Labor Intensive

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Definition of 'Labor Intensive'

Labor-intensive is an adjective that describes a business or industry that requires a lot of human labor to produce its goods or services. This is in contrast to capital-intensive businesses, which require a lot of investment in machinery and equipment.

Labor-intensive businesses are often found in developing countries, where labor costs are low. This is because the production of goods and services in these countries is often done by hand, rather than by machines.

Some examples of labor-intensive businesses include agriculture, manufacturing, and construction. In agriculture, workers are needed to plant, grow, and harvest crops. In manufacturing, workers are needed to assemble products. And in construction, workers are needed to build buildings and other structures.

Labor-intensive businesses can be profitable, but they are often more vulnerable to economic downturns than capital-intensive businesses. This is because when the economy slows down, consumers often have less money to spend, which can lead to a decline in demand for goods and services. As a result, labor-intensive businesses may have to lay off workers or close their doors altogether.

Despite the risks, labor-intensive businesses can play an important role in the economy of developing countries. They provide jobs for workers and help to generate economic growth.

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