Massive layoffs raised labour productivity

The construction sector leads in terms of increase in labour productivity in H1 2009 (with a 10.9 percent growth rate), followed by agriculture (with 6.4 percent), financial and real estate activities (5.4 percent), and industry (3.7 percent). The only sectors that registered a drop in productivity during the economic downturn were trade, hotels, and restaurants (with a decline of 2.1 percent), according to calculations by Business Standard based on data provided by the National Institute of Statistics (INS) regarding the evolution of the number of employees and net sales in the first six months of 2009.

“We usually define productivity as a ratio of a company’s net sales to the number of employees. If the number of employees drops by more than sales have, theoretically, productivity increases,” said Sandra Jitianu, Ensight Management Consulting Manager.

According to Aurei Cadis, Managing Consultant of Horváth&Partners Romania, the industries that were most affected by the crisis in terms of productivity are those in which employees are least motivated – especially if the company’s top management has not “dealt with” this problem.

“In the auto industry, for example, which faced restructuring and personnel downsizing, this problem is obvious, with declines of up to 50 percent in productivity and motivation,” Cadis said.

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