With economic reforms increasing market competition, greater efficiency and productivity of factors of production, particularly of the workforce, have become important prerequisites for firms' growth and survival. Consequently, designing appropriate strategies to motivate the workforce in this direction appears as a critical aspect of human resource management. However, an important issue is if increase in wages, salaries, and other benefits can necessarily result in the desired outcomes. This chapter will examine this aspect. Estimating long-term trends in share of wages, salaries, and total emoluments in major industries, it is found that while the share of wages, salaries, and total emoluments has increased in recent years, such changes are not reflected in higher productivity. It is, therefore, suggested that, in addition to higher wages, salaries, and other benefits, enhancing efficiency and productivity of human resources requires adequate emphasis on human aspects as well.
Daharwal, S. and Mishra, P. (2021), "Workforce Compensation and Productivity Growth in the Indian Manufacturing Sector: Lessons for Human Resource Management", Pal, M.K. (Ed.) Productivity Growth in the Manufacturing Sector, Emerald Publishing Limited, Leeds, pp. 121-135. https://doi.org/10.1108/978-1-80071-094-820211010
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