Effects of Health, Job Incentives and Education on

Labor Productivity

1.1 Introduction
Labor productivity
Labor productivity is a very important factor towards the economic growth of every country. For
being developed and to achieve high levels of growth, highest labor productivity is a key factor.
To enhance the labor productivity there are several factors which are having their worth in this
regard. Health plays an effective role because a sound body with a sound mind can produces high
results. Human and physical capital enhanced the per capita GDP through improving
productivity coupled with resource buildup and technical advancements. Innovation in medical
technologies, better sanitation and nutrition are achieved by economic development, this reduces
the infant mortality rate and increases the life expectancy.
For some group of workers education is a strong determinant to boost up their productivity. And
others feel that it has less directly relate to their productivity. Education helps to increase the
ability of the workers to absorb, understand and act on new instructions. They will be more
responsive with more education. Educated individuals have more ability to innovate and produce
rather the uneducated. Higher education provides exposure for better career development. Work
level of employees is controlled by the educational background.

1.2 Problem Definition

Main purpose of this research work is to check the effect of health, labor force participation rate
and education on labor productivity. That how these are relevant to labor productivity and how
they effect directly or indirectly.

1.3 Research Objective

Objective of this research includes the relation among the labor productivity and the health of
labors that how they contribute to the high levels of production and consistent economic growth.
Partly it includes the relation of education too that educated labors are being observed more
productive then those of illiterate.

1.4 Conclusion
Finally the labors health, participation rate by age, gender educational levels etc and education
are directly related with the labor productivity. If all these factors will be high quality and easily
available for poor and middle class labors with equal rights and opportunities, then the labor
productivity will ultimately be raised.

UK Government Expenditure on Education

Year

Population-UK
million

Education -total
billion

1979

54.32

16.01

1980

54.68

16.78

1981

54.98

17.21

1982

55.23

17.89

1983

55.89

18.32

1984

56.12

18.56

1985

56.22

19.25

1986

56.45

19.63

1987

56.75

20.23

1988

56.98

21.96

1989

57.221

22.00

1990

57.330

24.60

1991

57.439

26.50

1992

57.604

29.30

1993

57.770

32.73

1994

57.936

34.42

1995

58.103

36.05

1996

58.270

36.49

1997

58.438

37.29

1998

58.606

39.10

1999

58.775

40.56

2000

58.944

42.69

2001

59.114

46.45

2002

59.455

51.12

2003

59.799

54.74

2004

60.145

61.03

2005

60.493

65.12

2006

60.843

69.70

2007

61.194

73.03

2008

61.548

78.65

2009

61.904

83.00

Research Proposal
3.1 Research Method
The methods I will use for this research are literature review, conduction of Questionnaires and
the statistical techniques.

3.2 Research Model

3.3 Theoretical Framework
Health
Expenditure

IV

Labor Force
Participation
Rate

Education

Labor
productivity
D
V

3.4 Variables
Dependent and independent variables of labor productivity affected by health and education are
as following:

1. Dependent Variable:

Labor productivity

2. Independent Variable:

Health expenditure
Labor force participation rate
Education

3.5 Hypothesis
H1: If good health and education is provided to labors, then their productivity will be ultimately
raised.

3.6 Research Design

3.6.1 Population
The population of this research work is entire labor force.

3.6.2 Sample
The sample of this case study is industrial labor.