Indirect Labor Productivity

Indirect labor productivity refers to the efficiency of workers who support the production process but aren't directly involved in creating goods or services, such as managers, administrative staff, and maintenance workers. While direct labor focuses on the hands-on production, indirect labor ensures that operations run smoothly. High indirect labor productivity means that these support roles contribute effectively, enhancing overall efficiency without wasting resources. Measuring this productivity helps organizations understand how well they're utilizing all their workforce to achieve business goals, leading to improved performance and profitability.