How is labour productivity calculated, and what does the figure tell a manager?

Labour productivity = total output ÷ number of employees, and it tells a manager how much each worker is producing, so it can be tracked over time and compared with rivals.

Output rises to 13,800 units a month with the same 40 employees. Calculate the new labour productivity and the percentage increase.

Productivity becomes 13,800 ÷ 40 = 345 units per employee, a rise of 45 units, which is 45 ÷ 300 × 100 = 15%.

State the formula for labour cost per unit.

Labour cost per unit = total labour costs ÷ total output.

Total labour costs are £180,000 and output is 12,000 units. Calculate the labour cost per unit.

Labour cost per unit is £180,000 ÷ 12,000 = £15 per unit.

WJEC A-Level Business 601-5238-2

Enterprise and Starting a Business

Topic overview Enterprise and the entrepreneur Stakeholders in a business Business plans and sources of support Legal structures of business The public and private sectors Business location Sources of finance for a new business Business revenue, costs and profit

Markets and Market Research

Topic overview Types of market Market size, market share and market trends Market segmentation The degree of competition in a market Perfect competition and monopolistic competition Oligopoly and monopoly Consumer protection Demand and the demand curve Supply and the supply curve Market equilibrium and changes in price and quantity Price and income elasticity of demand Inferior, normal and luxury goods The value of market research Primary market research Secondary market research Qualitative and quantitative data Sampling and avoiding bias

Marketing

Topic overview Market orientation, product orientation and asset-led marketing The marketing mix Product and the product portfolio Branding, USP and differentiation The product life cycle Extension strategies The product life cycle and cash flow The Boston matrix Pricing strategies Choosing the right pricing strategy Promotion: above the line and below the line Place and distribution channels The marketing mix in different contexts and global marketing New technology in marketing

People in Business

Topic overview The flexible workforce New technology and changing working practices Workforce planning The recruitment process, job analysis and job descriptions Internal and external recruitment Methods of selection Training Appraisal Labour productivity, absenteeism and labour turnover Organisational design and structures Delegation, empowerment and delayering Motivation theories Financial and non-financial methods of motivation Management and management by objectives Leadership styles and theories Employment rights, duties and equal opportunities Trade unions, conflict and dispute resolution

Operations Management

Topic overview Added value Job, batch and flow production Choosing the right method of production Productivity Capacity utilisation New technology in operations Lean production and kaizen Just-in-time and cell production Quality control and quality assurance Total quality management Stock control and stock control diagrams Purchasing and working with suppliers Innovation, research and development Internal economies of scale External economies of scale Diseconomies of scale and the survival of small firms

Business Finance and Accounts

Topic overview Internal sources of finance Loans, overdrafts and trade credit Share capital and venture capital Leasing and debt factoring Choosing an appropriate source of finance Finance for entrepreneurs and SMEs in Wales Revenue, costs and profit Types of cost Contribution and break-even Break-even charts and the margin of safety Budgets and budgeting Cash flow forecasting Improving cash flow The income statement Gross and net profit margins

Business Analysis and Decision-Making

Strategy and Implementation

Topic overview Aims and objectives SMART objectives Mission and vision statements Corporate, divisional and functional strategy Strategy, tactics and corporate plans SWOT analysis Porter's Five Forces The Ansoff matrix Organic growth Mergers and takeovers Horizontal and vertical integration Franchising as a method of growth Location and relocation decisions Rationalisation and outsourcing production

Managing Change and Risk

Topic overview Internal and external causes of change Planned and unplanned change The effects of change on a business Managing change effectively Storey's four approaches to managing change Resistance to change Lewin's three step process Organisational culture and leadership in change Evaluating the management of change The risks a business faces Risk assessment and preventative action Insurable and uninsurable risks Contingency planning and crisis management

The External Environment

Topic overview Government and the framework for business The economic environment Social and demographic change Technology and business Business ethics and corporate social responsibility The legal environment Business and the environment

Global Business

Topic overview International trade and protectionism Globalisation and its causes Global growth strategies and multinationals The European Union and the euro

People in Business

Labour productivity, absenteeism and labour turnover

3 things to know
AS Unit 2

Overview

Labour productivity, formula for labour cost per unit and formula for the absenteeism rate.

What you need to know

Answer each one before you reveal it.

Your recallNot started

Key term

Explain why a rise in wage rates need not raise labour cost per unit.

Key term

Define labour productivity.

Numbers

A factory produces 12,000 units in a month using 40 production employees. Calculate labour productivity.

Questions from this subtopic

Each one with the model answer underneath.

1
Define labour productivity.
Model answer
Labour productivity is the output produced per employee over a given period of time.
2
How is labour productivity calculated, and what does the figure tell a manager?
Model answer
Labour productivity = total output ÷ number of employees, and it tells a manager how much each worker is producing, so it can be tracked over time and compared with rivals.
3
A factory produces 12,000 units in a month using 40 production employees. Calculate labour productivity.
Model answer
Labour productivity is 12,000 ÷ 40 = 300 units per employee per month.
4
Output rises to 13,800 units a month with the same 40 employees. Calculate the new labour productivity and the percentage increase.
Model answer
Productivity becomes 13,800 ÷ 40 = 345 units per employee, a rise of 45 units, which is 45 ÷ 300 × 100 = 15%.
5
State the formula for labour cost per unit.
Model answer
Labour cost per unit = total labour costs ÷ total output.
6
Total labour costs are £180,000 and output is 12,000 units. Calculate the labour cost per unit.
Model answer
Labour cost per unit is £180,000 ÷ 12,000 = £15 per unit.

See the rest and revise

Other ways to work this

The same content, four other ways.

What is inside Levo

Six ways to work the same material.

1Closed book

2Open book

3Closed book

See a huge jump in your memorisation

Answer cold, learn it, then prove it stuck. Levo tracks the jump between your first attempt and your last.

Enterprise and Starting a Business

Markets and Market Research

Marketing

People in Business

Cram a whole paper in one sitting

Sort every topic into what you know and what you do not, then drill only the weak ones.

Gross profit = − cost of sales.

revenueprofitexpenses

Blank Blitz consolidates the facts

Rapid timed gap-fills on the terms and numbers you need to recall without thinking.

AShort-term disruption depresses the early figures.

BThe benefits build up as people become proficient.

CAn early judgement is usually too harsh.

Build It trains answer structure

Assemble a full-mark answer from its marking points, in the order an examiner wants them.

Need means something essential for survival, such as food, water or shelter.

TrueFalse

Test It catches misconceptions

Spot the fault in a statement. The traps are the mistakes students actually make.

721941163128510

Brain Breaks between sessions

Short focus games to reset attention, so the next set lands better than the last.

Every question in People in Business, on a schedule.

Attempt a question from memory, write the correct version, then attempt it again. Levo records the jump between your first attempt and your last, and brings each question back on the day you are due to forget it.

Start revising, £5 a month See how the method works

Or £46 a year, about £3.83 a month. Cancel anytime.