Profit per employee gives us a better idea of how much money each employee produces for the company. After all, employees are the main foundation of a company, shaping its identity, relationships, and reputation.
Profit per employee is calculated by dividing a company's annual profit by its total number of employees. Numerous factors can influence profit per employee, but key elements include industry type, employee productivity, labor costs, management practices, employee turnover, technology, automation, and the company's age.
While overall profit is a normal metric of a company's success, profits per employee is another metric you can look at when determining what companies to invest in.
Industries that commonly rank highest in profit per employee include energy, technology, household products, financials, food, beverages, and tobacco.
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