The economic health of a country is most often determined by the productivity of the labor force in that country. Labor productivity is a measurement of GDP (Gross Domestic Product) per hour produced by each worker. Or in layman's terms, the value of work completed by a worker per hour. The more work that is produced in an hour, the overall productivity level also increases. It signifies a healthy and thriving economy in a country.
Step
Method 1 of 2: Calculating Labor Productivity
Step 1. Determine the Gross Domestic Product (GDP) of the country
A country's GDP is the value of goods and services produced in a certain period of time. This value is needed to calculate productivity based on GDP.
- You usually don't calculate this value yourself as it will be very difficult. Instead, this value is already defined.
- You can find on the internet the GDP of most countries. Start by searching for the country name plus "GDP". The GDP of many countries can also be found on the World Bank website.
- Make sure you find the right GDP for the time period you're measuring (for example, for a quarter or a year).
- Keep in mind that a country's GDP value, even if released quarterly, may be intended as an annual value. In this case, divide the value by four.
Step 2. Calculate the total number of productive hours of a country
Basically, you're calculating the value of "man-hours" worked to produce products and services. Find the number of people in the labor force for a given time period, then multiply by the average number of hours worked.
- For example, if the average number of hours worked is 40 and there are 100 million people in the country, then the total productive hours is 40x100,000,000, or 4,000,000,000.
- In the United States, these key statistics can be found on the United States Bureau of Labor Statistics (BLS) website.
- Labor productivity for other countries can be found on the internet by searching for relevant economic research.
Step 3. Calculate the productivity
Divide GDP by total productive hours. The result is the country's productivity.
For example, if a country's GDP is $100 billion and its productive hours are 4 billion, its productivity is $100 billion/4 billion or $25 of output per hour worked
Method 2 of 2: Calculating the Productivity of Each Worker
Step 1. Find the Gross Domestic Product (GDP)
GDP measures the total economic activity of a country in terms of goods and services produced. You have to calculate productivity by GDP.
- Fortunately the value of GDP has been calculated, and usually in Indonesia it is submitted by the Indonesian Central Statistics Agency.
- GDP of many countries is available on the internet. Look for the country name plus "GDP". The GDP of many countries can also be found on the World Bank website.
- Find the GDP value for the time period being measured (eg a quarter or a year).
- If the quarterly GDP value is released as an annualized value (as in the United States), divide this value by four for the quarterly measurement.
Step 2. Find the number of people working in the country
To calculate worker productivity, find the number of people working in the country.
In the United States, these key statistics are available on the United States Bureau of Labor Statistics (BLS) website. for other countries, search the internet
Step 3. Calculate productivity per worker
Divide GDP by the total number of people employed. The result is labor productivity for the country.
For example, if the value of GDP is $100 billion, and the number of people employed is 100 million, the productivity of workers is 100 billion/100 million or 1,000 units of output produced per person worked
Step 4. Use the calculated worker productivity
Labor productivity can be used to estimate how much an increase in population or employment can affect GDP. Multiply the productivity of workers by the increase in the number of workers to estimate how much GDP the new workers will affect.
