Labor intensity is the relative proportion of labor (compared to capital) used in any given process. Its inverse is capital intensity. Labor intensity has been declining since the onset of the Industrial Revolution in the late 1700s, while its inverse, capital intensity, has increased nearly exponentially since the latter half of the 20th century. Labor-intensive industries A labor-intensive industry requires large amounts of manual labor to produce its goods or services. In such industries, labor costs are more of a concern than capital costs. Labor intensity is measured by its proportion to the amount of capital to produce goods or services. The higher the labor cost, the more labor intense is the business. Labor cost can vary because businesses can add or subtract workers based on business needs. When it comes to controlling expenses, labor intensive businesses have an advantage over those that are capital intensive and require a large investment in capital equipment, such as the automobile industry. When it comes to include economy of scale, labor intensive industries deal with many challenges: they cannot pay individual workers less by hiring more workers. In case of high level of inflation in the economy, the labor-intensive industry can suffer to some extent. In times of high inflation, laborers are more likely to reveal their unwillingness to work at the same level of wage, because inflation lowers the value of their earnings. Before the industrial revolution, the major part of the workforce was employed in agriculture. Producing food was very labor-intensive. Advances in technology and worker productivity have moved some industries away from labor-intensive status, but many remain, such as mining and agriculture. Examples of labor-intensive sectors include: Nursing Textiles Agriculture — fruit picking is often done by hand as it is difficult for machines to pick, for example, strawberries or apples from trees. Teaching Mining Niche products — If a company specializes in a niche market, there will be less scope for economies of scale and lower fixed costs. In this case, we tend to see higher labor-intensive production. Pottery is an example of niche product. The role in the economy For underdeveloped and developing economies, a labor intensive industry structure can be a better option than a capital intensive one for quick economic development. For countries which are not wealthy and generate low levels of income, labor intensive industry can bring economic growth and prosperity. In most cases, these