Industry 4.0 - Relationship Between Capital Equipment and Labor Productivity

Abstract

Using new technology in production process is naturally connected with the economic development due to attempt to increase labor productivity and/or decrease in unit production costs. In last decades, term Industry 4.0 is used for such cases, as industrial revolution connected with new technology, especially information and communication technology, used in production process. Industry 4.0 is also connected with a fear of disappearing different kind of occupations replaced by new technology and with the fear of lack of employees in other occupations requiring suitable but not yet existing qualification.In the article we present the development of economic indicators and ratios based on production output, compensation on employees, capital equipment, volume of workers, and hours worked to illustrate development of labor productivity in 1995-2018 in Czech Republic, Slovakia, Poland, Hungary, Austria, and Germany. We present results about significant changes in economic structure in analyzed countries, but as results of economic development or economic transformation process. Thus, we try to articulate that the development is rather economic evolution than industrial revolution and that there is no reason to be afraid of Industry 4.0 process.

Is Industry 4.0 a Revolutionary or Evolutionary Change? Analysis of Chosen Economic Indicators for Slovak and Czech Economy

“…Thus, in accordance with the aim of the article, there should be no irrational worries or fears of workers about being supplemented by machines or not being able to adapt to new competencies requirements in the future due to Industry 4.0 implementation in the production process. This analysis builds on previous analyses (Záthurecký & Marinič, 2019;Marinič & Pecina, 2021), and confirms that even if technological changes occur, the volume of fixed assets increases or fixed costs increase, there is no replacement of human labor by machines, and a positive effect on employees can be identified as a result. The logical link between the analyzed variables can be identified, when there is a technological development and investment in the new technologies, which creates space for job creation even within the increasing pressure of competition, not only on the domestic market but also on the international market.…”

Industry 4.0 – Analysis of the Industry Sectors in Czech Republic and Slovakia

“…This analysis builds on previous analyzes [11,12], and confirms that even if technological changes occur, the volume of fixed assets increases or fixed costs increase, there is no replacement of human labor by machines, and as a result positive effect on employees can be identified. The logical link between the analyzed variables can be identify, when there is a technological development and investment to the new technologies, which creates space for job creation even within increasing pressure of competition, not only on the domestic market but also on the international market.…”