Labour

Last updated Dec 7, 2022 Edit

• Business

Labour Intensive

• Food processing
• Hotels and restaurants
• Fruit farming
• Hairdressing
• Coal mining Labour costs are higher than capital costs Costs are mainly variable = lower breakeven output Firms benefit from access to source of low-cost labour

Capital intensive

• Oil extraction and refining
• Car manufacturing
• Web hosting
• Intensive arable farming
• Transport infrastructure Capital costs are higher than labour costs Costs are mainly fixed = higher breakeven output

• Greater opportunities for economies of scale
• Potential for significantly better productivity
• Better quality & speed (depending on product)
• Low labour costs

• Significant investment
• Potential for loss competitiveness due to obsolescence
• May generate resistance to change from labour force

Luddite: A term used for workers afraid that technology and automation will take their jobs.

• Unit costs may still be low in low-wage locations
• Labour is a flexible resource—through multi-skilling and training
• Labour at the heart of the production process—can help continuous improvement

• Greater risk of problems with employee/employer relationship
• Potentially high costs of labour turnover
• Need for continuous investment in training

Business