COMPUTING LABOR PRODUCTIVITY IN THE USSR

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000700060189-5
• Release Decision: RIPPUB
• Original Classification: R
• Document Page Count: 6
• Document Creation Date: December 22, 2016
• Document Release Date: October 6, 2011
• Sequence Number: 189
• Publication Date: May 3, 1952
• Content Type: REPORT

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CLASSIFICATI~~ONggpp ~' O~~i~~t'~~i ~~~
CENTRAL INTELLIGENC AGENCY REPORT
u
INFORMATION FROM
UI
FOREIGN DOCUMENTS OR RADIO BROADCASTS CD N0.
COUNTRY
USSR ~ DATE OF
SI
INFORMATION
1940 - 1950
:BJECT
Scoaomic -Labor
plrodnctivity
I' , ..
b. ?,
ATEDIST
3
~Y19$2 50X1-HUM
PUBLISHED
WHERE
PUBLISHED
Eooks
USSR
,
.
~
0. OF PAGES
.~,
f?f;~
6 T
DATE
PUBLISHED
1940 - 1950
LANGUAGE
Russian
PPLEMENT TO
REPORT NO.
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p. /. c.. n up pl, u uappn. m Tippnuaop op mp ppnunop
er m eepnpn n ur sum To pp uuTponas rows a rpo?
?Iplnp pT Lpp. pp/ppppmpp pI TMII roU It r110pIMnp.
CObJP111'IIiG LABOR PRODUCTIVITY Ill ~ IISSB
~ihnobere in parentheses refer to appended eources~
Concept of 7sbor Productivity in Soviet Union
Labor prodactivity in the Soviet Union is expressed in terms of quantity
of output during a unit of time spent in production or 1n terms of time spent
is producing a unit of production. (1) Generally, it ie refined ne "output per
worker per unit of time.'!(2, 3) The labor productivity index 1s the ratio
of the volume of output sad the working time spent in producing it. If P
equals labor pa'odnc~ivity, V the volume of output, and T the working time spent
in production, P a Thus, true to Narxian concept, 'abor productivity can be
increased either by increasing the volume of output or by shortening the time
spent in prcdrztion.(3)
~7n publishing statistics on ]Bbor productivity increases, the Soviets do?
not geaera]ly distinguish between increases in labor productivity which were
caused by changes in the ratio of capital equipment to labor and those which
were caused by as increase in the efficiency of labor with a fixed ratio of
capital equi~e~ to lsbor~
lleaeuring Labor Productivity
The basic method oP measuring labor productivity in the Soviet Union ie by
dividing gross production (measured is unchangeable 1926 - 1927 prices) by the
average number oY workers available during the year. For example, if production
of as enterprise for s given moth amounts to 1.5 mil]1oa rubles, while the aver-
age number of workers wsa 300, the index of labor productivity is 11,5
5,000 rubles per worker.
For meaeu:?ing labor productiv~.ty in the production of a single type of ~^
ttct',, the index of Labor productivity is expressed as the ratio of the quantity
of production for a given period in physical units (pieces, tone, meters, etc.)
~~i~~~~!`~ ~ ~F~~
- 1 -
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~,~....
and the average number of workers. For example, if production in an iron
foundry for a given period amounts to 150 tone of cast iron and the average
nveber of workers in 75, the labor productivity index is ~ = 2 tons per
xarker. 5
A third type of index for meeauring labor productivity is ezpressed in
units of working time as the ratio between the time spent in production (maa-
days) and the average number of workera.(4) Hhen production output is com-
pared with a planned figure or with production for a pa~evious (base) period,
it le expressed in "norm-time" units. In such a calculation, it is advisable
to nee the norms used is drawing up the plan, as shorn is the following table:
Type of quantity of Goods ftorm-Days 8peat in Av So
Goode Produced Por tie Qu Production oY dorkera
Base Given Soren Time Base Given Hale Given
Perlod Plan Period in Man -Pgye ?eriod Plan Period Period Plan Period
xo 1
Ao 2
So 3
2,500
3,000
3,000
3.0
7,500
9,000
9,000
--
--
--
500
500
600
0.5
250
250
300
--
--
--
3,500
4,000
4,500
1.2
4,200
4,800
5,490
--
--
--
--
--
--
--
11,950
14,050
14,700
150
165
165
According to the table, the labor-productivity indices are:
a. For the base period, 1~7.~0 : 79.6 man-days
150
b. For the plan, 14,050 . 84.1 man days
c. For the given period, 14,700 = 8g.2 man-days
5
The labor productivity of the given period compares with that of, the base
period, as follows: 89 2_- '0.6.100 = 12.1'
79?
It camparee with the planned figure as fellove: 89 2 _ 84.1 100 ? 6.1(5)
1
According to a publication of the Academy of Sciences USSR, the first, or
the gross production, method is considered fundemeutal and compulsory for plan-
ning and calculating labor productivity for an enterprise as a whole, for a brani.h
of industry, or the whole ecoaomy.(5) ~owever, even the Soviets recognize the
faultiness of calculating labor productivity by the gross production method.]
Oae author suggests ad~uatments in the following cases where labrn productivity
Yor an enterprise is measured by this method:
a. A shift in the assortment of goods produced.
b. A change in the relative emphasis on~the production of certain shops
in the total volume of the enterprise's output.
c. Ad,~uating the quantity of unfinished goods. (4)
CONFIQENTIAI,
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In addition to the erroneous assumption that the price structure prevail-
~ ~ 19~ - 1927 4olds true for the present, the gross production method also
results is s dovaward bide of otrtput per worker in r?_snchea of industry which
produce raw materials as compered with branches which process raw materials
ass semitiaished goods. (6) Defects of the gross Production method are reflected
is sharp changes is the relative emphasis on tls Prodpetion of certain branches,
or by significatrt changes in aseortme~ within a branch. Ia each caeca, the
dynamics of output, expressed is prices, differs from the
ductivity, lhi.ch is expressed is terms of a dynamics of labor pro-
rapidly iacreas xpendlcure of labor. Ia the case of
lag production of a branch of industry (or a commodity within n
branch) for which prices are high, calculation by the gross-production method
shows exaggerated productivity. The broader the basis for calculating average
output (e.g., the average for an Industry, 7~ay~ or Oblast), the lees will it
reflect changes in assortment and volume of production of more or less costly
products, sad the, more accurate trill be the average and its
in s calculation of average Productivity is terms of 1926 iynemics. However,
single enterprise or a sma11 group of products the ~ prices for s
Put my sot be significant. ~ dynamics of the average out-
Suppose an enterprise produces twc kinds of ahoee, leather and canvas, The
same length of time, 4 hours, i~ required for each, but a pair of leather shoes
workeraed adduce 400~s~ canvas at 25. Suppose that during a given period, 100
P~ pairs of leather ahoee. at 40 rubles a pair, totaling 16,000
ruble sad Opp pairs of canvas shoes at 25 rubles a pair, totaling 10,000 rubles.
Altot{ether, 100 workers produced 26,000 rublea~ worth, and output per wrker
amounted to'2,600 rubles.
Ia the next period, the same ntasber of trorkers produced 600 pairs of leather
ehces?at 40 rubles a pair, totaling 24,000 rubles, and 200 pairs of canvas shoes
at 25 rublee'e pair, totaling 5,o0n rubles. Thus, the same workers, working the
same number of hours produced 2y, JO rubles' worth, or 2,900 rubles worth per
worker. The price ~rosa-;~roductio~ method shave an increase in productivity,
while the number of man-hou.?s worked per unit of output remains unchanged. This
example illustrates the fallacy of calculating labor Productivity by the gross-'
production method for a single enterprise.
These defects of the gross-production method can b~ corrected by use of the
index method and, where possible, by the method of expressing output is terms
of actual measurements or in terms of labor costs.
Calculation of Productivity by the index method eliminates the effect of
changes in the volume of groups of products differing in price. The average
rate of increase of productivity in as enterprise, etc., ttlll depend solely on
the number of workers is each shop or enterprise and on the increase in labor
productivity achieved in each group of workers. The result thus computed re-
flects the average differr?^^e is labor costa. The index method ie oP auxil-
iary nature, a check on the gross-production method. Aa example follows.
Ratio of
&aterprice Report Platt Plan Period
to Re
or Branch Period Period Period rt
~-
A Grose production. (rubles) SOp,ppp 600,000 120
Rnmber of workers lpp Ll0 ~0
Output per worker (rubles) 5,000 5,454 109
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Snterpriee
oror Branch
Report
Period
?
Plan
Period
Ratio of
Plan Period
to Report
Period
.
B
Gross production
.
500,000
750,E
~-_
150
Number of workers
200
220
110
Output per worker
2,500
3,409
136
Average by
Grose production
1,000,000
1,350,000
135
gross-
Number of workers
3~
330
110
production
method
Output of worker
3,333
4,090
123
According to this table, the increase of labor oductivity in enterprises
A and B, calcu]ated by the price ~grese-productio~ethod, is 23 percent.
The same calculation by the lndex method, using the number of workers of the
plan period, shows an increase is productivity of 27 percent:
Enterprise
Workers
Iabor
Productivity
Index
A
110
X
109 a
11,990
B
220
X
136
29,920
Total
330
41,910
41330 -127 ~'' the labor-productivity index according to the index method.
Another advantage of the index method is that it can be used xith any form
for expressing production: is terms of 1926 - 1927 prices, physical units,
current prices, etc. OP course, when the volume of production is given in cur-
rent prices, production of both the base and the plan period must be estimated?
in ei ited~.:prices of the same year.
Planning and calculating average labor productivity is terms of physical
units (man-hours or man-days per unit of production) are limited by the vast
diversity of +.ndustrisl production. This method is used only for enterprises
and branches of industry the products of which are homogeneous and comparable.
This method should be uae~i, where possible, in connection with the groas-
production (in terms Oi 1926 -?1927 prices) method. Calculation in terms of
physical units olearly reflects actual changes in expenditure of labor per unit
of production (tone of coal, petroleum, iron, thousands of bricks, etc.), and
corresponds closely to the methods of factory planning. It can be used is such
single-product branches of industry as the coal, petroleum, and peat industries,
ferrous metallurgy, iron mining, nonferrous metallurgy, the cement and brick
industry, lumbering, the plywood and veneer industry, the match and cellulose
industry, various food-processing industrie3, etc.
?I.abor productivity msy be calcu]ated is units'oY working time is breaches
of industry xh?se technical norms are xP].1 established ar~i where production
conditions permit an accurate computation of working time in terms of production
units, to complement calculation by the gross-production method.
4-
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The following table shove a calculation of labor productivity in unite of
working time.
pr~~ Period Price Bach Total Aorm Sours Total
tit 1 1 value Per Product Hours
- rubles rubies)
A Report l,~ 500
Plea 1 5,000 0.5 i00
X000 5 AO 5,000 0.5 500
B Report 2,000 1.50
Plar. 3,000 1.50 3,000 1.0 2,000
4,50 1.0 3,000
C Report 3,000 3 00
Plan 3,300 9,000 1.2 3,600
3.00 9,9~ 1.2 3,960
~, B, and C Report
Plan -" -- 17,000 -- 6,100
-- -- 13,400 -- 7,460
Plan :report -- -- 114.1 _
(~ ~~t ) ].22.3
Ia order to meet the, plan without increasing the number of xorkere, labor
productivity moat be increased not by 14.1 percent, which is the amount of in-
creaee.}n gross production, but by 22.3 percent, to corr~4pond with the increase
in norm time.
This method does not.sllow for certain important factors;
1. Horn fulfillment is not uniform in all sectiona'aad for all workers,
~ and actual expenditure of time in production will not be the same as norm time.
Sven the calculation of norm fulfillment is highly inaccurate in most entex-
pri~e~.
2. Such a calculation does not include the auxiliary shops and occasional
workers.
3? Calculation in terms of norms is eve', less convincing in the cases of
changes in the structure of production (sew products, es in t
tioa). The norms differ considerably in definition and~the de YPe of produc-
fulfillment. In the absence of a practical teat the gree of their
sores for new or c , preliminary definition of
cant c hanged products is highly eub3ective. In the case of signifi-
hsnges la production structure, calculations on the basis of norms are very
inaccurate and tend to err in the direction of minimizing possible productivity.
Because of its many shortcomings; the labor-cost method should be used only.
? for branches of industry which have a Ligh level of labor accounting sad norms,
such as the machine-building industry, since this method can be uses on~p where
cork and production are comparable. The basis of the calculation mast be not
norm time bat sctual time spent is producing the given product. Under such con-
ditions, the ecmPutatioa of expenditure of labor in hours per unit of production
can be of value in drawing up a plan for increased labor productivity. (5)
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c >a~css
i. 7ermatov, B. F., Cr sate Truds i Tekhniehesko a Aormiro~aniYe
(Osganisatioa oS Iabar and x~ ecbaicarL Norms tin8 , ly~o, p ~~`-
2. Taretskiy; ~., Proisvoditel'aoet' Truda 1 8niahan sebestoymwti v
3oro P tiletl~a';Labor etivity and Cost R coon Sn ev ire- ear
Plan ,?1 7, p 51
3? Begidzbaaov, ![., Tekhaicheakoye Eormirovanire i ynedrea Pr s-
si Form (Technical $orn Betting and Introdncing.Progressive~oraa~
19 , p 3
4. 8ukulevich I. L. and Rubin, K. A.,, PLxnirovan rc i Aoaliz Trudo kh
PokazateleY (Planning sad Aas],yzing Lnbo_~ Indices , 9 pp 1 -
5. asone?1Ya Sotelal.isticheeYOy Prwoyehlennoeti (Economics of BOCialiet
Industry), lyW, Institute of Economics, Academe of Sciences QTR, p 462 ff
6. ibid., pp 475-478
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