Labor productivity

The manufacturing cost consists of direct, indirect, distribution, and fixed costs. Direct costs are raw materials, operating labor, production supervision, utihties, suppHes, repair, and maintenance. Typical indirect costs include payroll overhead, quaHty control, storage, royalties, and plant overhead, eg, safety, protection, personnel, services, yard, waste, environmental control, and other plant categories. However, environmental control costs are frequendy set up as a separate account and calculated direcdy. The principal distribution costs are packaging and shipping. Fixed costs, which are insensitive to production level, include depreciation, property taxes, rents, insurance, and, in some cases, interest expense. 

Labor productivity is very much dependent on the health and well-being of the workers and also on the availability of laborsaving tools and construction equipment. The frequency of strikes, hohdays, slowdowns, and pohtical unrest will also depress productivity. Closed-shop practices or demarcation disputes will also affect the productivity of labor. The use of standard equipment, parts, and methods tends to improve productivity. 

Fiber drums are also made with a removable fiber top and a fiber bottom that is either removable or permanently fastened to the body. This drrtm has limited reuse, brrt it costs less than the lever-locked metal-top type. Filling equipment consists most commonly of an operator-controlled spout connected to a supply bin resting on a platform scale. Table 21-26 shows the labor productivity of several systems. 

Field labor usually runs 25% to 50% of the cost of a project. If one location has 20% lower labor productivity, the cost of the project may increase by 5% to 10%. Contractors have a good feel for the expected productivity in a given area. Such productivity adjustments are usually made with the U.S. Gulf Coast as unity. 

Every location has advantages and disadvantages that impact on the operating costs. Data must be collected for the proposed site and used to adjust historical data to get a proper estimate. Such costs as transportation, labor, and purchased utilities can be determined. However, such items as operating labor productivity, local customs, weather, and local management attitudes can only be estimated. 

A large portion of the cost of any manufactured item is represented by labor. Although labor rates are more and more becoming similar in most parts of the country, factors such as skill, labor relations, and the general welfare of the work force affect labor productivity and efficiency. Each region being considered for plant location must be suiveyed to determine the availability and the skills of the labor market. The skills need not exactly match with those... 

Labor productivity is increased by using better working methods, equipment to magnify the efforts of humans, and power units to operate... 

Gupta (2002) reexamined the impact of partial privatization on firm performance, using data on the sale of noncontrolling equity stakes on the stock market by state-owned enterprises in India. He found that partial privatization has a positive and highly significant impact on the sales, profits, and labor productivity of these firms. 

According to the vendor, Pentagone will achieve superior extraction efficiencies that will result in less labor, product usage, and hazardous waste. These features lead to a lower overall... 

Country or Region Labor Cost ( /year/operator) Labor Productivity ( /year/employee) Ratio... 

Historically, technological innovation has been a prime force in economic development. New processes and products have been credited with such diverse benefits as increased employment, increased labor productivity, new opportunities for preventing and curing disease, greater consumer comfort, and improvements in the balance of trade. 

The McKinsey Global Institute has analyzed operational performance improvements in the industry over time, based on an investigation into labor productivity. Betweenl991 and 2003, the average annual growth for German chemical companies was 5.5 percent, in France it was 3.3 percent, 3.2 percent in the USA, and finally 2.6 percent in Japan. 

Behind these broad numbers lies an interesting detail. With the exception of Japan the smallest growth in average labor productivity has basically occurred in the most recent time period (1998-2003). The difference is most pronounced in Germany, where the average productivity improvement was just 2.5 percent per year in 1998-2003 compared to the overall figure of 5.5 percent for the full twelve-year period. France also fell considerably, from 3.3 percent to just 1.5 percent (Fig. 18.1). 

Finally, the director of pharmacy pays special attention to external financial reports. Professional associations such as the American Hospital Association and the American Society for Health-System Pharmacists publish reports that show the national trends in pharmaceutical expenditures and labor productivity in hospitals (American Hospital Association, 2007 Hoffman et ah, 2005). Pharmacy managers can gauge the efficiency of their operations by comparing their financial ratios and other indicators with national averages. 

An extensive effort is being made to collect current cost data from the first quarter (June 1976) to 1979. Particular attention has been paid to accurate representation of the effect of different plant locations (land costs, labor productivities, labor costs, construction difficulties, etc.) and date of construction (escalation of the cost of construction material and labor, and installation material and labor, etc.). Also, great care has been given to the proper estimation of the cost of offsites, since they represent a significant fraction of the cost of a new plant, particularly for large coal-conversion plants. 

The Moldflow Plastics Xpert (MPX ) process automation and control system decreases mold setup time, cycle time, and scrap, and improves molded part quality and labor productivity. Unlike traditional trial-and-error methods, MPX tools provide a consistent and systematic method for improving and optimizing the molding process. 

Assuming that the process is highly automated, we find from Table 4 that b = 0.76 and that the process productivity, K = 0.174. Assume that p, the labor productivity increases at an annual rate of 2% since 1952. Twenty-six years have elapsed since 1952, therefore n = 26. Substituting into Equation 2.1, the number of hours of operating labor for a kilogram of the total product. 

Successful players in specialties have traditionally been less dependent on pure cost-reduction efforts, and these companies have consequently made less of an effort to improve production. In the United States, labor productivity increased by about 5 percent per aimum for plastics, as opposed to around 2 to 2.5 percent per annum for paints, fine chemicals, and pharmaceuticals over the last two decades. 

Eastman Chemical has set up a powerful two-part incentive system for all its employees, not only manufacturing personnel. On the one hand, the top 600 managers have to put between 10 and 40 percent of their salary at risk. However, they can earn a bonus of up to 80 percent of their base salary depending on the economic value created, the increase in sales volume, and the improvement in labor productivity. Furthermore, they are required to own Eastman stock worth between 50 and 400 percent of their annual income. 

How important is labor productivity to schedule and what is the local... 

The execution approach and contracting strategy will affect engineering costs, labor productivity, and field indirects. Since the cost impact could be substantial, the estimate package must include at least a simple description of the execution plan. 

The unit hours in the estimating procedures, in Chapter 19, are based on so-called Gulf Coast productivity which tends to be conservative since it is mainly based on a direct-hire situation and unionized labor practices. They very seldom find their way into an estimate but are adjusted, up or down, to reflect specific project requirements, contracting strategy and general business conditions as well as local labor availability and atmosphere. It is up to the Project Manager to ascertain the validity of the labor productivity used in developing construction man-hours. Labor productivity is discussed in some detail in Chapter 19. 

Labor productivity and total labor cost is another important factor with a heavy impact on the total cost of the project. Even if there is a hardworking labor force their productivity could be affected by the lack of the proper hand tools and construction equipment. 

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