Determinants of Output per Workers in Large and Medium Manufacture Enterprise in Mekelle City, Northern Ethiopia

Abstract

This research is made to estimate productivity of labor in large and medium manufacturing firms in Mekelle city by using Logistic regression model. There are 90 large and medium manufacturing firms in Mekelle city. From the total 90 large and medium manufacturing firms data was collected only from 80 firms. Estimation result from the logit model indicate that from eight explanatory variable six of them have significant effect on the probability of producing high amount of output per unit of labor. Therefore, to increase productivity of manufacture, the federal and regional government should investing more in education and training, reduce the high inequality of salary in the manufacturing firms, and increase in firm size. As well as firms should develop the organizational and managerial experience and employ more experienced workers and financial institution to give long-term loan to the manufacturing firms.