Manpower Budget Definition


Manpower is the most expensive and complex resource in any business. In a responsibility accounting system, each cost centre manager will specify the people resources available and required to carry out this section of the operation and to prepare the manpower budget.


Employment costs need careful consideration. These are affected by internal factors — promotions, bonus, pay rates, overtime, etc., and external factors — inflation, taxation and social security costs. Plans to increase or decrease manpower will reflect these factors. Compiling a manpower budget in detail allows the manager to make the fullest use of existing resources and, by reorganization when necessary, improve productivity.

Also Check:  Budgeted Income Statement

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