How is labor productivity measured?

Labor productivity is primarily measured by the ratio of goods produced to the labor hours used in the production process. This measurement focuses on how efficiently labor is utilized to create output within an economy. By comparing the total output, such as the number of goods produced or services rendered, to the number of hours worked, we can derive a clear understanding of productivity levels. A higher ratio indicates that more output is being generated per hour of labor, signaling greater efficiency and productivity in the workforce.

The other options address different economic concepts but do not directly reflect the mechanics of measuring labor productivity. Economic growth trends provide insights into overall economic performance but do not specifically measure productivity per labor hour. Fiscal policies relate to government spending and taxation decisions that influence economic activity without directly measuring productivity. Evaluating total GDP over a fiscal year offers a broad view of economic performance but does not focus on the efficiency of labor in producing that output.