Evaluation of Labor Productivity Using a Corrected Production Staff Number Approach in the Chemical Industry

Abstract

In the chemical industry, a labor productivity index is often used to estimate production efficiency. This index is often taken as the ratio of the production return to the production staff number. In this form, the index implies that a reduction in the number of production staff leads to an improvement in labor productivity. However, such an approach can lead to accidents and industrial unrest at a plant. Consequently, this definition of the labor productivity index does not accurately reflect reality. This paper proposes an alternative index, which combines the production skills of the production staff, or the value of skills, with the labor productivity index, to provide a more accurate and realistic estimate. It is also shown that an improvement in production skills contributes to an increase in labor productivity. A case study, in the chemical industry, is used to demonstrate the validity of the proposed method.