ECONOMICS

Detailed explanation-1: -Total labour cost consists of: employee compensation (including wages, salaries in cash and in kind, employers’ social security contributions); vocational training costs; other expenditure such as recruitment costs, spending on working clothes and employment taxes regarded as labour costs; minus any subsidies received.

Detailed explanation-2: -The direct labor cost formula is a simple equation for determining direct labor cost. The pay rate multiplied by the time spent working on the project yields the direct labor cost, or Direct Labor Cost= Pay Rate * Project Time.

Detailed explanation-3: -Labour hour rate refers to the use of people for carrying out a task, whereas machine hour rate refers to the tasks that are carried by the machines.