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Pete Grasso - Keeping it Simple

Productivity Means Profits

published on 01.24.17

Productivity Means Profits

It's busier than usual in the office this week, as we're not only finishing up the February issue to go to print, we're also making final preparations for next week's AHR Expo in Las Vegas.

That said, I'll keep this post short. In fact, I'll leave it to the great Ruth King to make my point for me.

A few years ago, she wrote a column on compensation percentage which is still a widely read piece today — Are Your Employees Productive?

The compensation percentage, or productivity ratio, measures how productive your employees are —the dollars spent on payroll and payroll taxes as compared to revenue generated.

The compensation percentage, she says, is the only ratio that’s calculated based only on your profit and loss statement.

Check out her full column here.


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