Table of Contents
What are the advantages and disadvantages of labor-intensive?
Labour intensive
| Advantages | Disadvantages |
|---|---|
| Customised products are easier to make | Quality of products can vary due to expertise of the worker |
| Less expensive machinery costs | Skilled workers take time to train |
| Humans can use their own initiative and problem solve | Skilled workers will be paid more than unskilled workers |
What is labor-intensive production?
Labor intensive refers to a process or industry that requires a large amount of labor to produce its goods or services.
Why some firms use capital intensive production methods and some use labour intensive methods?
Whether a company chooses to use labour intensive or capital intensive methods of production will involve many factors: Finance available – a large amount of capital is required to invest in capital intensive production. Some businesses may not be able to afford to invest in this method of production.
What does labour intensive mean in business?
Industry or process where a larger portion of total costs is due to labor as compared with the portion for costs incurred in purchase, maintenance, and depreciation of capital equipment. Agriculture, construction, and coal-mining industries are examples of labor intensive industries.
What are the advantages and disadvantages of labor intensive and capital intensive business firms quizlet?
The two disadvantages of labor intensive firms is the threat of union agitation or labor unrest, and there are hidden costs associated with employing workers. Two advantages of capital intensive policy is that they dont have to meet large payrolls, and there is a nearly constant rate of productivity.
Why a firm may become more intensive?
Capital-intensive industries tend to have high levels of operating leverage, which is the ratio of fixed costs to variable costs. As a result, capital-intensive industries need a high volume of production to provide an adequate return on investment. All these industries require massive amounts of capital expenditures.
Why is labor intensive industry important?
The role in the economy For countries which are not wealthy and generate low levels of income, labor intensive industry can bring economic growth and prosperity. In most cases, these low income countries suffer from scarcity of capital but have an abundant labor force, such as some Africa countries.
Why would a firm use more labour and less capital?
As real wages rise in the economy, it creates an incentive for firms to invest in more capital to raise labour productivity so the firm can continue to afford the cost of more expensive labour. Therefore, firms become less labour intensive and more capital intensive.
Which is better labor intensive or capital intensive?
While capital intensive is more expensive and requires a higher capital investment, labor intensive production requires more labor input and requires higher investment in training and education of employees.
What are the advantages of labor intensive technique in economic planning?
The arguments in support of the use of labour intensive technique are as follows:
- (1) More Employment Generation:
- (3) Decentralisation:
- (5) Higher Level of Consumption:
- (7) Creation of Economic and Social Overheads:
- (9) Saving of Foreign Exchanges:
- (11) Better Utilization of Local Resources:
What are the differences between a labor intensive and a capital intensive approach Name two advantages and two disadvantages of each?
Which is cheaper capital intensive or labour intensive production?
Production machinery may be very expensive, but aims to be cheaper than labour intensive production in the long run. Labour costs are higher than capital intensive production, however they can vary. If the task is simple then automation may not be necessary.
When are labour intensive techniques are adopted with?
When labour intensive techniques are adopted with that cottage and small scale industries are run with the help of locally available raw material. In these industries then the women and children all get an opportunity to participate and join.
What are the disadvantages of labor intensive industries?
Disadvantages of labor costs in labor-intensive industries include limited economies of scale, as a firm cannot pay its workers less by hiring more of them, and susceptibility to wage forces within the labor market.
Why was food production so labor intensive in the past?
Producing food was very labor-intensive. Technological development and economic growth have increased labor productivity, reduced labor intensity, and enabled workers to move into manufacturing and (more recently) services.