to success, and there’s one primary way to measure it – labor productivity.

What It Means

Labor productivity is total output divided by total input. You basically take the amount of money worth of goods created and divide it by the time spent working. For example, let’s say you produce $50,000 worth of product in 1,000 hours of work. Your labor productivity is $50 per hour.

Why should you care about this concept? Well, businesses thrive when run efficiently. So, whether you work for yourself or for a company, you can use your understanding of labor productivity to approach your day-to-day with more business savvy. Here are a few ways you can get started:

How To Use Labor Productivity To Succeed At Work

1. Go Above and Beyond

Labor productivity has been trending down in the United States over the last 10 years. One reason might be workers’ knowledge of technology. What used to boost productivity is now the required minimum you have to know for most jobs.

You can stand out in your job and increase work productivity by going above and beyond what you need to know. Learn every aspect of your job and recognize what needs to be done for the best results. Knowledge is power, and you’ll impress any employer if you know what to do in any situation.

Don’t settle for the lowest requirement. Know the ins and outs of your job to be more productive and get noticed by your boss.

2. Learn New Skills

Companies are looking for the most efficient workers they can hire. With that being said, you’ll look much better to employers if you’ve learned multiple skills.

It’s difficult to raise productivity in service industries because there’s a significant skills gap. This skills gap causes companies to hire more workers than they want to, which often lowers their hourly productivity. If they don’t hire these workers, then certain jobs won’t get done in time, which lowers productivity either more. On the one hand, creating jobs is a great thing but, on the other, creating jobs that exist just to meet a head count can create boring and unfulfilling careers for people.

Take the initiative by learning new skills that are valuable to employers in your industry. This will look good on your resume, and may also allow your employ to depend on you for more tasks, which is good for those of us who like to feel valued by our employers.

3. Work Efficiently

Do you run your own business or work as a freelancer? If so, then you’re responsible for every aspect of your job. Your revenue and hours are based solely on how much work you can get done.

Use labor productivity to measure your own work ethic. Maybe you aren’t making as much money per hour as you hope. Set a goal for yourself and try to reach that goal as quickly as possible. Being aware of your hourly productivity will help you work harder and more efficiently.

4. Use Helpful Tools

Employers are looking to increase company productivity by generating more goods in less time. One way to do this is to use more tools and resources so employees can work faster and better.

No matter what industry you work in, you can always use more resources to be more productive. If you run your own business, you can hire an assistant to go through your emails and take phone calls. This lets you concentrate on your work and limits distractions.

If you work for any company, you can install software that blocks certain websites and social media. Now you can work better and impress your boss with how much you get done. Look for new resources that might become available and help you work harder.

Whether you work alone or for a company, it doesn’t hurt knowing your own hourly productivity and how to improve it. This will only make you a better worker, which always resonates well in any industry.