Improving labour productivity: A collaborative approach to identifying benchmarks, impediments and opportunities

Summary

Labour productivity is a major factor in the profitability of sheep meat and beef cattle enterprises.  Recent projects and reviews have indicated that improvements in labour productivity can have positive impacts on business profit, and also that there is a wide range in measured labour productivity between producers.  This study sought to survey a range of businesses to compare and contrast the attitudes, practices and performance between higher and lower labour productivity businesses.  In developing practical measures of labour productivity, a report was commissioned and completed by Roberts Evaluation to allow a theoretical base for motivation and productivity to be developed.  Information was collected from 148 businesses.  Information was analysed for Drivers and Impediments to labour productivity, where labour productivity was measured on DSE/Labour Unit.
While the limitations of the survey are noted, this project has identified a number of key issues for the industry.The link between Innovation and Motivation and labour productivity (DSE/FTE) was evident, however the correlations were not always strong.  This suggests that there may be other factors which may modify the strength of these relationships.  Addition of a cropping enterprise may be one such factor.Labour management appears to be an area which the industry can improve.  With some 45% of all contributing businesses using unpaid family labour, and with 60% expressing dissatisfaction with their employment roles and conditions, this is a big issue for the industry.  This issue may be caused by individual business profitability (capacity to pay), attitudes (willingness to pay) and perhaps even an issue related to succession planning (the right to be paid).Improving business processes to enhance time management, the level of innovation and improve the business were areas which were highlighted.  It was interesting to note that the level of training was considered adequate.  There may be an issue of finding time to apply new ideas and knowledge gathered through training.  The type of training was not examined, and it may also be due an issue of the quality and content of the training not being appropriate for the business.  Impediments in this area may also need further work.Larger farms had a lower level of motivation and innovation.  Given both these factors are linked to labour productivity; this is an area of concern to the industry, particularly in the extensive areas which consist of larger farms.