The company currently employs 50,000 people to manufacture 200,000 units
Comparing the output of each employee with the total number can help determine a change in productivity. It is essential to measure both the production rates of each employee and the overall output for the entire company. These figures can be used for calculating a base productivity per employee.
If 10 people produced 1,000 units of product per month, then the average production rate for each person would be 100 units (1 000/10). If this number decreases due to fewer employees now working at the company – say 8 individuals instead – then overall production will also go down accordingly (800/8 = 100). The decrease in worker productivity is due to the fact that there are fewer workers available to create goods and services.
When determining the changes in worker output, it is necessary to take into account other factors such as employee turnover rates and technological developments that could affect how tasks are performed over time. Managers must also monitor and analyse data regularly to ensure processes continue to be efficient during periods of reduced staff availability.