Labour Productivity and Employment in Australian Manufacturing SMEs

Abstract This paper examines the relationship between labour productivity and employment in Australian manufacturing small and medium enterprises (SMEs). The results indicate that labour productivity of SMEs varies substantially between industries within the manufacturing sector, but on average labour productivity for manufacturing SMEs increased at a faster rate than that of large manufacturing enterprises across all industries. All manufacturing industries except one recorded employment growth during the period under study. However like labour productivity growth, employment growth also varies across industries within the manufacturing sector. Yet the study could not establish any definite relationship between labour productivity growth and employment. This finding is consistent with some previous studies