Learn about the key characteristics of labor-intensive techniques and how they impact businesses. Understand the benefits and challenges of relying on human labor in production methods.

Characteristics of Labor Intensive Techniques.

The arguments usually advanced in favour of labour intensive techniques are the following:

1. The first is the employment argument. It is only by using labor-intensive techniques that increasing employment opportunities can be provided to the idle or underemployed labor force.
2. When employment increases through the adoption of labor-intensive techniques, “they spread the total ‘income generated more widely over the population.”
3. In underdeveloped countries there is an acture shortage of capita! and entrepreneurial resources. The use of labor-intensive techniques would be more appropriate for releasing these scarce resources to be used in more important uses.
4. Similarly, labor-intensive techniques are import-light, i.e., they require simpler tools and implements which need not be imported from abroad, and thus there is considerable saving in foreign exchange.
5. Labor-intensive techniques are indispensable for counteracting inflationary pressures in a developing economy. They quickly increase the supply of consumable goods and thus obviate the danger of inflation.
6. The use of labor-intensive techniques is usually found in the village and small towns. This would obviate the necessity of building houses and other social works for the workers. This would mean considerable saving in the community’s expenditure on social overheads in the initial stages of development which could be utilized on more important projects.
7. Moreover, labor-intensive methods, being spread out into village and small towns enjoy alt the advantages of decentralization and avoid the evils of the factory system.
8. The emergence of monopolies and oancenitration of economic power in the hands of a few is also avoided.