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ABSTRACT
One of the leading indicators of economic development is labor productivity. An effective combination of factors of production is the basis for increasing labor productivity. The human factor has a significant impact on the growth of production because human drives every other factor. Employees need to be motivated to work effectively. The main incentive for the effective work of staff is the salary. Thus, salary affects labor productivity and can stimulate its growth. At the same time, an increase in labor productivity affects the probability of an increase in salaries. So, there is a mutual influence between labor productivity and salary. The purpose of this research is to determine the mutual influence between labor productivity and salary in Azerbaijan. In line with the objective, the task is to assess labor productivity and salary in Azerbaijan and their impact on each other. The article analyzes the dynamics of labor productivity and salary in Azerbaijan at the macro level and industry service. Current trends in these indicators were identified both in the economy as a whole and in individual sectors: agriculture, industry, construction, and service sector. A comparative analysis of changes in labor productivity and salary in Azerbaijan is provided. Using the regression model, the mutual influence of labor productivity and salary in the economy as a whole and its main sectors are calculated. The article uses the methods of comparative analysis, logical generalization and synthesis, regression analysis.
Keywords: salary, labor productivity
1.INTRODUCTION
Labor productivity is a measure of the effectiveness of human labor. The pace of economic development, the possibility of reducing the prime production cost, the growth of income and wages depend on the level of development of labor productivity. Labor productivity shows the efficiency of the economy as a whole at the macro level, the efficiency of industries and regions at the meso-level and efficiency of enterprises at the micro-level. On the one hand, the introduction of engineering and technology into production influences the growth of labor productivity, and on the other, the human factor has its own effect. A person combines with the ability to work, intellect, the desire to cooperate and provide benefit in a particular workplace and society as a whole. To activate human capital, financial and nonfinancial incentives...