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.