Labour Productivity as a Factor of Tangible Investment in Companies Producing Wind Energy Components and Its Impacts: Case of Lithuania

Abstract

This paper aims at justifying the significance of investment in the improvement of labour productivity (LP) and importance of the latter on economic performance of companies manufacturing wind energy components (WEC) in Lithuania in terms of value added (VA) created, profitability and wage earned. The time period covered is 2000–2020. The following methods have been employed: analysis of legal acts, programmes, strategies, and business structure and finance indicators, interdependence (correlation and regression), trend, case analysis, logical economical reasoning and graphical representation. The research results of current status analysis showed that the business of WEC manufacturing is small in regard to their variety of products but increasing in terms of VA and employment in Lithuania. Investment has been found as a driver of improvement in LP. The calculated historical ratio of change in LP to investment showed that, on average, after 1000 EUR per employee has been invested in tangible assets (TA), the LP increased by 0.13 EUR/h. A higher than average ratio was found in the manufacture of other transport and repair and installation of machinery and equipment (1.41), such as rubber, plastic and other non-metallic mineral products (0.17), but lower in the manufacture of electronic and communication (0.12) and metal (0.06) products. Taking into account the linear curves of LP to investment in TA curve and the average volumes of investment in different manufacturing activities, it is estimated that LP could grow by 5.3% a year in the manufacture of electronic products, and communication equipment are expected to increase by two-fold to 33 EUR/h in 2030, but it could grow only by 2.0% a year in the manufacture of rubber, plastic and other non-metallic mineral products to reach 28 EUR/h in 2030. Due to investment related changes in LP, the VA created by WEC companies could increase by 5.9% a year and account to 2.9 billion EUR during 2021–2030. Net profitability and real wages (and salaries) could also increase in future. Seeking to use the potential of companies to manufacture WEC for domestic wind installations and exports, investment supporting programmes are of high importance in the fields of promotion of innovations, development of human capital and adaptation of new technologies.