Productivity
A measure of output per unit of input, showing how efficiently resources are being used to produce goods or services.
Formula
Labour Productivity = Output ÷ Number of Workers
Real World
Toyota's lean manufacturing system produces around 10 million vehicles a year with roughly 370,000 employees, giving it one of the highest labour productivity rates in the automotive industry.
Exam Focus
Always state the unit of productivity (output per worker, per hour) and link higher productivity to lower unit costs.
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