Looking for cost savings in administrative areas, the vice-president for human resources at McMahon Corporation asked his assistant to collect data on the employee cafeterias in the four McMahon locations around the country. After two days, the assistant returned with the following data for the previous year. Mobile Pecos Spokane Lansing Labor-hours 35,000 55,000 22,500 5,250 Meals served 114,000 216,000 74,000 13,500 Required: a. Compute the partial productivity measures for labor for the four locations. (

McMahon Corporation

Partial productivity measures for labor for the four locations:

                               Mobile     Pecos     Spokane     Lansing

Labor productivity   3.26         3.93          3.29           2.48

(meals per labor

hour)

Explanation:

a) Data and Calculations:

                               Mobile     Pecos     Spokane     Lansing   Total

Meals served        114,000   216,000     74,000       13,500   417,500

Labor-hours          35,000    55,000     22,500        5,250    117,750

Labor productivity  3.26         3.93            3.29           2.48      3.55

b) Labor productivity is computed as total output divided by labor-hours (labor input).  It is the manpower or workforce productivity.  It is one of the productivity measures with capital as the other measure.

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