Advances in computerized systems, technological innovation, global competition and automation have changed the manufacturing environment drastically by decreasing direct labor costs and increasing overhead costs.
Advancement in technology has led to creation of some jobs that can now be performed more effectively and efficiently by machines because of their support automation. Systems like automated inspection, component choosing for assembly, and automatic assembly all help to lower labor costs in the manufacturing industry these days. Since machines and computer modules require constant repairs and up gradation, this has led to an increase in overhead costs for the companies.
For instance, in the United States in the 1980s, the widespread use of bar-code scanners and related point-of-sale systems decreased labor expenses per store by 4.5 percent and the price of the food that customers purchased by 1.4 percent.
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