Labour Productivity in Energy
Sector Companies included in Nifty 50: An Empirical Study
CMA Dr. Meenu
Maheshwari
Assistant Professor,
Department of Commerce and Management,
University of Kota, Kota
Dr.
Ashok Kumar Gupta
Associate Professor (ABST),
Govt. Commerce College, Kota (Raj.)
CA Priya Taparia
Research Scholar,
Department of Commerce and Management,
University of Kota, Kota
Abstract:
Research
Issue: In this modern environment, productivity has become
synonymous for progress. It is key to prosperity. Productivity is the ratio of revalued
output to revalued input; this ratio shows the actual performance of a unit.
Higher the productivity means more efficient use of the resources. In the
present research paper, an attempt has been made to measure, analyse and
compare labour productivity of energy sector companies during the period from
2010-11 to 2017-18 i.e. for eight years.
Research
Findings: Intra company comparison has been drawn with the
help of chi square test and results indicate that hypothesis drawn is rejected
in case of GAIL (India) Ltd. while it is accepted in all the other cases. This
means that the labour productivity indices of the NTPC Ltd., Oil and Natural
Gas Corporation Ltd. and Power Grid Corporation of India Ltd. for the study
period are approximately same and can be represented by straight line trend or
line of best fit. Intercompany comparison has been drawn with the help of Kruskal
Wallis one way analysis of variance test and the results indicate that null hypothesis
is rejected which means that there is significant difference in the labour
productivity ratios.
Research
Suggestion and Recommendation: Possible savings have
been calculated for selected companies of energy sector which suggests that the
total savings in labour input for a period of eight years would have been ₹ 982
crore of GAIL (India) Ltd., ₹ 2237 crore of NTPC Ltd., ₹ 7664 crore of Oil and
Natural Gas Corporation Ltd. and ₹ 1743 crore of Power Grid Corporation of
India if minimum input output ratio might have taken as base.
Keywords: Labour Productivity, Chi Square
Test, Efficiency, Degree of Freedom, Kruskal Wallis One Way Analysis of
Variance Test.
Introduction
The
term productivity refers to the judicious use of the resources or the
optimization of the utilization of resources, physical as well as mental, in
other words it is the one's ability to produce more economically and
efficiently. We should, however, note that the "Productivity" and
"Efficiency" are not identical variables, for "Efficiency"
connotes the competence on capacity of a given input or production unit to
produce under given conditions whereas "Productivity" refers to the
actual results produced by an input or production line under given condition
within a given time at given cost. It is without any improvement in its
efficiency. Conversely, the efficiency of an input may increase without any
simultaneous improvement in its productivity.
Productivity
is concerned with efficiency and effectiveness. It is the real index of
efficiency of an organisation. As efficiency should get reflected in
productivity measures, productivity is considered to be a good proxy for
efficiency. Productivity is the relationship between physical output and one or
more of the physical inputs used in the production process. It is expressed as
a ratio to reflect how efficiently resources are used in creating outputs.
Labour is considered as an important
factor in production because without labour other factors of production will remain
idle. Labour Productivity indicates that how much has been produced as output
by the labour time expended. It measures effective utilisation of labour input
i.e. the rate of degree with which the service of the existing labour are
effectively utilized to increase the output.
Labour
Productivity = Total Output
Labour Input
Review of Literature:
Many
studies on productivity trends in India and abroad have been carried out over
the last few decades. Few studies are being summarised below:
Islam
(1990) focused on the measurement and analysis of labour
productivity with distinct reference to cotton textile industry in Bangladesh.
The evaluation is carried out at two-stages. The first stage explains the
labour productivity at an aggregate level. The second stage analyse the
differential labour productivity at inter-firm level. The present analysis
attempts to grab all these aspects it measures output in physical terms and
labour input in actual hours worked in approaching plant level investigation of
labour productivity. This evaluation is also done with cross-section data and
various hypothesis tests regarding factor affecting labour productivity has
been worked out. The study is remarkable because there are certain marginal
innovations in the methodology applied for measurements of variables. In this
study only production worker has been considered as labour input.
Webber, Curry and
Plumbridge (2009) explained the business productivity and area productivity in
rural England. This paper extends a factual analysis of labour productivity
differentials across the DEFRA. It is the new department for environment, food
and rural affairs. Making use of plant level data, the study examines the
presence and differences between rural and urban productivity. DEFRA objective
is to measure differing economic performance between rural areas and enhance
the performance of the weakest. Rural area productivity indicates critical
significance informing rural area social welfare and polices for social
involvement. The results also suggest that the labour productivity in less
sparse rural as well as in urban areas depends on some similar factors although
labour productivity in sparse rural areas strongly relates to a different
industrial structures and firms in sparse rural areas gain less benefit from
larger capital stocks. As surveys examined that the skills needs (in terms of
levels) are different in different rural areas and may be best secure through
attracting people into rural areas rather than simply seeking to educate or retrains
the local population.
Arendt and Grabowski (2017)
analysed in their paper “Innovation, ICT and ICT – driven labour productivity
in Poland” that the more efforts in terms of innovative sources of productivity
or the introduction of new technologies is required to increase the companies
productivity. In this paper author developed a two way model to establish the
relationship between innovation, ICT (Information and Communication Technology)
use and productivity. The data was collected through the survey of 1000 Polish
companies in the first half of 2015. The relationship is analysed on the basis
of CDM (Crepon Duguet Mairesse) model. This model explains the logic behind
transforming innovation input into innovation output and then measuring the
impact of innovation output on productivity. The study also reveals that the
innovation capacity, ITC implementation and use of the companies are based on
the traditional sources of innovation like R & D Department. The study also
proves that the utilisation of ICT become more effective only if it is
accompanied by co innovative sources of productivity.
Research Gap: As
per the above review of literature and more studies studied related to the
topic, there is no study on labour productivity in energy sector companies included
in Nifty 50. So in this present research paper an attempt has been made to
measure the labour productivity of energy sector.
Objectives of the Research
In
the present research, an attempt has been made to measure, analyse and compare
some concepts regarding labour productivity of energy sector companies included
in Nifty 50 from 2010-11 to 2017-18i.e.for eight years. The main objectives of
this paper are:
1) To
measure, analyse and compare the labour productivity for the energy sector
companies included in Nifty 50.
2) To
measure, analyse and compare the intra company labour productivity for the
study period.
3) To
measure, analyse and compare the inter company labour productivity for the
study period.
4) To
suggest ways for the improvement in labour productivity.
Research Methodology
Collection
of Data
This research paper is based on the
secondary data. The data and information regarding output, labour input and all
other financial variables has been obtained from the annual reports of the
selected companies i.e. GAIL (India) Ltd, NTPC Ltd., Oil and Natural Gas
Corporation of India Ltd. and Power Grid Corporation Ltd. The annual reports
are available on the website of these companies and also the data related to
index numbers has been collected from various bulletins published by Reserve
Bank of India on its website.
Selection
of Base Year
The year 2010-11 has been taken as the
base year. The base year has been selected because the revaluation of output
and input is done on the basis of this year.
Model
to be used
In the present research paper
Productivity Accounting Model propogated by H. S. Davis has been used for
measuring labour productivity because it considers all the elements of output
and input, ignoring the effect of inflation.
Hypotheses
Keeping
in mind the objectives of the research paper, following hypotheses have been
developed which will be tested.
Intra
Company Hypothesis: Tested with the help of chi square test.
Null
Hypothesis (H0): There is no significant difference
in the labour productivity indices of the sampled company for the study period
and can be represented by straight line trend or line of best fit.
Alternative
Hypothesis (H1): There is a significant difference
in the labour productivity indices of the sampled company for the study period
and cannot be represented by straight line trend or line of best fit.
The acceptance of null hypothesis would
reveal that the labour productivity indices of the sampled company for the
study period are approximately equal.
Inter Company Hypothesis: Tested
with the help of Kruskal Wallis One Way Analysis of Variance Test.
Null
Hypothesis (H0): There is no significant difference
in the labour productivity ratios of sampled companies.
Alternative
Hypothesis (H1): There is a significant difference
in the labour productivity ratios of sampled companies.
The acceptance of null hypothesis would
reveal that the labour productivity ratios of sample companies are approximately
equal.
Calculation
of Index Numbers and Conversion Factors
The base year price index has been taken
for the revaluation of data relating to study period and conversion factor has
also been calculated accordingly. Here base year is 2010-11. Following formula
has been used to calculate conversion factors:
Index
number of the base year
Index number for the current year
Table
1
Index
Numbers and Conversion Factors for Revaluation of Data
Backward
splicing technique has been used for calculating the index numbers of 2010-11.
Revaluation of Output:
The output of
the companies has been revalued by multiplying the output values with the
conversion factors. Here for the purpose of the study output includes revenue
from operations, other income and change in the inventories of finished goods,
work in progress and traded goods. Revaluation of output of the companies from
2010-11 to 2017-18have been calculated and shown in Appendix 1 to 4
respectively.
Revaluation
of Labour Input:
The labour input of the companies has
been revalued by multiplying the input values with the conversion factors. Here
for the purpose of this study, the labour input includes salary, wages, bonus
and benefits, contribution to provident and other funds and employees welfare
expenses and others. Revaluation of labour input of the companies from 2010-11
to 2017-18 have been calculated and shown in Appendix 5 to 8 respectively.
Labour Productivity
Labour
Productivity of energy sector companies has been shown from Table 2 to 5 from
2010-11 to 2017-18 taking 2010-11 as a base year for revaluation.
Table
2
Labour Productivity of GAIL
(India) Ltd. from 2010-11 to 2017-18
Base Year 2010-11 Amount in ₹ crore
Average Labour Productivity
Indices= 133.80, a= 133.80, b= -0.31, χ2 = 26.6464, S.D.= 21.19, C.V.=
15.84%
Analysis and
Interpretation:
Output:
The revalued output of GAIL (India) Ltd. is the highest₹47148.15 crore in
2013-14 and it is the lowest₹32844.73 crore in 2010-11.
Salary, Wages, Bonus
and Benefits: The most important element of labour
input is salary, wages, bonus and benefits. It is the highest ₹625.84 crore in
2017-18 and compared to the lowest ₹ 372.44 crore in 2011-12. Its input output
ratio is very important to calculate as this represent for one unit of output
how much input is required. Its input output ratio is the highest 0.0166 in
2010-11 while it is the lowest 0.0097 in 2013-14 and 2014-15.
Contribution to Provident and Other Funds:
Contribution to provident and other funds is the highest ₹
220.18 crore in 2016-17 while it is the lowest ₹ 60.27 crore in 2010-11. Input
output ratio of contribution to provident and other funds
is the lowest0.0018 in 2010-11 and also in 2017-18 as compared to the
highest0.0054 in 2016-17.
Employees Welfare Expenses and Others:
It is ₹114.57 crore in 2010-11, ₹ 11.18 crore in 2011-12, ₹ 101.36 crore in
2012-13, ₹ 101.23 crore in 2013-14, ₹ 105.66 crore in 2014-15, ₹ 93.74 crore in
2015-16, ₹ 105.95 crore in 2016-17 and ₹122.41 crore in 2017-18. Its input
output ratio is the lowest0.0021 in 2013-14 and 2015-16while it is the highest
0.0035 in 2010-11.
Total Labour:
Total labour input is ₹ 721.23crore in 2010-11, decreased to ₹ 560.70 crore in
2011-12 then it slightly increased and reached to ₹ 657.42crore in 2012-13, it
reached to ₹ 646.82 crore in 2013-14, ₹ 649.89 crore in 2014-15 then it
increased and reached to ₹ 676.32crore in 2015-16, ₹ 819.91crore in 2016-17 and
lastly it increased and ultimately reached to ₹ 825.13 crore in 2017-18. Total labour
input output ratio is the highest 0.0220 in 2010-11 while it is the lowest
0.0137 in 2013-14. The lowest labour input output ratio means labour has been
best utilized in the year 2013-14. This means that organisation is neither
short of labour nor its labour remains idle.
Labour Productivity
Ratio: Labour productivity ratio is 45.5399 in 2010-11, 66.0328
in 2011-12, 63.0185 in 2012-13, 72.8924 in 2013-14,71.7277 in 2014-15, 65.8182
in 2015-16, 49.5535in 2016-17 and 52.8852 in 2017-18. Labour productivity ratio
is the lowest45.5399 in 2010-11 while it is the highest72.8924 in 2013-14. The
highest ratio indicates efficiency and effectiveness while the lowest ratio
indicates that the labour input has not been utilized efficiently as compared
to the other year but in this case it is greater than one indicates more output
from less input. Labour efficiency can also be analysed from the average of
labour indices which worked out to133.80 as compared to the base year index of
100 of 2010-11. It is concluded from the above that labour efficiency is there
as compared to the base year labour.
Testing Hypothesis and
Interpretation: The standard deviation and coefficient
of variation of GAIL (India) Ltd. is 21.19 and 15.84 % respectively. The computed
value of chi square is 26.6464. The table value of chi square at 5% level of
significance with (8-1) = 7 degree of freedom is 14.07. As the calculated value
of chi square is more as compared to the table value hence, null hypothesis is
rejected and alternative hypothesis is accepted. This reveals that the labour
productivity indices of GAIL (India) Ltd. for the study period are not equal
and cannot be represented by straight line trend or line of best fit.
Table
3
Labour Productivity of NTPC Ltd. from
2010-11 to 2017-18
Base Year 2010-11 Amount in ₹ crore
Average Labour Productivity Indices =
107.41, a = 107.41, b = 1.14, χ2 = 1.4432, S.D. = 6.86, C.V.= 6.39 %
Analysis and
Interpretation:
Output:
The revalued output of NTPC Ltd. is ₹ 57407.30 crore in 2010-11 and reached to
₹ 68081.15 crore in 2017-18.
Salary, Wages, Bonus
and Benefits: It is showing an erratic trend. It is
the highest ₹2307.06 crore in 2011-12 and the lowest ₹1711.73 crore in 2015-16.
Salary, wages, bonus and benefits input output ratio is the highest 0.0388 in
2011-12 while it is the lowest 0.0280 in 2016-17.
Contribution to Provident and Other Funds:
It is the highest ₹ 762.51 crore in 2013-14 while it is the lowest ₹ 273.08
crore in 2011-12. Input output ratio of contribution to provident and other
funds is the lowest0.0046 in 2011-12 as compared to the highest0.0108 in
2016-17.
Employees Welfare Expenses and Others:
It is the lowest ₹272.38 crore in 2011-12 as compared to the highest ₹414.07
crore in 2014-15.Input output ratio is 0.0051 in 2010-11, 0.0046in 2011-12, 0.0050
in 2012-13, 0.0056in 2013-14, 0.0068in 2014-15, 0.0062in 2015-16, 0.0044 in
2016-17 and 0.0052 in 2017-18. It is the lowest0.0044 in 2016-17.
Total Labour:
Total labour input is ₹ 2789.71crore in 2010-11, ₹ 2852.51 crore in 2011-12,
₹2812.42 crore in 2012-13, ₹ 2951.28 crore in 2013-14, ₹ 2596.05 crore in
2014-15, ₹ 2450.73 crore in 2015-16, ₹ 2819.64crore in 2016-17 and ₹ 3001.78
crore in 2017-18. Total labour input output ratio is the highest 0.0486 in
2010-11 while it is the lowest 0.0408 in 2015-16.
Labour Productivity
Ratio: Labour productivity ratio is 20.5782 in 2010-11
and reached to 22.6803 in 2017-18. Labour productivity ratio is the
lowest20.5782 in 2010-11 while it is the highest24.4864 in 2015-16. The highest
ratio indicates efficiency and effectiveness while the lowest ratio indicates
that the labour input has not been utilized efficiently as compared to other
years. Labour efficiency can also be observed from the average of labour
indices which worked out as 107.41.
Testing Hypothesis and
Interpretation: The standard deviation is 6.86 with
coefficient of variation 6.39 % indicated the variability. The computed value
of chi square is 1.4432. The table value of chi square at 5% level of
significance with (8-1) = 7 degree of freedom is 14.07. As the calculated value
of chi square is less as compared to the table value hence null hypothesis is
accepted and alternative hypothesis is rejected. This reveals that the labour
productivity indices of the NTPC Ltd. for the study period are approximately
sameand can be represented by straight line trend or line of best fit.
Table
4
Labour Productivity of Oil
and Natural Gas Corporation Ltd. from 2010-11 to 2017-18
Base Year 2010-11 Amount in ₹ crore
Average
Labour Productivity Indices = 98.04, a = 98.04, b = - 0.20, χ2 =
9.3463, S.D. = 10.75, C.V. = 10.96%
Analysis and
Interpretation:
Output:
The output of Oil and Natural Gas Corporation Ltd. is showing a fluctuating
trend. It is the highest₹75951.96 crore in 2012-13 and it is the
lowest₹70326.36 crore in 2016-17.
Salary, Wages, Bonus and
Benefits: The important part to analyse in labour input is salary,
wages, bonus and benefits. It is showing a fluctuating trend with ₹5020.13
crore in 2010-11, ₹4767.55 crore in 2011-12, ₹5705.84 crore in 2012-13, ₹4901.62
crore in 2013-14, ₹4894.31 crore in 2014-15, ₹4385.41 crore in 2015-16, ₹
4851.06 crore in 2016-17 and ₹ 5841.37 crore in 2017-18. Its input output ratio
is the highest 0.0788 in 2017-18 while it is the lowest 0.0619 in 2015-16.
Contribution to Provident and Other Funds:
It is the highest ₹ 722.54 crore in 2017-18 while it is the lowest ₹ 328.37
crore in 2010-11. Input output ratio of contribution to provident and other
funds are the lowest 0.0046 in 2010-11 as compared to the highest0.0097 in
2017-18.
Employees Welfare Expenses and Others:
It is the highest ₹2567.20 crore in 2012-13 while it is the lowest ₹615.97
crore in 2014-15. Input output ratio is the lowest0.0087 in 2014-15 and it is
the highest 0.0338 in 2012-13.
Total Labour:
Total labour input of Oil and Natural Gas Corporation Ltd. is the lowest ₹
5935.34crore in 2015-16 as compared to the highest ₹ 8646.34crore in 2012-13. Total
labour input output ratio is the highest 0.1138 in 2012-13 while it is the
lowest 0.0838 in 2015-16. The lowest labour input output ratio means labour is best
utilized in the year 2015-16.
Labour Productivity
Ratio: Labour productivity ratio of Oil and Natural Gas
Corporation Ltd. is 10.6615 in 2010-11, 11.8361 in 2011-12, 8.7843 in 2012-13, 9.3232
in 2013-14,11.4720 in 2014-15, 11.9273 in 2015-16, 9.3381in 2016-17 and 10.2787
in 2017-18. It is the lowest8.7843 in 2012-13 while it is the highest11.9273 in
2015-16. The highest ratio indicates efficiency and effectiveness while the
lowest ratio indicates that the labour input has not been utilized efficiently.
Improvement in labour efficiency can also be observed from the average of
labour indices which is98.04which is lower than the base year index of 100.
Testing Hypothesis and
Interpretation: The standard deviation and coefficient
of variation of Oil and Natural Gas Corporation Ltd. is 10.75 and 10.96 %
respectively. The computed value of chi square is 9.35. The table value of chi
square at 5% level of significance with (8-1) = 7 degree of freedom is 14.07.
As the calculated value of chi square is less as compared to the table value
hence null hypothesis is accepted and alternative hypothesis is rejected. This
reveals that the labour productivity ratios of the company for the study period
of eight years are approximately same and can be represented by straight line
trend or line of best fit.
Table
5
Labour Productivity of Power
Grid Corporation of India Ltd. from 2010-11 to 2017-18
Base Year 2010-11 Amount in ₹ crore
Average Labour Productivity Indices=
156.78, a= 156.78, b = 8.66, χ2 = 10.2894, S.D.= 42.51, C.V.= 27.12%
Analysis and
Interpretation:
Output:
The output of Power Grid Corporation of India Ltd. is showing an increasing
trend with the highest₹24582.29 crore in 2017-18whilethe lowest₹9098.75 crore
in 2010-11.
Salary, Wages, Bonus and
Benefits: It is showing a fluctuating trend. It is the
maximum ₹824.55 crore in 2017-18 as compared to the minimum₹437.20 crore in
2014-15.Its input output ratio is the maximum 0.0622 in 2011-12 while it is the
minimum 0.0249 in 2015-16.
Contribution to Provident and Other Funds:
It is the highest ₹ 232.78 crore in 2016-17 while it is the lowest ₹ 71.16
crore in 2017-18. Input output ratio of contribution to provident and other
funds is the lowest 0.0029 in 2017-18 as compared to the highest0.0164 in
2010-11.
Employees Welfare Expenses and Others:
It is the highest ₹122.43 crore in 2017-18 while it is the lowest ₹80.84 crore
in 2011-12. Input output ratio is the lowest0.0048 in 2016-17 and it is the
highest 0.0095 in 2010-11.
Total Labour:
Total labour input of Power Grid Corporation of India Ltd. is the lowest ₹
665.79crore in 2015-16 as compared to the highest ₹ 1018.13crore in 2017-18. Total
labour input output ratio is the highest 0.0820 in 2010-11 while it is the
lowest 0.0374 in 2015-16. The lowest labour input output ratio means labour is
best utilized in the year 2015-16.
Labour Productivity
Ratio: Labour productivity ratio of Power Grid
Corporation of India Ltd. is 12.1985 in 2010-11 and after facing many
fluctuations during the study period reached to 24.1444 in 2017-18. It is the
lowest12.1985 in 2010-11 while it is the highest26.7538 in 2015-16. The highest
ratio indicates efficiency and effectiveness. Improvement in labour efficiency
can also be observed from the average of labour indices which is156.78which is
lower than the base year index of 100.
Testing Hypothesis and
Interpretation: The standard deviation and coefficient
of variation of Power Grid Corporation of India Ltd. is 42.51 and 27.12 %
respectively. The computed value of chi square is 10.2894. The table value of
chi square at 5% level of significance with (8-1) = 7 degree of freedom is
14.07. As the calculated value of chi square is less as compared to the table
value hence null hypothesis is accepted and alternative hypothesis is rejected.
This reveals that the labour productivity ratios of the company for the study
period are approximately same and can be represented by straight line trend or
line of best fit.
Kruskal Wallis One Way
Analysis of Variance Test
The
labour productivity of all the samples is combined and arranged in order of
increasing size and given a rank number. The rank sum of each of the sample has
been calculated. The detailed calculation has been done in the following table.
Table
6
Comparative
Labour Productivity Ratios from 2010-11 to 2017-18 of Energy Sector and Kruskal
Wallis One Way Analysis of Variance Test
Base Year 2010-11
Value of H =
26.4659
Hypothesis Testing and
Interpretation: The calculated value of H is 26.4659at
5 % level of significance with 4-1 = 3 degrees of freedom and the table value
is 7.8147. As the calculated value is greater than the table value hence null
hypothesis is rejected and alternative hypothesis is accepted. This means that
the labour productivity ratios of the energy sector companies are not same that
is there is significance difference in the labour productivity ratios.
Possible Savings
Possible
savings in labour input has been calculated to analyse what would have been
saved if the labour input is optimally utilized. To view the performance of the
companies in respect of the labour input an attempt has been made to calculate
the possible savings.
Possible Savings in Labour Input of
Energy Sector
To
know the performance of energy sector companies in respect of the labour an
attempt has been made to calculate the possible savings.
Possible
saving in labour input = Actual labour input – Standard labour input
Standard
labour input = minimum requirement of Labour Input per unit of output X Actual
Output revalued according to the base year
Table
7
Possible Savings in Labour Input of
Energy Sector from 2010-11 to 2017-18
Amount in ₹ crore
Note:
Amount has been rounded off to nearest ₹
Table
7 suggests that the total savings in labour input for a period of eight years
would have been ₹ 982 crore of GAIL (India) Ltd., ₹ 2237 crore of NTPC Ltd., ₹
7664 crore of Oil and Natural Gas Corporation Ltd and ₹ 1743 crore of Power
Grid Corporation of India. Possible savings have been calculated by multiplying
the minimum input output ratio with the output of the respective year.
1.
Possible
Savings in Salary, Wages, Bonus and
Benefits of Energy Sector
It
is regarded as very important and essential aspect of labour input. For
analyzing this possible savings has been calculated and results has been
analysed.
Table
8
Possible Savings in Salary,
Wages, Bonus and Benefits of Energy Sector from 2010-11 to 2017-18
Amount in ₹ crore
Note: Amount has been rounded off
to nearest ₹
Table
8 shows that the total savings in salary, wages, bonus and benefits for a
period of eight years is ₹ 636 crore of GAIL (India)
Ltd., ₹ 2370 crore of NTPC Ltd., ₹ 4325 crore of Oil and Natural Gas
Corporation Ltd and ₹ 1406 crore of Power Grid Corporation of India Ltd.
2.
Possible
Savings in Contribution to Provident and Other Funds of Energy Sector
Another
aspect to discuss is contribution to provident and other funds. An attempt has
been made to calculate the possible savings in it.
Table
9
Possible Savings in
Contribution to Provident and Other Funds of Energy Sector from 2010-11 to
2017-18
Amount in ₹ crore
Note: Amount has
been rounded off to nearest ₹
Table
9 reveals that total savings in contribution to provident and other funds
element of labour input is the maximum ₹ 2142 crore of Oil and Natural Gas
Corporation Ltd. while it is minimum ₹ 227 crore of GAIL (India) Ltd.
3.
Possible
savings in Employees Welfare expenses and Others of Energy Sector
Another
aspect of labourinput is employees welfare expenses and others. For analyzing
this possible savings has been calculated and results has been analysed.
Table:
10
Possible Savings in Employees
Welfare Expenses and Others of Energy Sector from 2010-11 to 2017-18
Amount in ₹ crore
Note: Amount has been rounded off
to nearest ₹
Table
10 shows that ₹ 6207 crore would be possible saving of Oil and Natural Gas
Corporation Ltd., R 466 crore of NTPC Ltd., ₹ 187 crore of Power Grid
Corporation Ltd. and ₹ 152 crore GAIL (India) Ltd.
Comparative Average Analysis
To
analyse between the companies of a particular sector it is better to analyse
its average performance of the study period. In the present study an attempt
has been made to analyse and interpret the results on the basis of average
performance.
Table
11
Comparative Average Labour
Productivity of Energy Sector from 2010-11 to 2017-18
Base Year 2010-11
Salary, Wages, Bonus and Benefits
Average Input Output Ratio: The salary, wages, bonus and
benefits average input output ratio of energy sector companies is the best of GAIL
(India) Ltd. by 0.0118, followed by NTPC Ltd. by 0.0329, Power Grid Corporation
Ltd. by 0.0399 and lastly Oil and Natural Gas Corporation Ltd. by 0.0693.
Contribution to Provident and Other Funds Average Input Output Ratio:
It is the best of GAIL (India) Ltd. as compared to the others in the energy
sector.
Employees Welfare Expenses and Others Average Input Output Ratio:
It is 0.0026 of GAIL (India) Ltd., 0.0054 of NTPC Ltd, 0.0068 of Power Grid
Corporation Ltd. and lastly 0.0193 of Oil and Natural Gas Corporation Ltd.
Total Labour Average
Input Output Ratio: The total labour average input output
ratio is the best of GAIL (India) Ltd. with 0.0169, followed by NTPC Ltd. with
0.0454, Power Grid Corporation Ltd. 0.0566 and lastly Oil and Natural Gas Corporation
Ltd. with 0.0968.
Average Labour
Productivity Ratio: Average labour productivity ratio is the
best of GAIL (India) Ltd. with 60.9335 which means that for every one unit of labour
input, the output produced is approximately 60 times. This is followed by NTPC
Ltd. with 22.1025 then Power Grid Corporation Ltd. with 19.1242 and lastly Oil
and Natural Gas Corporation Ltd. with 10.4527.
Chi Square Test: On
analysing the Chi Square of the energy sector companies it has been observed
that NTPC Ltd. has the least chi square value with 1.4432 then the Oil and
Natural Gas Corporation Ltd. with 9.3463, followed by Power Grid Corporation
Ltd. with 10.2894 and lastly it is GAIL (India) Ltd. with the highest chi
square value 26.6464. The table value of chi square at 5% level of significance
with (8-1) = 7 degree of freedom is 14.07. This shows that the null hypothesis
based on the chi square is accepted in all the above cases. This means that the
alternative hypothesis is rejected. This reveals that the labour productivity
ratios of all the companies of energy sector included in Nifty 50 for the eight
years period are approximately the same.
Conclusion:
It
may be concluded from the above analysis that the output per rupee of labour
input is satisfactory of energy sector companies but it is not optimum. Steps
should be taken to stop the wastage of labour input and optimally use labour
input so that its productivity ratio improves more than the present one. However,
on analyzing energy sector as a whole, it may be observed that the labour
productivity ratio is the best of GAIL (India) Ltd. as it has the highest
output per rupee of labour input. Its average labour productivity ratio is 60.9335
which is the highest among the others. Next highest average labour productivity
ratio is 22.1025 of NTPC Ltd., followed by 19.1242 of Power Grid Corporation
Ltd. and lastly 10.4527 of Oil and Natural Gas Corporation Ltd.
Scope for further Research: This
study is based on the labour productivity of energy sector companies included
in Nifty 50 only. More study can also be made on other sectors of Nifty 50
companies and also on companies of BSE and Nifty 100 of NSE Sensex. Also
productivity can also be calculated on the other factors such as material,
overhead, overall, capital, etc.
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Reports:
1. Annual
Reports of GAIL (India) Ltd. from 2010-11 to 2017-18.
2. Annual
Reports of NTPC Ltd. from 2010-11 to 2017-18.
3. Annual
Reports of Oil and Natural Gas CorporationLtd. from 2010-11 to 2017-18.
4. Annual
Reports of Power Grid Corporation Ltd. from 2010-11 to 2017-18.
5. Consumer
Price Index for industrial workers from the website of Reserve Bank of India.
Appendices:
Appendix
1 to 4. Revaluation of Output of Energy Sector
Appendix 1
Revaluation
of Output of GAIL (India) Ltd. from 2010-11 to 2017-18.
Base
year 2010-11 Amount in ₹
crore
Appendix 2
Revaluation
of Output of NTPC Ltd. from 2010-11 to 2017-18.
Base
year 2010-11 Amount in ₹ crore
Appendix 3
Revaluation
of Output of Oil and Natural Gas Corporation Ltd. from 2010-11 to 2017-18.
Base
year 2010-11 Amount
in ₹ crore
Appendix 4
Revaluation
of Output of Power Grid Corporation of India Ltd. from 2010-11 to 2017-18.
Base
year 2010-11 Amount
in ₹ crore
Appendix 5 to 8. Revaluation of Labour
Input of Energy Sector
Appendix
5
Revaluation
of Labour Input of GAIL (India) Ltd. from 2010-11 to 2017-18
Base year 2010-11 Amount
in ₹ crore
Appendix
6
Revaluation
of Labour Input of NTPC Ltd. from 2010-11 to 2017-18
Base year 2010-11 Amount in ₹ crore
Appendix
7
Revaluation
of Labour Input of Oil and Natural Gas Corporation Ltd. from 2010-11 to 2017-18
Base year 2010-11 Amount in ₹ crore
Appendix
8
Revaluation
of Labour Input of Power Grid Corporation of India Ltd. from 2010-11 to 2017-18
Base year 2010-11 Amount in ₹ crore
